Airbnb wants to help create homesharing legislation in Australia

Accommodation booking platform Airbnb hopes to work closely with federal, state, and local governments in Australia to produce legislation that caters for the sharing economy.
Written by Asha Barbaschow on

Sam McDonagh, Airbnb Country Manager Australia and New Zealand, has said he wants to work with governments of all levels in Australia to come up with fair and progressive homesharing legislation.

Speaking at the Think Tank conference in Sydney on Monday, McDonagh said that one of the biggest issues the startup faces globally is the different interpretation on a federal, state, and local government level of what homesharing actually means.

"One of the unique things about cities and places throughout the world that make them amazing places to visit is that they're different," McDonagh said.

"We're in 34,000 cities and in many instances there are many local governments that govern and regulate within those cities."

In an environment that historically has tried to keep Airbnb out of the marketplace, McDonagh said that the recent passing of legislation in London and in Philadelphia, which was the United States' largest city to legalise rentals through online marketplaces, has shown the San Francisco-based company's desire to work with governing bodies.

"There are some amazing examples all around the world like in France where there are specific regulations that have been legislated for the city of Paris and then for the rest of France in terms of the number of days per year that homes can be shared and some of the other restrictions that might be around that," he said. "We are very happy to work with those governments in terms of what that looks like."

McDonagh said that in Australia, it is 100 percent legal to share your home. He said however, that how legality is interpreted is different.

"Sometimes not only from city to city, but council to council and street to street -- you can live on one side of the street and the person that lives on the other side of the street that's in a different council speaks to a different council officer or a different ranger and gets a different answer in relation to sharing their home," he said.

"Australians have been sharing their homes whether it be their holiday homes or otherwise for hundreds of years and they'll continue to do it and we'll continue to work with government at a federal, state, and local government level to help them get down that path.

"A lot of it is just in misinformation."

Speaking of Airbnb's growth in the Australian market, McDonagh said the company is still actively seeking business partners despite many new partners knocking at the company's door.

"It would be fair to say that we've had conversations with some of the biggest companies in Australia and that's really been more from an information perspective. I think there's a sense of that they'd like to use us, and receiving feedback that they'd like to use us, but the company isn't quite there yet and we're not necessarily there yet either."

McDonagh said business travel is something Airbnb will be focused on heavily in 2016.

"That's an important thing for us and we've got some work to do," he said.

One partnership already inked is with Australian telecommunications carrier Optus. In September, Optus and Airbnb offered customers of both services a AU$30 prepaid SIM offering international data roaming, as well as a AU$50 accommodation voucher.

Last month, McDonagh found himself in front of a Senate inquiry into the tax avoidance of multinational companies. The committee probed him on Airbnb's practices, demanding an explanation of where the money paid in Australia was going.

Dismissing the requirement for Airbnb to pay tax in Australia, McDonagh said Airbnb's service results in guests injecting money into the community and often staying longer than a typical tourist would, adding that although Airbnb continues to grow, typical hotels have also experienced a rate increase.

McDonagh also said an average of $7,100 is earned by Airbnb hosts per year, and it is assumed that hosts pay their required tax in their locality.

All Airbnb transactions within Australia move through its Ireland-based platform, as Airbnb Australia is wholly owned by Airbnb Ireland

After raising over $100 million in its latest funding round last month, Airbnb secured a $25.5 billion valuation.

This valuation, initially revealed in July when the company received $1.5 billion from investors, saw the San Francisco startup worth more than hotel giants Marriott ($20.90 billion), Starwood ($14 billion), and Wyndham ($10.01 billion), and just behind Hilton Worldwide -- valued at $27.7 billion.

Marriott's recent $12.2 billion acquisition of Starwood Hotels & Resorts Worldwide, which the company said has created the world's largest hotel company, may require its own valuation to be reassessed.

According to Marriott, the companies combined operate or franchise more than 5,500 hotels with 1.1 million rooms worldwide.

"The driving force behind this transaction is growth. This is an opportunity to create value by combining the distribution and strengths of Marriott and Starwood, enhancing our competitiveness in a quickly evolving marketplace," said Arne Sorenson, Marriott International President and CEO.


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