Disclaimer: The views and opinions expressed in this article are those of the authors and do not necessarily reflect official policy nor laws

We’re smack in the middle of summer, which means, its traveling season. Whether it be a family vacation, road trip, or romantic getaway, vacationers now have a fundamental choice as to where they lay their respective heads while on vacation. Thanks to the major ‘disrupters’ of the hotel market, Air BnB has provided a legitimate alternative to the classic hotel model. We now have the option to experience a new part of the world as a ‘commoner’ not a ‘visitor.’ Instead of the sterile hallways, lifeless decorations, and room service, people can choose living arrangements that have more of a ‘home / authentic’ touch.

I’m a big fan of competition, and feel it typically breeds better outcomes / choices for consumers, and Air BnB certainly has done so. However, it has also caused heartache for some. In particular, hotel owners and those that live in buildings that allow Air BnB rentals. For example, a condo owner could pay a monthly mortgage of $1,000 but rent that same condo for $100 / night. Thus, they are incented to simply rent out their condo as much as possible. So even with the best screening, that particular condo owner’s neighbors would be meeting new inhabitants consistently. In addition, the supply of more options (rooms) in any given market, for the average visitor, inherently drives the pricing for an average hotel room down.

Given this phenomenon remains fairly new, I doubt any regulation of Air BnB will come soon. That said, I’m sure hotels, condo owners and neighbors everywhere are seeking protection from the serial ‘Air BnB renter either federally or even through their insurance, via some form of commercial insurance coverage. Unfortunately, I don’t think any business interruption claim would be honored in such a case….

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