‘Belong Anywhere?’: Addressing Airbnb’s Housing Discrimination Problem

Blog Post | 110 KY. L. J. ONLINE | August 16, 2021

‘Belong Anywhere?’: Addressing Airbnb’s Housing Discrimination Problem

By: Kendra Craft, Special Features Editor Vol. 110

With an estimated net worth of $113.9 billion by 2027, the short-term rental market is booming in the United States and abroad.[1] Despite the ongoing COVID-19 pandemic, Americans are still loading up their minivans for short, weekend trips that are close to home.[2] Websites like Airbnb, Vrbo, and HomeAway offer stays in shared or private homes, apartments, condominiums, and the occasional hotel room. Other websites, such as Glamping.com and GlampingHub, cater to the more adventurous traveler, advertising unique stays in yurts, tents, teepees, igloos, and treehouses all across the country. One website in particular, Airbnb, has dominated the short-term rental market in recent years and is worth more than the three largest hotel chains, combined, as of December 2020.[3]

Though the short-term rental market has rapidly evolved over the past decade, the laws preventing discrimination in the market itself have not evolved with it. Discriminatory behavior on Airbnb in particular has received national attention. A 2016 study indicated that users of Airbnb with distinctively African American names were 16% less likely to be accepted as guests than users with distinctly white names.[4] In May of 2016, Airbnb was sued by Gregory Selden, an African American man who was denied accommodations by a host who later accepted an accommodation request when Selden applied using a fake profile of a white man.[5] While Selden’s lawsuit was eventually thrown out by a federal judge for violating the arbitration clause wedged within Airbnb’s terms and conditions,[6] the suit brought media attention to the ongoing issue of discrimination on Airbnb and other short-term vacation rental websites.[7] Shortly after Selden’s lawsuit picked up media attention, users with similar experiences began sharing their stories of discrimination using the hashtag #AirbnbWhileBlack.[8]

Since the 2016 lawsuit, Airbnb has introduced several policies intended to curb discriminatory behavior on their platform. Their nondiscrimination policy allows users to report discrimination to Airbnb directly.[9] In 2018, Airbnb also introduced a profile photo protection initiative, which does not display guests’ profile pictures to hosts until after the booking has been confirmed.[10] Airbnb has also developed an an ‘instant book’ option, where guests can instantly book a rental and avoid any chance for a host to decline their application; this initiative was introduced in 2014, but has expanded over recent years.[11] While these initiatives, and the ideals behind them, are certainly a step in the right direction, there is no clear evidence as to whether these policies have actually decreased instances of discrimination across the platform.

In response to continuing allegations of discriminatory behavior on short-term rental platforms and the greater issues of racial injustice in the United States, Airbnb introduced Project Lighthouse in June of 2020.[12] In their introduction of the project, Airbnb claims that they have removed over 1.3 million people from Airbnb since 2016 for declining to “treat others without judgment or bias.”[13] Project Lighthouse, which was scheduled to begin in September of 2020, seems to be more of a research project than a tangible policy implementation. Airbnb plans to, with the help of a third-party, analyze identifying information of their users, such as profile pictures and names, in order to better understand when and how discrimination happens on their platform.[14] Airbnb claims that the data obtained from this research will be used to develop more responsive anti-discrimination policies.[15] Airbnb’s efforts to combat discrimination in the short-term rental market are admirable, but have not yet proven themselves to be responsive to the larger issue. Other short-term rental websites such as Vrbo and HomeAway have even more negligible anti-discrimination policies in place.[16] Unfortunately, federal and state statutes, as they stand now, also fail to provide adequate protection against discrimination to prospective guests.

Landlords were once free to discriminate against prospective tenants, but with the introduction of the Fair Housing Act in 1968, this practice is now prohibited.[17] The Fair Housing Act forbids discrimination on the basis of race, color, sex, handicap, religion, familial status, or national origin.[18] There are, however, multiple exceptions to the Fair Housing Act, including owner-occupied buildings with four or fewer units, single-family homes that are rented without a broker, religious organizations, private clubs, and senior housing.[19] The issue with applying the Fair Housing Act to owners of short-term rentals, such as the hosts on Airbnb, rests with the typically short duration of these stays. The Fair Housing Act only protects “dwellings” that are intended to be occupied as a “residence.”[20] This language arguably excludes short term, transitory stays like those typically offered on Airbnb and other short-term rental websites. Courts have tended to examine these issues on a case-by-case basis, providing no clear method by which to separate residences from temporary stays.[21]

Another potential opportunity for reprieve comes from the Civil Rights Act of 1964.[22] The Civil Rights Act of 1964 is certainly more expansive than the Fair Housing Act; Title II of the Civil Rights Act of 1964 prohibits discrimination in places of “public accommodation” and does not have the same temporal requirement that the Fair Housing Act seems to invoke.[23] However, the Civil Rights Act of 1964 provides exemptions of its own. According to Title II, these protections do not apply to owner-occupied buildings with five or fewer units.[24] This exception allows any host who lives in their rental building and offers five or fewer units for rent to discriminate against guests without violating the Civil Rights Act of 1964.[25] Further reprieve could come from state law; however, most states, including Kentucky, have remained silent on these issues.[26]

In the absence of any robust federal or state protections, short-term rental hosts have more opportunities to openly discriminate against guests with no consequences outside those put in place by the short-term rental websites themselves. This leaves short-term rental guests with few viable options for recovery against discriminative hosts and furthers an acceptance of discrimination in the short-term rental market.

[1] Grand View Research, Inc., Vacation Rental Market Size, Share & Trends Analysis Report By Accommodation Type, By Booking Mode, By Region, And Segment Forecasts, 2020-2027 (May 2020), https://www.grandviewresearch.com/industry-analysis/vacation-rental-market.

[2] Christopher Elliot, This Is Travel’s New Normal: Say Hello To The American Staycation, Forbes (Sept. 5, 2020), https://www.forbes.com/sites/christopherelliott/2020/09/05/this-is-travels-new-normal-say-hello-to-the-american-staycation/?sh=109544c52723.

[3] Tyler Sonnemaker, Airbnb is Worth More than the 3 Largest Hotel Chains Combined After its Stock Popped 143% on its First Day of Trading, Business Insider (Dec. 10, 2020) https://www.businessinsider.com/airbnb-ipo-valuation-tops-three-hotel-chains-combined-opening-day-2020-12.

[4]Edelman, Luca, & Svirsky, Racial Discrimination in the Sharing Economy: Evidence from a Field Experiment, American Economic Journal: Applied Economics (forthcoming), http://www.benedelman.org/publications/airbnb-guest-discrimination-2016-09-16.pdf.

[5] Selden v. Airbnb, Inc., 2016 WL 6476934 (D.D.C., 2016)

[6] Id.

[7] See also, Hobzek v. HomeAway Inc. et al, 2017 WL 476748 (W.D.Tex., 2017) (a similar case to Selden v. Airbnb, wherein an African American woman filed suit against HomeAway based on allegations that she was denied accommodation based on her race). 

[8] See generally, Penman, Vedantam, & Nesterak, #AirbnbWhileBlack: How Hidden Bias Shapes the Sharing Economy, NPR (April 26, 2016), https://www.npr.org/2016/04/26/475623339/-airbnbwhileblack-how-hidden-bias-shapes-the-sharing-economy.

[9] Airbnb, Nondiscrimination Policy (Oct. 30, 2020), https://www.airbnb.com/help/article/2867/nondiscrimination-policy.

[10] Airbnb, Update on Profile Photos (Oct. 22, 2018), https://news.airbnb.com/update-on-profile-photos/.

[11] Airbnb, An Update on Instant Book (July 18, 2019), https://news.airbnb.com/an-update-on-instant-book/.

[12] Airbnb, A new way we’re fighting discrimination on Airbnb (June 15, 2020), https://www.airbnb.com/resources/hosting-homes/a/a-new-way-were-fighting-discrimination-on-airbnb-201.

[13] Id.

[14] Id.

[15] Id.

[16] Vrbo, Inclusion Statement Guidelines, https://www.vrbo.com/discoveryhub/tips-and-resources/guest-management/inclusion-policy-guidelines.

[17] 42 U.S.C. 3601 et seq.

[18] Id.

[19]  Id.

[20] 42 U.S.C. 3601 §802(b).

[21] Airbnb, Is placing restrictions on a guest’s age or familial status prohibited by law?, https://www.airbnb.com/help/article/1620/is-placing-restrictions-based-on-a-guests-age-or-familial-status-prohibited-by-law (Airbnb itself admits that the resolution of each discrimination case is different due to the complexity and disparity of housing laws).

[22] 42 U.S.C. §2000 et seq.

[23] Id.

[24] 42 U.S.C. §2000(b)(1).

[25] Id.

[26] See generally, Airbnb, U.S. Legal Links, https://www.airbnb.com/help/article/1436/us-legal-links (Airbnb’s website provides links to the individual laws of each state in the United States, most of which directly echo the Fair Housing Act and the Civil Rights Act of 1964).