Airbnb in San Francisco : a new struggle for the right to the city ?

Florian OPILLARD, 2016

On the occasion of a referendum election battle between Airbnb and a militant municipal coalition, the city of San Francisco has been the scene of the company’s strategies since 2014 to maintain its illegal hold on the tourist furniture market. Until 2014, the legislation that regulated tourist rentals through networking platforms such as Airbnb or VRBO allowed the rental of an apartment or room for up to 30 days a year. In October 2014, a new law, described as «  Airbnb-Law  » by local associations, and supported by a supervisor, David Chiu, whose campaign funding comes largely from Airbnb’s financers ¹, legalized almost all advertisements by extending the legal rental period to 90 days. Moreover, this new law, although it provided for the creation of a political entity within the municipality to control the legality of online advertisements, made it impossible for local authorities to control them by not systematically registering guests with the town hall.

After losing this battle, a multitude of independent associations and collectives seized its last resort : the municipal referendum. A coalition, ShareBetter SF, was formed in November 2015, collected the 15,000 voter signatures needed to bring a proposal to the vote, and launched an election campaign for ‘Proposal F’. This measure proposed to regulate the renting of living space by limiting the number of nights to 75 per year for main residences, and by creating the legal possibility for residents and associations to request investigations into the legality of their neighbours’ renting practices. At the end of the most expensive election campaign in the city’s history - Airbnb spent $8.2 million on political subsidies, communication and various events ² - Proposal F lost the referendum by a substantial margin, revealing the circumscribed and territorialized nature of the challenge.

The municipal referendum as a citizen’s last resort

The launch of the election campaign to frame Airbnb and the activist mechanism set up around it are a good example of how the democratic institutions of the city of San Francisco are framing the issue of the struggles against real estate speculation and rental evictions.

At a time when the city is experiencing a serious housing crisis, the controversy surrounding Airbnb’s practices takes on a connotation that is quite specific to the San Franciscan context. The ShareBetter coalition was born in New York in a context of strong protest against Airbnb’s role in the housing crisis, and it is the import of this struggle that gave birth to the coalition called ShareBetterSF, which includes local associations, NGOs and independent collectives behind Proposition F. The criticisms addressed to Airbnb were then multiple. First, the coalition produced a speech on the illegal nature of the ads on the Airbnb website: «  All independent studies to date have concluded that the current law cannot be enforced and will not work. Today, 94% of the 8,500 ads for San Francisco are undeclared and illegal, and the current law permits these practices ³ ". By insisting on the illegality of the ads and the impossibility to control them, ShareBetterSF insists on the damage that these online sharing platforms cause to the housing market : «  Airbnb and VRBO alone concentrate 4,500 whole houses and apartments withdrawn from the San Francisco rental market. That’s 1,000 more than the 3,500 new homes built in all of 2014⁴ ".

The election campaign that raged between the months of September and November 2015 around this issue is a reflection of the political turmoil surrounding this Airbnb issue in particular, and housing issues in general. The city of San Francisco regularly experiences periods of real estate crisis, the most recent of which is linked to the very strong growth of the economy linked to the development of the Internet at the end of the 1990s (Tracy 2014). The bursting of this bubble and the return to an almost normal situation on the real estate market has allowed a lull in the rise in prices. However, since the end of the 2000s, a new housing crisis, this time linked to the geographical proximity of large groups such as Google, Facebook, Appel, Twitter or Uber, has contributed to the explosion in land and rental prices, and with them to the explosion in rental evictions (Opillard, 2015).

The militant response to this context of sharply rising prices and rental evictions is commensurate with this real estate crisis. The election campaign for Proposition F is based on structured networks and traditions of institutional commitment, made up of the driving forces of eight unions (teachers and the construction industry in particular) and forty neighbourhood associations (Haight-Ashbury Neighborhood Council) or organizations such as the Anti-Displacement Coalition, the Sierra Club and the San Francisco Tenants Union. The originality of this coalition lies in the fact that this alliance is completely unexpected, since it benefits from the support of homeowners’ associations, such as the San Francisco Apartment Association, whose commitment is more than a rejection of tourists outside the upmarket and bourgeois neighbourhoods of the western part of the city, otherwise known as NIMBY (Not In My Backyard).

The practical organisation of the campaign is based on the militant skills of trade unions and community organising. (Beitel, 2013) : organisation of neighbourhood meetings by the political groups supporting the initiative, distribution of leaflets, door-to-door visits, leafleting of mailboxes by a small number of volunteers, organisation of meetings to discuss the initiative in Neighbourhood Community Centers in the different neighbourhoods of the city. The campaign appears in fact to be the moment of crystallization of the underlying debates that have been crossing traditions of commitment to a contextual right to the city for decades (Tracy, 2014). It creates spaces in which the practices of Airbnb, the place of technology companies in local politics, and more generally the dispossession of the working and middle classes through gentrification are discussed as public issues (Céfaï 1996). In these discussions, the right to the city as such is very rarely cited in local collectives, but references to the «  right to stay put  » are rarely mentioned. (right to stand there), or slogans like «  Hell no, we won’t go  » (Oh no, we’re not leaving) or «  {Whose city? Our city! » (Whose city is this ? It’s ours !) refer directly to claims in the same register. One has to go up the ladder to find a discourse structured around the right to the city as a central concept, with the actions of the Right to the City Alliance organization, of which several local collectives in San Francisco are members, and which, at the US level, organizes national meetings to train its leaders or online conferences (webinars) for discussion.

The professionalization of Airbnb in the context of the housing crisis

Even in parallel with these institutionalized political arrangements, several independent groups and collectives are fighting against the illegal conversion of apartments into short-term rentals, notably through Airbnb. On the occasion of the Proposition F campaign, the San Francisco Tenants Union and Eviction Free San Francisco, a local direct action collective against rental evictions⁵, accompanied by several activists belonging to different collectives, organized a march in the North Beach neighborhood that they called Death by Airbnb : a walking tour, on October 1, 2015.

This march was an opportunity to link several buildings that had been subject to mass rental eviction through local regulations ⁶, buildings that were then rented out on Airbnb. Jennifer Fieber, an employee of the Tenants Union, specifies, in the first step of this walk : «  We are here in front of 1937 Mason Street. This building was purchased in 2000, four families lived there. The landlord bought it for $830,000, and within a year he used the Ellis Act to evict all the tenants. The building was vacant for a while and then the whole complex was converted into Airbnb apartments. The Tenants Union filed complaints with the city hall, to no avail. So we decided to take matters into our own hands. …] [Last year, we put these stickers (denouncing illegal hotels) on all the illegal hotels we found in North Beach, which worked out pretty well.] Two months later, the owner sold the building and made a profit of $1.25 million after using the Ellis Act}⁷ ".

This description is a good example of how Airbnb’s service is set against a backdrop of very high real estate profitability and loopholes in California law. The purpose of the purchase of this building, as in the case of several others ⁸, is not to put it up for long-term rental, in a city where more than 60 % of the buildings are rented, but rather to turn it into an illegal hotel through Airbnb, or to resell it quickly after renovation in order to achieve a very substantial property gain. Moreover, what the studies proposed by local activists and investigative journalists in the San Francisco Bay Area reveal is the gradual structuring of a professional network parallel to Airbnb, which offers rental property management for owners using Airbnb - e-concierge services for example. Far from offering a simple apartment sharing service, as the company defines it in its communication campaigns, it is proving to be both a political weapon that confirms the influence of finance in municipal political decisions and a new way to take advantage of the lightning profitability of the local real estate market.

Conclusion

This struggle is an example of the crystallization of discontent at the local level, discontent that is exploding in a context of a sharp increase in rental evictions, and thus of the possibility for the working and middle classes to remain in San Francisco. The struggle for the right not to be dispossessed of one’s home, but also the struggle for a broader idea : who is granted the right to stay in the city and to produce the urban social fabric ?

What Airbnb provokes in terms of rental evictions, the conversion of dwellings into illegal hotels, the destruction of neighbourhood solidarity or political pressure on local regulations represents a set of strategies, both of the company and of the people who wish to take advantage of the economic opportunity it offers. In this context, both staying at home - in one’s own home - and staying in the city are demands at two distinct but well-connected scales. In a city where entrepreneurial deregulation strategies and resistance against material, symbolic and political dispossession collide head-on, these demands are set against entrepreneurial strategies of struggles for a right to the city, which take on special significance in the context of San Franciscan super-gentrification, in which income inequalities are among the highest in the United States.

Sources

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