European cooperative Fairbnb wants to make the short-term rental market more just

The new platform is raising funds to help create a community-oriented alternative to big home-sharing platforms.

In 2016, European cities like Venice, Paris, and Barcelona were feeling the pinch of mass tourism. Residents were moving out of city centers (Venice has watched its population dwindle from a high of 174,808 in 1950 to 56,311 in 2014), and in their place, short-term apartment rentals popped up. Home-sharing platforms are just a part of increased tourism, but governments around the world have been trying to figure out a way to diminish any negative impacts they may have on cities.

One possibility might be Fairbnb, a small home-sharing cooperative in Italy that is hoping to raise a small fund of €30,000 on Indiegogo to create a more equitable platform for people to rent their homes.

It is very hard to prove the impact of home sharing on cities, though several studies have tried. A study from 2017 indicated that home-sharing platforms have some impact on rents and property prices. Last year, the Corporate European Observatory, a research and advocacy group that focuses on exposing corporate privilege, issued a report that said there is an undeniable creep of full-time, short-term rentals onto the market, which means the housing can’t be used for someone to actually live in the city:

Between 47% and 87% of the listings concern the rent of entire houses or apartments, indicating the host is not staying at the place at the same time. Some of these would presumably be people who let their apartments while on vacation themselves, or are temporarily absent for other reasons. However, when you look at the number of listings with “high availability”–available for three months or more–it appears there is a strong presence of places used largely or exclusively for the purpose of letting. On this topic, even the cities with limitations on short-term lets rank high, such as Amsterdam (28.1%), Berlin (38.2%), and Paris (34.4%).

In 2018, Paris invoked strict rules requiring all short-term rental hosts to register with the city. It also made Airbnb liable for advertising unregistered users. In February, the city  launched a suit against the company for $14 million. Amsterdam has also tried to curb short-term rentals. In 2018, it created a 30-day-per-year cap on the number of nights a person could rent out their homes. Airbnb is resisting the 30-day cap and instead supports a 60-day ceiling that was instituted in 2017. It’s not just in Europe; cities in the U.S. like New York, San Francisco, and Miami have all tried to crack down on the platform.

Fairbnb believes it can be a better partner because it has residents’ interests at heart. The idea is that a co-op could work with locals and municipalities to create a marketplace that benefits people who actually live in high-traffic cities. Fairbnb would exclude owners of multiple properties who run their homes as illegal hotels through a one-host, one-home policy: For now, each home and host is verified in person, though that may change as Fairbnb gets bigger. Homeowners who list with Fairbnb will have to be registered and licensed according to local regulations. The co-op will also remit taxes on behalf of hosts. Finally, as members of the co-operative, hosts are owners of the company, which allows them to make decisions about company financials.

As part of its strategy, the co-op will share data with cities–something other home-sharing platforms have only done in a very limited capacity.

“I come from an urban planning background,” says cofounder Sita Veracruz, “so I see transparency and collaboration as very important.” He thinks that communities should have be provided with insight into when tourists are visiting and where. The data will also enable the platform to more actively accept and reject new home rentals in areas that are already feeling the strain of tourism.

Using the cooperative model, Fairbnb has access to a network of other local cooperatives that can service home rentals. For example, Veracruz says, Fairbnb is looking to partner with a co-op of people with cognitive disabilities who could provide cleaning services for homes on the platform. Fairbnb would also put money toward local projects like community gardens.

The co-op takes a 15% commission on each transaction, and half of that goes to a social project. The other half goes toward funding operations. Veracruz is hoping to create an interface that allows renters to be able to select which social initiative their money goes toward.

Already, the cooperative has more than 700 people registered to host homes. Now it’s looking to raise enough money to hire a staff of engineers that will make its platform fully functional. Right now, hosts can pre-register for inclusion on the marketplace. Tourists will be able to make reservations in May, and by the end of June, Fairbnb plans to have launched in Amsterdam, Venice, Barcelona, Bologna, and Valencia.

Putting a co-operative up against a heavily funded juggernaut like Airbnb is no small task. As a result, Fairbnb has been a slow-moving resistance. But there is interest in places as disparate as Canada, New Orleans, and Portland, Oregon, says Veracruz.

“We’re building a house in the middle of the woods,” says Veracruz. “The more resources we can get, the better.”

Read more here.