6 ms·

"Furthermore, as much as there are local law issues in places like NYC against them, I don't anticipate those lasting long or having a large effect on their rev

"Furthermore, as much as there are local law issues in places like NYC against them, I don't anticipate those lasting long or having a large effect on their revenues." If this is true, it will also apply to their competitors, right? Either the prices of Marriott will fall if/when they stop charging some crazy-expensive taxes on their guests, or AirBnb will have to start paying/charging for those taxes. One way or another, it'll change. Right now, one of AirBnb's advantages is that they are ignoring zoning restrictions and the like; either those restrictions will go away or they'll have to play by those rules. To me, the biggest thing AirBnb has going for them is that they are choosing to play fast-and-loose with the laws, and hoping that they can grow fast enough to change them (similar to Uber). That gives them a huge advantage against the established businesses who have to play by the rules. Marriott can't just say "we're going to build a giant hotel in this area that isn't zoned for it", but AirBnb can hide behind its hosts because presumably they hold all the liability. I imagine there will be some pushback at some point where AirBnb presumably makes most of their money: in big metropolitan areas. In Boston, where I'm at, these are generally illegal/against rental policies. People tend to look the other way for now, but at some point it might become a bigger issue. For me, personally, when I was setting up my condo association, myself & the other owners specifically wrote it into our documents that AirBnb and short-term-rentals are NOT allowed without prior authorization. On a separate note, I wonder what percentage of the hotel revenue is business travel. I know in companies I've worked for in the past, they had some pretty good deals set up with hotel chains, so no matter where you traveled, you stayed at whatever the preferred chain was.

grandalf 12y ago
You are partially right, but the main value of AirBnB is that opens up a larger supply of rooms. Hotel prices often fluctuate wildly -- a room may cost $59 one week and then a few weeks later cost $299 because a trade show is in town, etc. Cities like New York have an insufficient supply of hotel rooms to meet demand. There are often no hotel rooms in NYC available for last-minute booking for under $400/night. With AirBnB, even if everyone paid all the taxes, there would still be thousands of extra rooms available in NYC, many of which would be cheaper than $400 per night. Hotels are a nice idea if you need the sheets changed every day, the room cleaned every day, porters to bring up the luggage, a pool, a front-desk to call to ask how late the pool is open, etc. AirBnB also ads value by offering lots of other permutations. I stayed at an AirBnB in DC and was asked to put my own sheets on the bed (there were freshly laundered sheets in the closet). Upon leaving, I was asked to remove the sheets I used and put them in a basket. The 10 minutes it took me to do those things effectively saved me $100 on the stay, and yes I probably avoided $10 in taxes too.
- JonFish85 12y ago
  "Hotel prices often fluctuate wildly -- a room may cost $59 one week and then a few weeks later cost $299 because a trade show is in town, etc." You don't think this will happen with AirBnb, similar to "surge pricing" with Uber? Continuing with supply & demand, at times of great demand, prices will rise no matter if it's a hotel or AirBnb, even if there is a great deal more supply, there will always be huge bursts of demand (trade shows, what-have-you). AirBnb would seem to flesh out the low-to-mid-range end of the market. If money isn't an object, there are places to stay in NYC (I think--I'm not at that level, myself!). But if you're looking to stay in NYC comfortably for fairly cheap, AirBnb exists with offerings that fit that, albeit they may be illegal (right now). I just question whether that market is "worth" more than the major chains (based on valuations, which I know is a shaky number to use).
  - netcan 12y ago
    Regarding low-mid range, This isn't my experience at all. My experience is that for certain types of travel (eg, meeting friends for a weekend in some fun city) and AirBnB apartment is more fun, IE higher quality than any normal hotel option. Obviously if you compare a midrange apartment to a rockstar suite in a 5 star hotel AirBnB doesn't win but for most fair comparison I value the apartment more than the hotel. Which is better is a matter of taste, I suppose. A lot of people love hotels. I don't. But, for the price ranges that cover 80% of rooms in most cities, I think it's hard to claim that AirBnB is only better value at the lower tiers. There are some awesome places at the 'sold my company to google' price ranges.
    - grandalf 12y ago
      Excellent point. I too prefer staying in someone's comfortable home over a hotel room. Other than at very high end hotels, there are frequently little annoyances (air conditioning cranked up, noisy fans, noisy housekeeping in the morning, excessive use of insecticides, low quality mattresses, small or nonexistent refrigerator, no kitchen, etc.) that detract from the experience.
  - grandalf 12y ago

grandalf 12y ago

You are partially right, but the main value of AirBnB is that opens up a larger supply of rooms. Hotel prices often fluctuate wildly -- a room may cost $59 one week and then a few weeks later cost $299 because a trade show is in town, etc. Cities like New York have an insufficient supply of hotel rooms to meet demand. There are often no hotel rooms in NYC available for last-minute booking for under $400/night. With AirBnB, even if everyone paid all the taxes, there would still be thousands of extra rooms available in NYC, many of which would be cheaper than $400 per night. Hotels are a nice idea if you need the sheets changed every day, the room cleaned every day, porters to bring up the luggage, a pool, a front-desk to call to ask how late the pool is open, etc. AirBnB also ads value by offering lots of other permutations. I stayed at an AirBnB in DC and was asked to put my own sheets on the bed (there were freshly laundered sheets in the closet). Upon leaving, I was asked to remove the sheets I used and put them in a basket. The 10 minutes it took me to do those things effectively saved me $100 on the stay, and yes I probably avoided $10 in taxes too.

JonFish85 12y ago
"Hotel prices often fluctuate wildly -- a room may cost $59 one week and then a few weeks later cost $299 because a trade show is in town, etc." You don't think this will happen with AirBnb, similar to "surge pricing" with Uber? Continuing with supply & demand, at times of great demand, prices will rise no matter if it's a hotel or AirBnb, even if there is a great deal more supply, there will always be huge bursts of demand (trade shows, what-have-you). AirBnb would seem to flesh out the low-to-mid-range end of the market. If money isn't an object, there are places to stay in NYC (I think--I'm not at that level, myself!). But if you're looking to stay in NYC comfortably for fairly cheap, AirBnb exists with offerings that fit that, albeit they may be illegal (right now). I just question whether that market is "worth" more than the major chains (based on valuations, which I know is a shaky number to use).
- netcan 12y ago
  Regarding low-mid range, This isn't my experience at all. My experience is that for certain types of travel (eg, meeting friends for a weekend in some fun city) and AirBnB apartment is more fun, IE higher quality than any normal hotel option. Obviously if you compare a midrange apartment to a rockstar suite in a 5 star hotel AirBnB doesn't win but for most fair comparison I value the apartment more than the hotel. Which is better is a matter of taste, I suppose. A lot of people love hotels. I don't. But, for the price ranges that cover 80% of rooms in most cities, I think it's hard to claim that AirBnB is only better value at the lower tiers. There are some awesome places at the 'sold my company to google' price ranges.
  - grandalf 12y ago
    Excellent point. I too prefer staying in someone's comfortable home over a hotel room. Other than at very high end hotels, there are frequently little annoyances (air conditioning cranked up, noisy fans, noisy housekeeping in the morning, excessive use of insecticides, low quality mattresses, small or nonexistent refrigerator, no kitchen, etc.) that detract from the experience.
- grandalf 12y ago