COMPLETED DRAFT DUE THURSDAY ON THE BLOG 10/13:

LEDE: Newlyweds Ryan and Pam Hess bought their first apartment in West Austin in what year. They immediately looked into listing their home on Airbnb as a way to supplement their income as a running store owner and dog walker.

Pam, age, who  described the couple as  “rule followers,” received multiple e-mails within a few days of listing their apartment. But before Pam could accept any requests, she came across the term Short Term Lease License, otherwise known as the STL. She quickly did some research and went about how to get one.”

QUOTE FROM PAM:

NUT GRAPH: Austin may be tech-central, with a growing number of start-ups and venture capital money flowing –  a place where you would expect the sharing economy to be taking off. Not necessarily so. If you want to rent your apartment on Airbnb, you’re doing it illegally unless you have a short team lease license. XXX What is it. Since when? What’s the problem – you will do this in two sentences. Third sentence: Pam and Ryan Hess’s experience is an example of what homeowners are facing.

Transition:

 

How regulations have redefined who can participate in the growing sharing economy

A new economy is growing from increased regulations on the sharing economy

In 2007 Brian Chesky and Joe Gebbia were two ambitious techies struggling to pay rent in San Francisco. They hatched a plan to rent out air mattresses in their apartment for $80 a night plus breakfast. In the fall of the same year, Amol Surve had already shelled out $1,000 for a ticket to the Industrial Design Conference. He was eager to attend but was unable to find any accommodations within his budget. One day while reading a design blog Surve happened upon an inconspicuous reference to something called Air Bed and Breakfast. Surve reached out to Chesky and Gebbia and made arrangements to be their first guest.

Chesky and Gebbia were onto something and they knew it. [NEED: information on launch and see if there is a correlation between 2008 housing crisis and company take off. Definitely a lot of available real estate] What emerged was a new sharing economy.

Austin’s reputation as a tech friendly city has been called into question over the past year after a series of regulations passed placing restrictions on how citizens are able to participate in this growing sect of the economy. A lot was made about Prop 1 and its passing which resulted in Uber and Lyft pulling out of Austin earlier this year. However, the repercussions of that move had little effect on the consumer with at least eight ride sharing apps popping up quickly in their place. By contrast the laws regulating home sharing are making it increasingly more difficult for the people who would stand to benefit the most from participating.

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There are three types of STLs. The Hesses required a Type 3 STL which denotes a dwelling as part of multifamily use property such as apartments and condos. Because the Hesses were unable to acquire a Certificate of Occupancy they needed to have a Certified Inspection. Right off the bat they were looking at $285 for the application fee and at least $200 for the third party inspection. Aside from the cost there was also the issue of the cap placed on how many STLs the city allows per census tract. The area where the Hesses live only has two STLs available and there is no way to know if there aren’t already other applications for their area waiting to be reviewed.

Comparison of the number of STLs vs the 300+ Airbnb listings in Austin.

The purpose of STLs and outlawing Type 2 STLs.

The third party economy that exploits the STL laws, Type 2 STL owners, third party inspectors, and new “enforcing” companies.