Airbnb says it can alleviate middle-class inequality
Airbnb has claimed that it can help solve the problem of middle-class inequality campaigned on by Donald Trump. Speaking in Sydney, Chris Lehane, head of global policy at the company, argued that the sharing economy could aid recovery from the 2008 crisis. Lehane said that the majority of Airbnb hosts were middle-class homeowners, renting rooms “on an amateur basis”. The fastest-growing group of hosts is older women, whose motivation is social as much as financial. Lehane added that persuading policymakers of Airbnb’s benefits was a key challenge facing the company. Many cities are imposing restrictions on renting out residencies.
Airbnb says it is a solution to the problem of growing middle-class inequality that Donald Trump campaigned on, as it attempts to persuade local governments around the world of what it has to offer.

Chris Lehane, head of global policy, told media in Sydney on Tuesday that a struggling middle class was a concern for both the Democrats and the Republican party in the recent presidential election campaign.

But, he said, opportunities presented by the sharing economy were helping to mitigate the blows dealt by the financial crisis in 2008.

“President-elect Trump talked a lot about quote-unquote the ‘dwindling’ middle class and, on the left, Democrats talked a lot about economic inequality.

“We certainly believe – and the data supports it – that the Airbnb platform is a platform for the middle class. For everyday families, it is generating that supplemental income.”

Lehane said most Airbnb hosts were middle-class homeowners renting out rooms in their primary residence “on an amateur basis” for supplemental income.

The fastest-growing cohort is senior women, who are motivated by social interaction as much as they are disposable income. He said the typical senior host earned US$8,350 from Airbnb each year.

“Wherever I go and in particular when I am meeting elected officials ... I do genuinely ask, ‘are there any programs here that are generating the types of economics that this program is generating for the middle class?’

“I’m yet to see someone come up with something that is producing what this [Airbnb] does in fact produce.

“I want to be clear, I don’t think we are the solution for economic inequality, we most certainly are not, but are part of the solution to it? Yes.”

The US president-elect is meeting with tech executives – reportedly including Elon Musk, Apple’s Tim Cook, Sheryl Sandberg of Facebook, and Silicon Valley investor Peter Thiel – on Wednesday.

Brian Chesky, Airbnb’s chief executive and cofounder, had been invited to the meeting but declined due to a family commitment outside of the US, said Lehane. He understood that though Airbnb put forward other representatives to attend, “the invite was nontransferable. It was for CEOs”.

Asked if Airbnb had concerns about a hotel magnate in the White House, Lehane said Airbnb felt “pretty good about [its] value proposition” to Trump, “someone who’s talked about how you help the middle class out there”.

He added that most regulation of Airbnb in the US took place at a city level, not state or federal level. It was mostly the same in Europe; in Australia and Latin America, it occurred at a state level.

The challenge for the service globally, Lehane said, was persuading policymakers of its benefits.

Last Wednesday, Airbnb released its “policy tool chest”, presenting local governments with options for how they can benefit from home sharing. It followed legislation passed in New Orleans that directed a portion of tax revenue to the construction of affordable housing.

Philadelphia and San Jose, as well as some European cities, have introduced a “two-track” regulatory structure that distinguishes between renting out primary residences and secondary ones.

Earlier this month, Airbnb reached separate agreements with London and Amsterdam that it would cap the number of days a full unit could be let per year, at 90 days and 60 respectively.

The cap, said Lehane, reflected the period at which it “would make more sense for the property to be put on the long-term market”. In both cases Airbnb had agreed to enforce the cap because of barriers posed to local authorities by laws relating to privacy and information-sharing.

With similar agreements in the US, Lehane said Airbnb had cooperated with cities on a registration system to enable them to oversee enforcement themselves.

Lehane said Airbnb wished to partner with cities, not shirk its responsibilities.

“Ultimately, we’re willing to go in either direction, depending on how those cities want to handle it.

“There are a bunch of tools that we can put into place, working very closely with the government, so that they’re able to meet the objectives that they want – benefiting the middle class, getting the benefits for tourism, but also making sure that they’re doing right by the housing market.”

Not every market has welcomed Airbnb’s disruption. It had been pushing back on a law introduced in New York City in October that imposes penalties on people who post short-term apartment rentals.

Last week Airbnb agreed to drop the lawsuit if regulators pursue hosts, not the platform.

Linda Rosenthal, the Manhattan state assembly member who had led the effort against Airbnb, said the settlement was an “astounding about-face” by the company.

Lehane said resistance from New York City had “stood out as a bit of an aberration”.

“New York is a classic example of cities defaulting back to horse and buggy when the car has shown up.”

Nine of the US’s 10 biggest cities will have agreements in place in the coming months, and 19 of the top 20 over the course of 2017, he said.