Senate Democrats Call on FTC to Investigate Home-Sharing Services

Democratic Sens. Dianne Feinstein of California, Brian Schatz of Hawaii and Elizabeth Warren of Massachusetts on Wednesday called on the Federal Trade Commission to investigate home-sharing rental services such as Airbnb and “the commercial manner” in which people or companies use those services “to profit from short-term rentals, taking housing inventory off the market and driving up the cost of rent.”

“We are concerned that short-term rentals may be exacerbating housing shortages and driving up the cost of housing in our communities,” Feinstein, Schatz and Warren wrote. “Furthermore, we are concerned that communities and consumers may be put at risk through violations of sensible health, safety, and zoning regulations under state and local law.”

The senators said they were also worried about reports of racial discrimination on some of the services. In December, a report from Harvard researchers found “widespread discrimination” against individuals requesting rentals with black-sounding names on the popular home rental site, Airbnb.

Airbnb Chief Executive Brian Chesky told an audience at a Fortune conference on Tuesday that the company is working to fix issues of prejudice on their platform, according to CNN.

The letter also brought attention to efforts from some of the services to negotiate deals with state and local governments to collect and aggregate tax payments on rentals processed through the firms’ systems. The senators are concerned the companies don’t provide enough detailed information to help officials determine whether those rentals are legal.

Feinstein, Schatz and Warren added, “online platforms appear to be complying with state and local tax laws inconsistently, collecting taxes in some jurisdictions and not others.”

“In order to assess of the use and impact of the short-term rental market, we need reliable data on the commercial use of online platforms,” the senators said.  “We believe the FTC is best positioned to address this data gap in an unbiased manner and we urge the Commission to conduct a review of commercial operators on short-term rental platforms.”

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