Published on : Tuesday, January 3, 2017
The San Francisco-based travel booking firm Airbnb is about to lose over £325 million in London bookings in 2017, after holiday rental rules in UK is tightening for the rental companies by enforcing a 90-day cap on them. According to the new rule, the rentals will only be allowed to rent accommodations for 90 nights per year in UK.
According to the research data provided by ‘AllTheRooms’, the 90-day cap will threaten around half of the Airbnb night bookings in London. The study also suggests that as the end result of the 90-day cap, almost one third of London bookings of Airbnb will drop.
AllTheRooms has predicted that in 2017, the London reservations will see a rise of almost $812 million from $600 million in 2016.
As Airbnb gets a total of 13 per cent commission from the total amount of bookings, after this cap, they might lose almost $100 million of revenue every year.
Until recently, the 90-day cap was only applicable for the property owners, but the booking platforms are about to face the heat of the 90-day limitation as well.
According to a spokesman from Airbnb, the availability in London is not an issue and they are confident that there is a large range of unique homes for guests to choose.
Airbnb believes, after the implementation of the new rule, the travellers would simply choose other rooms available on their website.
Numerous hoteliers expressed their anger over years as the property owners, who form partnership with Airbnb, do not need to pay any taxes and they can earn up to £7,500 per year; where the hotel owners need to pay higher property taxes and value added taxes.