The CEO of Airbnb has issued a warning to visitors planning to visit New York City in the coming year.
Airbnb’s CEO told the Skift Global Forum in New York City last week that hotels are expected to become more expensive as a result of what the company calls a “de facto ban” on Airbnb in the Big Apple.
“I was always hopeful that New York City would lead the way and that we would find a solution in New York,” Brian Chesky said. “Unfortunately, New York is no longer leading the way. It’s probably a cautionary tale.”
About 14 years ago, most of Airbnb’s business was based in New York City. That is no longer the case, and Paris is now where Airbnb has its largest presence. In the months leading up to the Summer Olympics in the French capital of Paris next year, the company’s presence there will grow even more.
Airbnb restrictions in New York City allow only two guests per stay, and hosts must be present for short-term rentals of less than 30 days. According to housing advocacy group Inside Airbnb, as many as 15,000, or nearly 70%, of Airbnb listings in New York City could be affected by the legislation, Wired reports.
According to Chesky, that is bad news for customers.
“I think the consequence of this is going to be that next year hotel rates will be more expensive, and the reason why is we’re not going to be building 20,000 more hotel rooms,” he added. “So, it’s going to be more expensive to stay in New York, and I think that’s unfortunate.”
Airbnb vs. hotels
Chesky didn’t entirely blame the hotel sector for the ban on Airbnb in New York City. However, he did say that in his opinion, its lobbying organizations were somehow involved.
“I’m not an expert on that, and obviously they wouldn’t tell me how much and how involved they were,” he said. “I think that they were absolutely, you know, at the table.”
According to Chesky, 80% of stays booked through Airbnb involve more than two guests, and about half of the nights booked through Airbnb are for stays longer than a week. According to the report, vacation home rentals are a better option for certain types of trips.
“I never felt like for Airbnb to win, hotels had to lose,” Chesky said.
However, it is evident that hotel chains feel the need to compete with Airbnb in some way.
Hyatt has unveiled Homes & Hideaways by World of Hyatt, a new vacation rental platform. This provision follows similar moves in recent years by Marriott, Mandarin Oriental and Accor. IHG is even offering 10,000 IHG One Rewards points to customers who can prove their Airbnb reservation in New York City was canceled due to the new city policy.
“There is overlap. I’m not going to pretend there isn’t,” Chesky said. “But I do want to say there’s less overlap than anyone realizes, and Airbnb allowed a whole bunch of people to travel that weren’t traveling.”