Business Technology

Thursday 28 August 2014

Rental website Airbnb used by crooks, Paris government claims

Published 23/05/2014 | 10:14

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Markit survey revealed that France is floundering
Markit survey revealed that France is floundering
AirBnB's new suite of offices
AirBnB's new suite of offices

The short-term room rental website for tourists, Airbnb, was already in trouble with state authorities in New York. Now it has run into legal problems in France.

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A young man who sub-let a room in his flat in the 9th arrondissment of Paris for €450 a week has been found guilty of breaking his lease and ordered to pay €2,842 damages to his landlord.

The judgment – a first involving Airbnb in France – coincides with a wider crackdown by the French government and the Paris town hall on the flourishing market for letting rooms or whole apartments to tourists.

It also coincides with the settlement of a legal battle between Airbnb and New York State, which could lead to the prosecution of thousands of people who have defied state laws and let rooms or flats to tourists.

In France, the legal situation is complex but the city of Paris believes that many – although by no means all – of the flats or rooms offered on Airbnb and similar sites break the law.

The Airbnb site today listed and illustrated 56 choices for tourists who wished to avoid high hotel bills in Paris.

They ranged from a “room with independent access” at €42 a night to an artist’s studio sleeping eight in the Bastille area for €418 a night. By comparison, the cheapest hotels within the French capital cost around €62 a night.

Airbnb, founded in San Francisco six years ago, claims 500,000 listings in 33,000 towns and cities in 192 countries.

The site was valued recently at $10bn. Up to 12 per cent of rents, plus a credit-card fee, goes to the site. The service has proved extremely popular with both travellers and short-term landlords, who have added thousands of pounds a year to their income.

The New York State Attorney General, Eric Schneiderman, wrote last month that companies such as Airbnb were “cyber cowboys” who had turned the internet into “one of the primary crime scenes of the 21st century”.

In theory, Airbnb is a “peer to peer” or “community” site, which puts “guests” in touch with people who occasionally let all or part of their homes. In practice, authorities believe it is exploited by professional landlords to make huge profits and avoid taxes.

French law, in theory, forbids leases shorter than 12 months. Almost all tenants are forbidden to sub-let their homes, even for a few days.

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