Home sharing sparks Detroit economy
The Motor City is at a tipping point. Businesses are relocating here and bringing jobs with them. The downtown core has established itself as a trendy destination, attracting scores of millennials in the process. The question potential Detroit visitors now ask is not “should I visit Detroit?” but rather “where should I stay when I visit Detroit?”
Home sharing has emerged as a particularly innovative and exciting driver of Detroit tourism. Peer-to-peer home sharing platforms like Airbnb allow Detroiters to rent a room in their home or apartment, or their entire place while they are gone, to visitors from around the globe. The supplemental income — about $4,700 annually for the typical Detroit Airbnb host — is helping working people across Detroit find new ways to pay their mortgages, student debt and other bills.
In 2016, local Detroit Airbnb hosts earned $3.2 million while bringing over 27,000 guests to the city. These visitors are attending Red Wings and Tigers games, eating in Corktown restaurants, shopping in Cass Corridor stores and exploring Midtown museums. Those guests helped make a $10.5 million impact on the city by spending cash at local restaurants and shops. Their presence — and their dollars — are an important part of this city’s comeback.
As this industry expands, it presents local lawmakers with the challenge of how best to pursue regulations. What we find here in Michigan and throughout the nation is that old laws do not always apply well to new ideas.
That’s why we need new regulations that can help bring clear, fair rules for home sharing. That starts with recognizing that Airbnb hosts are not professional bed-and-breakfast proprietors, nor are they running hotels. They are amateurs, sharing their actual homes. The overwhelming majority of Detroit hosts share their primary residence, and 50 percent of them are simply sharing an extra, unused bedroom. Often these are empty nesters whose kids have grown up and left the home.
So what do clear regulations look like? This varies based on a particular city’s priorities, but we believe across the board that the process to register with a city as a host should be easy and simple. Additionally, there should be no caps on how often a host is allowed to share his or her own home.
Mayor Mike Duggan has expressed strong support for home sharing, as well as the Detroiters who are using their homes to welcome more tourism to the city. The Airbnb community has been privileged to be work collaboratively with the mayor throughout the regulatory discussions.
We also believe in helping our host community pay its fair share in taxes. Airbnb has been engaged with the state on an agreement that would allow us to collect and remit sales taxes on behalf of all Michigan hosts, and we also welcome agreements with municipalities like Detroit that would let us collect and remit occupancy taxes.
Unfortunately, other municipalities in Michigan — particularly a handful of cities along Lake Michigan and Lake Erie — have been less welcoming of this innovative trend. Some have attempted to impose harsh restrictions or steep registration fees to share one’s home. Others have attempted to institute outright bans. These cities would do well to follow Detroit’s lead in securing economic development through responsible, family-friendly tourism while managing to protect quality of life.
Detroit’s comeback began with business-friendly policies that embrace innovation and cultivate economic vitality. By encouraging tourism and expanding opportunities for outsiders to experience Detroit authentically, we can shine a global light on the qualities that make this city so special.
Will Burns is the Michigan policy director for Airbnb.