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CanadaBusiness is booming for company that exposes Airbnb rentals

16:10  02 september  2019
16:10  02 september  2019 Source:   thestar.com

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And business , Atamer says, is booming . “We’ve got 10 buildings in Toronto that have hired us. Condos are pretty much left to fend for themselves “ Airbnb has partnered with cities around the world to develop and implement home sharing rules and continues to believe that governments, not

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Business is booming for company that exposes Airbnb rentals© Steve Russell When it comes to short-term rentals that break the rules, “condos are pretty much left to fend for themselves,” says Allen Atamer, whose firm Harmari uses an algorithm to determine the exact locations of accommodations offered on websites like Airbnb.

There were broken chairs scattered around the floor. Torn carpets peppered with cigarette butts. Some puddles of vomit.

It was, in the words of Allen Atamer, “a disaster zone.”

It wasn’t the morning after at a nightclub or a frat house, but a high-end condo building in downtown Toronto, shortly after Halloween. One of the condo units had been rented out on Airbnb, and the renters had thrown a party. The chaos had spilled out into the lobby, some stairwells, and pretty much anywhere people wanted to congregate.

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While business is booming for Airbnb , the company is not without its woes. Critics of Airbnb say taking apartments off the market for short-term rentals means cities lose the tax revenue hotels would pay, while also reducing rental stock and exacerbating the housing crunch.

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“I felt bad for the security guard who was on duty that night,” said Atamer, “and the office manager at the building was just a wreck.”

Until recently, there wasn’t much that management could do when condo owners listed their units on short-term rental sites. But now there is: They can hire Atamer’s company, Harmari, a Toronto-based investigative firm that specializes in helping condo managers and municipalities crack down on short-term rentals that break the rules.

Harmari, founded in 2011, is a modern-day solution to a digital-age problem. Many condo buildings in Toronto forbid owners from listing on short-term rental websites, but it’s a surprisingly hard rule to enforce. The main problem is that most Airbnb listings don’t include a specific address — so even if management suspects a unit is being rented out, it’s tough to prove.

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Whether they’re working for a condo board or a government, Harmari’s approach is the same. It uses an algorithm to continuously scan online listings, then cross-references them with publicly available information to find the physical locations of the units being rented out. If the client is a condo building, the end goal is to make sure no one is breaking the condo rules. That could result in a warning letter from the condo, fines or, eventually, the condo board could try to force a sale.

And business, Atamer says, is booming.

“We’ve got 10 buildings in Toronto that have hired us. Condos are pretty much left to fend for themselves,” said Atamer, whose firm of roughly 35 employees is the biggest of its kind in Canada.

Harmari’s business model has evolved quite a bit since it launched in 2011. Back then, most of the firm’s work was for state governments in the U.S., which were trying to collect sales tax from people selling goods on online sites like Kijiji or Craigslist, and detecting odometer fraud. Some of those governments eventually started asking about trying to find short-term rental listings. That got Atamer and his colleagues thinking.

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“Some of them came to us and asked if we thought we’d be able to find short-term rentals so they could collect taxes, and then we realized that there might be 50 states and 13 provinces and territories, but there are thousands of municipalities. Cities are a much bigger market,” said Atamer, who has since picked up contracts in several U.S. cities which have regulations governing short-term rentals.

In Toronto, the market has been a free-for-all. In late 2017, city council approved regulations that would restrict property owners to short-term rentals of only their principle residences. Those regulations, however, are on hold during an appeal to the province’s Local Planning Appeal Tribunal, which is holding hearings this week.

If the regulations are upheld — and Atamer hopes they are — then the city of Toronto might become his company’s newest client. He has already approached city officials about doing some work for the municipality once regulations are in place.

Airbnb, however, is not happy with the new digital sector it has helped create. It calls services like those offered by Harmari an invasion of its users’ privacy.

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“At a moment when online privacy is top of mind for so many, it is concerning to see third-party sites using questionable tactics to unearth private user information and sell it to cities,” said Airbnb Canada’s Alex Dagg in an emailed statement.

“Airbnb has partnered with cities around the world to develop and implement home sharing rules and continues to believe that governments, not third-party sites, are best equipped to enforce local laws.”

That complaint doesn’t hold much water with Thorben Wieditz, co-founder of Fairbnb Canada, a coalition of groups trying to push for more regulations over short-term rentals.

“In an ideal world, we wouldn’t need companies like Harmari to exist, but Airbnb doesn’t make it easy for people to understand where the listings are. Companies like this can help cities find where the listings actually are,” said Wieditz, who hopes Toronto will eventually have regulations which put the onus on the listing companies themselves — like Airbnb — to make sure units being rented out are properly licensed.

“In cities where they’ve made the platform responsible, listings have dropped 50 per cent,” said Wieditz.

There currently more than 20,000 short-term rental listings in Toronto, according to estimates by Harmari and the city. Once rules are in place, the city might hire an outside firm to help out, acknowledged Elizabeth Glibbery, the director of investigation services for the city’s municipal licensing and standards division.

“The city is considering using this type of service in the future as we develop our short-term rental bylaw implementation plan,” Glibbery wrote in an emailed statement. “As the bylaw is currently being considered at the Local Planning Appeal Tribunal, it is too early to say specific next steps.”

But as long as there are short-term rentals out there, Atamer says there will be enough anger and frustration for him to stay in business.

“People just want to sleep, and be safe,” he said.

Josh Rubin is a Toronto-based business reporter. Follow him on Twitter: @starbeer

Read more

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