Why are they on the way out? This is because government is rendering this sort of commercial activity more and more difficult with more and more onerous rules and regulation, even including outright prohibition. And why, in turn, might that be the case?
One path toward an explanation of this phenomenon is to ask quo bono? Who gains from interfering with this type of marketplace behavior?
One answer is obvious: hotels and motels.
Airbnbs and VRBOs are out. What’s that you say? What are they? They are short term rentals. Residential occupants rent out their domiciles for anything from a day or two or three up to several weeks and maybe as long as a month or so. Perhaps the vendors go out of town for that stretch of time, and want to add a bit of spending money to their budgets. Maybe they are in the business of renting out residential real estate for such short time periods.
Why are they on the way out? This is because government is rendering this sort of commercial activity more and more difficult with more and more onerous rules and regulation, even including outright prohibition. And why, in turn, might that be the case?
One path toward an explanation of this phenomenon is to ask quo bono? Who gains from interfering with this type of marketplace behavior?
One answer is obvious: hotels and motels. They are in direct competition with those who rent out homes on a temporary basis. For a large family, a residence of 3,000 square feet for $1000 per night is a much better deal than five hotel rooms of $300 each. So, yes, it is a reasonable hypothesis to look at this sector of the economy for an explanation of these new stifling rules.
Another source of dissatisfaction with Airbnbs and VRBOs stems from homeowners and renters who do not engage in such activities. They oppose all this moving in and moving out in their neighborhoods. They want a nice quiet residential experience. They want to know exactly who are their neighbors- whether for safety reasons, or for friendships or block parties or whatever.
What is the optimal allocation of resources between temporary and more permanent accommodation? Desirable from whose point of view? From the perspective of all concerned.
Yes, we can acquiesce that permanent residents want more permanence in their geographical areas. But how, then, do we factor in the desires of temporary residents, many of whom are tourists, who relish just that sort of permanent residences for their short visits, and wish for cheaper room rates?
The free enterprise system provides the only way out of this physical and philosophical morass. The best solution, the only one, is for the government to withdraw its gargantuan powers and exit the scene entirely.
Be seeing you
MCViewPoint 