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While Uber is illegal, Airbnb gets government help

Posted by James on May 26, 2016
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While Uber is illegal, Airbnb gets government help

Tourism Victoria is getting into bed with Airbnb, as the online app’s money-minting hosts claim they are out-competing five-star hotels. The government’s official tourism agency is working with Airbnb to promote Melbourne’s middle and outer suburbs, such as Fitzroy and St Kilda, in an effort to encourage tourism to non-traditional areas. The tie-up ironically came only a day after the swiss replica watches Melbourne Magistrates Court effectively declared ride-share company and fellow sharing-economy pioneer Uber was operating illegally.

Both have an apartment they run through Airbnb in St Kilda and are doing very well from the business Photo: Simon O’Dwyer Australian Hotels Association chief executive Brian Kearney acknowledges that Airbnb is a legitimate competitor – but he’s not happy the hosts don’t have to pay tax. Advertisement “An Airbnb is not taxed at all.

If you’re running a hotel business, you bear the full federal and state taxes. “Some would form a view that you challenge all competition that’s put in front of you.

That’s probably not the way that we’re looking at it – the tourist has got the right to choose whatever accommodation they see fit.

” The new partnership will see Tourism Victoria and Airbnb work together on several step-out websites to promote Melbourne’s outer-Metro suburbs.

Tourism Victoria will also push visitors to its site towards Airbnb. The start-up’s country manager, Sam McDonagh, said print and television advertising might also be a possibility in the future. “We have always worked pretty closely with government.

Obviously it’s early days … but we’re working with them where we can.

“These guides will include maps, customised photography and local editorial – things to see and do, as well as tips from Airbnb hosts about great local business to go to.

” Tourism Victoria CEO Nick Foa couldn’t be reached directly for comment but, in an email, he lauded the new deal.

“Content is king in today’s increasingly fractured travel industry and our plan is to ensure Melbourne and regional Victoria is featured extensively across a whole range of travel and non-travel distribution channels to help spread visitor experiences and economic benefits across the whole State.

” Mr Kearney said it was fine for Airbnb to compete with his members’ business, but warned that many people using the app are not casual room sharers.

“Most people think it’s just somebody renting out a room…

The fact is increasingly these are corporate interests who are buying up groups of apartments and actually running a quasi hotel business.

” Local resident Paul Jewson sounds like Mr Kearney’s worst fears realised.

He already has two investment properties in the suburb bought expressly for Airbnb, and he’s going to start putting people up in his own spare room soon.

“I think we’re competing with four and five star hotels,” Mr Jewson told The Age.

Mr Jewson says his returns from his Airbnb tenants are so good he’s actually managed to positively-gear both his newly purchased St Kilda investment properties.

According to Airbnb’s own figures, users are earning an average of $7100 a year in St Kilda, with most users booking out their rooms for between 30 and 60 days a year.

Read more: https://www.theage.com.au/victoria/while-uber-is-illegal-airbnb-gets-government-help-20151206-glgm6j.html#ixzz49kDnOT4k Follow us: @theage on Twitter | theageAustralia on Facebook

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