Airbnb Under Fire From Regulators: Will Hosts Be Forced To Get Licensed?

It's official: Airbnb is quickly replacing hotels as the preferred choice of accommodations for travelers worldwide. The site was founded in 2008 and already has over 1.5 million listings and 40 million guests around the globe. But to what end? The company is now under fire from regulators, many of whom are pushing to eliminate unlicensed room rentals altogether.

The Airbnb crackdown has been spearheaded by the head of the Federal Trade Commission (FTC), as well as local regulators in certain locations, such as Chicago and Cincinnati. This comes at a time when regulators are also calling for stricter oversight and enforcement on ride sharing platforms such as Uber and Lyft.

According to, the Airbnb issue has sparked debate in the local community of Newport recently. City leaders in the area are assembling a group of residents to put together regulations for people who want to rent their homes out on a short term basis on sites such as Airbnb.

Newport city manager Tome Fromme said, "There are fire code violations, you got all kinds of issues. There are so many questions we need to look at."

A similar situation is taking place for Airbnb hosts in Chicago. Alderman Brendan Reilly, whose ward includes downtown Chicago, is calling for stricter enforcement against Airbnb hosts who are not licensed and in compliance.

Apparently, only 200 out of the nearly 3000 Airbnb rental listings in the Chicago area are licensed properties, according to DNAinfo.

Reilly was unsympathetic when he talked about the issue. He said, "You don't need an inspector to google 'Airbnb.' There is money literally sitting on the table. Bringing Airbnb into compliance is really within our grasp."

What could this new crackdown on licensing mean for Airbnb? Although the ruling is unlikely to come from the FTC itself, the Federal Trade Commission is in a position to offer advice to state and local agencies on how to handle and impose Airbnb regulations.

The sharing economy (think Airbnb, Uber, Lyft) has been a topic of hot debate in recent months, as policymakers are grappling with how to regulate these services which have exploded in popularity.

Policymakers argue that shared services, like Airbnb, could pose a consumer protection issue if they're not properly regulated. Earlier this year, an Airbnb nightmare unfolded in Madrid after a young man from Massachusetts alleged that his host locked him up and sexually assaulted him.

While stories like this certainly aren't common, this isn't an isolated incident. Anytime you're staying in a stranger's home, it's best to proceed with caution, research, and common sense. Airbnb has won over the hearts and business of travelers worldwide; hopefully policymakers won't ruin the party.

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