San Diego’s Agreement With Airbnb to Collect Tourist Taxes Gave Them Huge Windfall

by on July 15, 2015 · 3 comments

in Culture, Economy, Environment, Media, Politics, San Diego

Airbnb page

Page from Airbnb’s website.

If you are one of those people who are keeping track of the short-term rental issue here in San Diego,  you’re probably aware that Airbnb – the largest online short-term rental company – has just made an agreement with the City to begin collecting tourist taxes from visitors and remit them to the City.

And July 15th is the day that Airbnb will begin collecting those taxes on behalf of the hosts that sign up with them for rentals within the City.

This is great if you’re longing forward to see more money pour into the City’s coffers.

But guess what – this agreement includes a huge windfall for Airbnb.

Okay, you ask, just what did our “Number 2” city just give away to the online rental agency, worth an estimated $20 Billion?

Okay, what just happened in our town?

Comic-con, of course, which just ended after a 4-day bonanza.

San Diegans went crazy – not at the event, but in renting out their condos, apartments, cottages, rooms and even couches to Comic-Con visitors.

And Airbnb cashed in on almost a near tripling over last year for local reservations booked for Comic-Con.  A spokeswoman for Airbnb said nearly 2,000 San Diego market listings were booked with them ahead of this year’s event.

That comes down to a whooping 70 percent more short-term rentals than Airbnb usually experiences for a typical weekend in San Diego.

In addition, many of those Comic-Con rentals were at rates significantly higher than the typical Airbnb charge. In a study done for the San Diego Union-Tribune over the Comic-Con extended weekend, they found:

Nearly half of a large sample of Airbnb listings in downtown San Diego revealed price hikes during Comic-Con, with the average increase close to 100 percent. Some hosts raised their prices by almost five times the normal rate ….. In the downtown area alone, its data analysis showed nearly three times the average number of nights booked on Airbnb during Comic-Con.

 So, San Diegans cashed in on the international event, making out like pirates, renting out their homes – or parts of t hem- to some of the more than the estimated 130,000 visitors who converged on the city. And of course, charging their usual take of 3%, Airbnb also made it big during Comic-Con.

And it is so fortunate that the City agreed with Airbnb that they didn’t have to begin collecting taxes until today, July 15th, after all the craziness had died down, waiting for 3 days for everyone to depart.

Why shouldn’t San Diego bend over backwards for the giant firm? Why, according to Airbnb, San Diego is one of most profitable cities for hosts who sign up with Airbnb. San Diego is one the top two destinations with visitors using Airbnb. We’ve heard that –

Miami and San Diego are the most profitable cities for Airbnb hosts. The combination of warm weather and (relatively) affordable housing make these two cities a better bet for full-apartment listings than popular but expensive destinations like New York and San Francisco.

That’s just great. The City is so well off, we can afford $2.1 million EIR studies for the stadium, while pot-holes and planning updates await, and give companies like Airbnb, which is making a haul off San Diego’s growing list of short-term rental hosts, a big break.

Sure, Airbnb, you don’t have to collect those nasty tourist taxes until after all the tourists who attended our biggest tourist event of the year have left.

See the following: San Diego U-T, 7SanDiego  , SanDiego6 , San Diego U-T, Huffington Post


{ 3 comments… read them below or add one }

Old Hippie July 15, 2015 at 2:45 pm

I see some problems with this analysis. First, to say the windfall is “huge” is pure speculation. Also – how is airbnb making money when they will simply pass on the tourist tax to the guest or visitor? In fact, by adding the tax, wouldn’t their 3% be even larger, and they would have made more money if Comic-Con rentals had been included.


OB Joe July 15, 2015 at 2:47 pm

Yea, but the point is right on. Maybe a lot of money wasn’t made by airbnb but if Comic-con had been included, the city – you and me – would have made more money.


Robert July 15, 2015 at 5:45 pm

Airbnb should pay the tax RETROACTIVELY to 2008 – they have been cheating taxpayers since they started their dishonest business. Hotels pay taxes on day one.


Leave a Comment

Older Article:

Newer Article: