May 19, 2016

Shared, Collaborative and On Demand: The New Digital Economy

3. Shared: Home-sharing services

Home-sharing services especially popular with college grads, Americans with higher incomesHome-sharing services are perhaps the classic example of a “sharing economy” platform. These services provide a platform for matching people who are looking for a place to stay for a period of time with other people who have some sort of space available that they are willing to rent. Typically this space is a home, apartment or extra bedroom, but could be anything – from a couch in a common area to a private island.

In many ways, these services function as an internet-enabled version of the boarding houses and bed and breakfasts of an earlier era, albeit on a far grander scale: Airbnb alone represents as much as 17% of available short-term room occupancy in several major cities across the globe, and offers more rooms to the public than many major hotel chains. As a result, questions such as the rights of customers and how these services are regulated have taken on greater salience in recent years. This chapter of the report examines Americans’ usage of and attitudes toward these home-sharing services.

11% of American adults have used an online service such as Airbnb, VRBO or HomeAway to stay overnight in a private residence, but half have never heard of these services before

In total, roughly one-in-ten American adults (11%) say they have stayed overnight in a private residence that they booked using a home-sharing site such as Airbnb, VRBO or HomeAway. Some 34% of Americans are familiar with these services but have not actually used them, and around half (53%) have never heard of these services before.

As was the case with ride-hailing apps (see Chapter 2 of this report), usage and awareness of home-sharing platforms are especially high among college graduates and the relatively affluent –groups that are more likely than less-well-off Americans to take regular trips or vacations in the first place:

  • 25% of college graduates have used home-sharing platforms, while 26% have not heard of them. Among those who have not attended college, just 4% have used these services and nearly three-quarters (73%) have never heard of them before.
  • 24% of Americans who live in a household with an annual income of $75,000 or more have used these services, while 31% have never heard of them. For those living in households with an annual income of less than $30,000, just 4% have used these services and 69% are not familiar with them at all.

At the same time, home-sharing services appeal to a relatively broad age spectrum. Americans ages 35-44 are nearly twice as likely to have used home-sharing services as those ages 18-24 (16% vs. 9%), and the median age of home-sharing users in the United States is 42 – nearly a decade older than the median age of ride-hailing users (33).

Also in contrast with ride-hailing apps, where there were no significant differences across racial or ethnic groups, whites are more likely than blacks to use home-sharing services (13% of whites have done so, vs. 5% of blacks). And while urban and suburban residents use home-sharing at higher rates than rural residents, this difference is much less dramatic than was true of ride-hailing.

37% of home-sharing users – representing 4% of all American adults – have used these services to stay in a shared space in someone’s home

One key way in which home-sharing services differ from traditional hotels is that they give users the option of booking a shared space in someone’s home. These shared spaces might range from a separate bedroom in an otherwise-occupied home to a couch in someone’s living room. In fact, services like Couchsurfing promote their “hosts” (in other words, homeowners) as quasi-tour guides who can help guests live like a local while on vacation.

Overall, some 37% of home-sharing users (which works out to 4% of all American adults) report that they have used these services to reserve a single room or other type of shared space in someone’s home. These shared-space accommodations are more popular among men than among women, and more popular among younger users than among older ones. Just over half (55%) of 18- to 29-year-old home-sharing users have booked a shared space in someone’s home, compared with 32% of users ages 30-49 and 31% of users age 50 and older. Similarly, 43% of male home-sharing users have booked a shared space in someone’s home, compared with 32% of female users.

At the same time, not all users who stay in shared spaces are completely unconcerned about doing so: 48% of those who have done this indicate that they worry about staying with someone they have never met before, although 52% say this is not something they worry about. And while men are more likely than women to stay in a shared space, men and women who use home-sharing services in this way express similar levels of concern about staying with a stranger (45% of men who use home-sharing services in this way say this is something they worry about, as do 51% of women).

Most home-sharing users are not following the regulatory debate over these services particularly closely; those who are following this issue tend to not favor hotel or lodging taxes for owners

Around one-in-five Americans have heard of the debate over the legality of home-sharing services and both users and nonusers strongly support the legality of these services; they also feel (if less strongly) that homeowners using these services should not have to pay taxes in order to use themLike ride-hailing apps, home-sharing services have been the subject of much legal and regulatory scrutiny in recent years. Officials in New York City have been in a long-standing battle over the legality of these short-term rental services, with the New York state attorney general estimating that more than 70% of available rentals on these services are in fact illegal – either for failure to collect and report occupancy taxes or for violating the state’s “multiple dwellings” law. And in California, the Santa Monica City Council recently passed a law severely restricting the city’s short-term rental market, while voters in San Francisco recently defeated Proposition F, which would have similarly restricted home-sharing services in that city.

As with ride-hailing apps, the specific regulatory issues at play in these debates vary from city to city. But in most cases, this controversy centers around two major questions: first, whether it should be legal for residents to rent out their homes using these services in the first place; and second, whether they should be legally required to pay some form of hotel or occupancy tax in order to do so.

The survey asked two separate questions relating to home-sharing platforms and how these services should (or should not) be regulated. First, it asked respondents how much (if anything) they have heard about the debate happening in various cities over the legality of home-sharing services. Second, those who are aware of the debate were asked if they feel those services should be legal, and/or if owners renting their homes on these services should be subject to local hotel or lodging taxes.

In general, Americans are much less aware of the debate over the legality of home-sharing services than they are of the debate over the regulation of ride-hailing apps. Just 22% of Americans have heard of the debate over whether or not these services should be legal (6% have heard “a lot” and 16% have heard “a little”) while 76% have either not heard of the debate, or have not heard of home-sharing platforms in the first place. As noted in Chapter 2 of this report, nearly half of all Americans have heard at least something about the debate over the regulation of ride-hailing services.

Even users of home-sharing services are not following this issue particularly closely. Just 19% of home-sharing users have heard “a lot” about this debate (as noted in Chapter 2, 39% of ride-hailing users have heard a lot about the debate over regulating those services), while 37% have heard “a little.” Indeed, fully 43% of home-sharing users are not aware of this debate at all, roughly three times the comparable figure for ride-hailing users (just 14% of whom are not aware of the regulatory debate over these services).

Although home-sharing users have not been following the legal debate over these services with nearly the same intensity as their ride-hailing counterparts, those home-sharing users who have been following this issue tend to feel that these services should be both legal and tax-free for owners. Among home-sharing users who are aware of the legal debate over these services, 56% believe that these services should be legal and that owners should not have to pay any local hotel or lodging taxes; 31% believe that owners should be able to legally rent out these services but should have to pay taxes for the privilege of doing so.

Both conservative, liberal home-sharing users feel that owners should not have to pay taxes to use these servicesAs might be expected, users who are ideologically conservative, along with those who identify with or lean toward the Republican Party, feel overwhelmingly that people renting out their homes on these services should not have to pay any sort of taxes in order to do so. But this view is also held – albeit to a lesser degree – by users of these services who are to the left of the political spectrum. Users who are Democrats or lean Democratic believe (by a 51% to 38% margin) that homeowners who use these services should not have to pay taxes as a condition of doing so, and liberal users take an anti-tax stance by a similar margin (54% to 34%).

Indeed, even among those Americans who are not home-sharing users but have heard of this debate, 50% feel these services should be legal and that owners should not have to pay taxes; 30% feel they should be legal and that owners should have to pay these taxes; and just 5% think these services should not be legal at all.

Users view home-sharing as a good option for people who travel as a group, as well as for homeowners looking to supplement their income; relatively few view these services as risky to use

Home-sharing users view these services as good for people traveling as groups, homeowners looking for extra incomeWhen presented with a list of seven attributes that might describe home-sharing services, users respond especially strongly to two in particular: Some 87% of home-sharing users believe that these services are a good option for families or other people who like to travel as a group, while 85% believe that these services are a good way for homeowners to earn extra income. A substantial majority (73%) also believes these services are less expensive than a hotel (just 12% think this does not describe these services well).

Users are somewhat more divided on other aspects of home-sharing. Around half believe that these services are best for adventurous travelers (53% think this describes these services well). A similar number believe home-sharing services are located in neighborhoods where it is hard to find traditional hotels (51%). And while 42% of users believe that the properties available on these services are not always as appealing as they are described online, relatively few feel that these services are actually risky to use: 18% of users believe that this statement describes home-sharing services well, compared with 58% who think it does not describe them well.

Younger users are especially likely to view home-sharing services as best suited for adventurous travelers – fully 67% of users ages 18-29 feel that this statement describes home-sharing well, compared with 51% of users ages 30-49 and 48% of those age 50 and older. This difference might be related to the fact that younger users are more likely than older adults to use these services to stay in a shared or common space in someone’s home: 66% of home-sharing users who have stayed in this type of shared space feel that these services are best for adventurous travelers.

At the same time, there are other aspects of home-sharing to which older users are particularly responsive. For instance, 92% of users ages 30-49 and 89% of users ages 50-64 believe that home-sharing sites are a good option for families or other groups – substantially higher than the 77% share of younger users who agree.

And as was the case with ride-hailing apps, men and women do not differ dramatically when it comes to their perceptions of home-sharing services and user safety. Male and female users have nearly identical views on whether or not these services are risky to use (17% of men and 18% of women feel that this statement describes these services well), or whether they are best for adventurous travelers (53% of both women and men agree).

Nonusers6 tend to have mixed views about the relative merits of home-sharing services, although a substantial majority of nonusers view these services as a good way for homeowners to make extra income: Fully 65% of nonusers feel that this statement describes home-sharing services well, while just 5% believe this does not describe home-sharing well. The only attributes on which nonusers respond more strongly than users pertains to issues around user safety: nonusers are twice as likely as users to feel that these services are risky to use (36% vs. 18%).

Most users view home-sharing services as software platforms, not hospitality companies, yet expect these services to play a prominent role in managing various aspects of the overall customer experience

Home-sharing users tend to view these services as software platforms rather than hospitality companies, but they expect these services to have have at least some role in managing the overall customer experienceMuch like ride-hailing services and traditional taxi services, the way that home-sharing platforms are structured differs dramatically from traditional hotel services. Despite providing listings for a vast number of properties, these services do not own, maintain or otherwise exert physical control over any of the properties involved. As a result, consumers might not always know whom to turn to when problems ranging from payment issues to abusive hosts, injuries or even death emerge during their stay.

In general, users of home-sharing services tend to feel that these services are software platforms rather than traditional hospitality companies. When presented with two alternative descriptions of home-sharing services, some 58% of users indicate that they see them as software companies whose business is simply connecting people with a spare room or empty house with others who are looking for a place to stay; meanwhile, 26% view them as hospitality companies that vouch for the quality of the properties they list and have a good deal of control over the customer experience.7

And as was true in the case of ride-hailing, home-sharing users expect these services to play a relatively substantial role in managing specific aspects of the day-to-day user experience when presented with specific follow-up examples:

  • 67% of home-sharing users believe that both individual homeowners and the services themselves should be responsible for making sure that properties are described accurately. Just 8% think it is the sole responsibility of the app or service that people use to book their stay, while one-quarter (23%) believe it is the sole responsibility of individual homeowners.
  • 57% of users believe that both homeowners and services should be responsible for resolving payment issues between hosts and guests. Three-in-ten (31%) think this is the responsibility of the services alone, while 11% think it is the responsibility of individual homeowners.
  • 53% of users believe that both homeowners and services should be responsible for addressing problems that might come up during someone’s stay. One-in-ten (10%) believe that this is the sole responsibility of the app or service, while 35% believe it is the responsibility of the homeowner alone.

Overall, home-sharing users’ views on this question are relatively consistent across various demographic categories, although there are some differences by gender, age and educational attainment. Male home-sharing users are more likely than female users (by a 66% to 53% margin) to view these services as software platforms rather than as hospitality companies. Similarly, 66% of users with a college degree view these services as software platforms, compared with just 46% of users who do not have a college degree. But despite these differences in their abstract views, men and women – as well as those with higher and lower levels of educational attainment – tend to place similar levels of responsibility on these services to help manage different aspects of the customer experience.

In addition to these differences around gender and education, younger users tend to place more responsibility on the app or service when it comes to making sure listed properties are described accurately, and on resolving payment issues between guests and hosts. Some 37% of users ages 18-29 feel that payment issues are solely the responsibility of the app or service (just 22% of users over the age of 50 agree). Meanwhile, 19% of users ages 18-29 feel that these services are obligated to make sure that properties are described accurately (a view that is shared by just 6% of users ages 30-49 and 4% of those 50 and older).

12% of home-sharing users have personally had a bad experience with these services at one point or another

12% of users have ever had a bad experience with home-sharing servicesAs was true for users of ride-hailing apps, most home-sharing users indicate that their experiences with these services have been entirely positive. Some 12% of home-sharing users report that they have had a negative experience at some point or another, while 86% have never had a bad experience while using these services.8

Younger users are more likely than older users to have had a bad experience using home-sharing services at one point or another: 24% of users ages 18-29 have encountered this, compared with 10% of those ages 30-49 and 9% of those ages 50 and older. This may again be related to the fact that younger users are more likely than older users to use these services to stay in a spare room or other shared space in someone’s home – users who do this are roughly twice as likely as other users to have had a bad experience with home-sharing (17% vs. 9%). On the other hand, this trend goes beyond home-sharing sites: As noted in Chapter 2 of this report, younger adults are also more likely to report having a bad experience with ride-hailing apps as well.

And while women are no more likely than men to consider these services to be risky in a general sense, women who use home-sharing services are nearly twice as likely as men to have had a bad experience along the way: 15% of female home-sharing users have had some sort of negative encounter, compared with 8% of men (although it is worth noting that 83% of female home-sharing users have never had a bad experience using these sites).

Lastly, Americans who do not use home-sharing services are substantially more likely to have heard positive things about these services than they are to have heard negative things. Among nonusers who are aware of home-sharing services, 52% have heard of others having good experiences with these services, compared with 33% who have heard of others having bad experiences.

  1. As in previous chapters, “nonusers” refers to nonusers who are aware of these services.
  2. Ride-hailing users have a nearly identical view of the providers of that service: 58% view them as software companies, while 30% view them as transportation companies.
  3. The survey asked a series of follow-up questions asking users about their most recent bad experience; however, the number of users who received this question is too small to report these findings.