Airbnb needs to find new places to list in Paris to keep up with growth. That’s why the company announced a partnership with real estate company Century 21 in France, according to Les Echos and various French media.
Airbnb is in an awkward position in France. It is the company’s most important market, but the Mayor’s Office has also been cracking down on illegal listings. Airbnb now needs to make sure that there’s enough supply for its userbase.
Since December 2017, you have to register your apartment with the city if you want to list it on an online renting platform, such as Airbnb. This way, Paris can keep track of apartments and see if they comply with the current law.
In Paris, you can’t rent an apartment for more than 120 days a year. As a renter, you also can’t sublet your apartment on Airbnb unless the landlord is fine with it. In most cases, the landlord prevents subletting.
But the issue is that many listings in Paris were sublets. A few days after the new rule was enforced, Paris flagged around 1,000 apartments that were not registered with the city, asking Airbnb to remove those listings. And it was just a start as there were tens of thousands of unregistered homes in Paris.
That’s why Airbnb is trying something new. In order to incentivize landlords, Airbnb has worked with Century 21 to authorize subletting. When Century 21 finds a new renter, the company will ask landlords if they want to sign a deal with Century 21 and Airbnb to facilitate subletting.
If everybody agrees, then renters can keep 70 percent of Airbnb revenue. Landlords get 23 percent of proceeds. Century 21 keeps 7 percent.
This seems like an insanely great deal for Century 21 as it’ll generate another revenue stream in Paris. Landlords can also make more money even though rents are already quite high in Paris.
But I’m not sure renters will list their apartments on Airbnb if they can’t make as much money and they have to pay taxes on their Airbnb revenue. It doesn’t seem to be the best way to cover part of your rent. But that should still help add new homes to Airbnb.