How Airbnb Is Changing Hospitality Into a Commodity

How Airbnb Is Changing Hospitality Into a Commodity

Annie Engman's last guests have barely checked out when the next ones arrive: First one Australian, ambling up the slender staircase, then another, then a third in what appears to be a very warm ladybug costume (it's Halloween).

"Hi!" the ladybug sings, placing his bag on the floor.

Engman welcomes them into her small, impossibly cute studio apartment, 450 square feet and decorated to within an inch of its life (it was once featured on the Apartment Therapy blog, which has elevated interior design into a kind of pornography) — a Victrola on the bookshelf, a vintage butterfly table squeezed into a nook, a queen-sized bed perched atop stilts, nearly at the ceiling. Two metal cables running from the bed to the wall support two surfboards. Engman apologizes for not having finished cleaning and suggests the guests take a hike in Runyon Canyon.

Engman, 30, is as confident as any hotel concierge, and why not? She's what you might call a professional Airbnb-er, part of a small but growing group of people who generate a large chunk of their income by renting all or part of their homes to out-of-towners via Airbnb. Engman rents hers for $120 a night, plus a $30 cleaning fee. Hardly a day goes by that her place isn't booked.

As she readily admits, it's not a life for everyone. "I'm just really into hospitality," she says. "I was raised that way. I've always thought my mom should run a bed-and-breakfast."

For years, Engman enjoyed a rather peripatetic life, compulsively traveling (she's driven through all 50 states) and living off an array of freelance jobs: acting, dancing, producing, singing, figure modeling, tutoring, even organic farming. It seemed as if she was always out of town.

Why not, her friends suggested, try this new website that helps you rent your apartment?

A little more than a year later, Engman rarely sleeps in her own bed. Reluctant to give up the steady income her home provides, she in turn sublets at various friends' houses.

"I feel like this is what it must be like to have divorced parents," she says. "To have things in two places, and you can never quite remember where anything is."

Airbnb was founded when Brian Chesky and Joe Gebbia were faced with a classic dilemma: They couldn't afford their pricey San Francisco loft. The two wracked their brains, then an industrial design conference came to town, and hotels were all booked up. But their loft had space. So Chesky and Gebbia blew up three air mattresses, rented them out for a couple nights and cooked their guests breakfast. In a single weekend, they took in more than $1,000.

They later hooked up with Harvard computer science grad Nathan Blecharczyk and spun the idea into a website: Air Bed and Breakfast. In the usual manner of Silicon Valley name evolution, it became Airbnb.

"This is something people have been doing for a long time — sharing their place," Airbnb spokesman Nick Papas says. "Even before the Internet, people would use bulletin boards. But Airbnb makes the entire process more transparent, easier and efficient."

Not only can it save travelers money but it also provides an antidote to hotels.

"You get to stay somewhere that's more personal," says Evan Jarvis, the Aussie in the ladybug costume. "And has character."

Airbnb boasts more than half a million listings in more than 33,000 cities across 192 countries. Some 8.5 million guests have stayed in castles, trains, houseboats, RVs, tree houses — even private islands.

Visitors to Los Angeles have thousands of options. You can sleep on a sofa in a South L.A. garage for $10 a night. You can share a nice room in East Hollywood with a guy named Shree for $25 a night (he might even give you a free yoga lesson). You can rent a loft downtown for $122 a night, a chic Silver Lake bungalow for $110 a night, a cottage just off of Abbot Kinney for $208 a night, a three-bedroom house right on the Malibu sand for $1,096 a night and a seven-bedroom mansion in Encino for $2,500 a night.

According to the website, you can even rent a Gulfstream for $10,000 a night (but the plane has zero online reviews).

The popularity of Airbnb exploded over the summer, especially in Silver Lake, where a veritable civil war has erupted between the amateur hoteliers and their neighbors, who complain that the constant stream of guests in and out of the ultra-trendy Eastside neighborhood is loud, messy — and taking up all the good parking.

"We get a lot of complaints," says Scott Plante, who's on the Silver Lake Neighborhood Council. He says much of the anti-Airbnb crowd wishes to remain anonymous for fear of retribution. A recent neighborhood council meeting took a tense turn; there was shouting and even some "bullying."

"I know of a couple instances where people felt very uncomfortable," Plante says. "It's sad that people can't resolve this in a more amicable manner without bullying people."

Detractors say the spread of Airbnb raises rents for everyone, since it lowers the supply of housing for residents. Instead of looking for roommates or selling their too-big homes to families seeking space, people turn them into mini-hotels, which can crowd out residents in favor of tourists.

Technically, in Los Angeles it's illegal to rent a room in your home to anyone for less than 30 days, unless you have a special permit to run a hotel and pay a special "bed tax." But like so many things here — street vending and medical marijuana come to mind — it's unclear if city leaders have the will or the means to ban Airbnb. According to Plante, the Department of Planning intends to release guidelines, which he hopes will provide some clarity, including regulations.

The Internet has a funny way of taking something informal, such as subletting your apartment or renting out an extra bedroom, and turning it into a business. Just ask Engman, who used to let friends stay for free, even for months at a time.

"Now I've started thinking of time, square footage, all these things, as having such particular values," she says. "It's created a strange commodity mentality."

One young couple, who declined to give their names, used to host foreign-exchange students from Kaplan University in their spare bedroom. Kaplan paid them $800 a month — and they had to cook the students dinner. Now, using Airbnb, they charge $1,100 a month. Both have jobs, but the extra cash is hard to turn down.

Other Airbnb-ers say they've jumped in as much to meet people as to make money.

"I get to meet a lot of interesting people, and learn about different cultures," Juan Ornelas says. Recently, a family from Denmark was staying in his house near Dodger Stadium — while he stayed with his mom. "They share a lot. Sometimes it feels like I'm the one who's traveling."

Engman, too, loves meeting people from all over the world. They'll tell her stories, leave her books and records — although some leave a bit more than that. She recalls a very cool-seeming couple who stayed at her place when she was out of town. She'd paid a friend to clean the apartment after they left.

The friend called Engman, distressed. "There's poop," the friend said. "Everywhere."

"On the sheets, on the towels," Engman explains, almost embarrassed for the couple. "I get that bodies happen, but wow ... how could you not notice?"

Other guests can bring far more welcome surprises. Tracy DiNunzio started renting out her spare bedroom in September 2010 to make some extra money to fund her new business,, where women sell their lightly used Jimmy Choos and Fendi.

Her first renter was a musician from Switzerland. "This guy walked in with a guitar on his back," DiNunzio recalls. "We started talking, we sat on the patio all night. By the end of the following week, we were engaged."

Today, they're married. They moved out of the apartment four months ago, and they no longer use Airbnb.

See also:

Co-ops Re-emerge as an Option for L.A. Creatives

10 Great, Cheaper Neighborhoods Right Next to Yours

Outsmart L.A.'s Rental Market by Living with Someone Else's Parents

Love Your Neighborhood? You May Love its Valley Twin More

Annie Engman and her charmed money-generator


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