Airbnb in apartments: Should it be managed instead of banned?

A group of international tourists staying at an apartment building in Binh Thanh District (HCMC) on March 20 - Photo: H.GIANG

Many experts have proposed this after regulations on business conditions in apartment buildings in Ho Chi Minh City were issued, causing a series of stores and services to be at risk of ceasing operations.

Take advantage of the "golden" location for business

At a recent working session between Mr. Nguyen Van Duoc, Chairman of the Ho Chi Minh City People's Committee, and the District 1 People's Committee, a representative of District 1 proposed allowing a pilot business in apartment buildings, especially in key areas that have an impact on the local economy.

Mr. Du Quang Nghia - Deputy Head of the Economic Department of District 1 - said that the locality is exploiting all forms to serve tourists and residents. For example, the apartment complex in the Nguyen Hue area has become a highlight of the district, beautifully decorated and attracting many tourists.

"Instead of banning, we can pilot allowing business in apartment buildings," said Mr. Nghia, adding that if approved, the district will coordinate with the Department of Finance to pilot licensing, and the locality will inspect and require the implementation of safety and fire prevention plans.

Tuoi Tre's records on March 20 show that many old apartment buildings in the center of District 1, restaurants, fashion shops, souvenir shops... are still operating and attracting a large number of customers and tourists.

Mr. LNĐ. (manager of a coffee shop at 42 Nguyen Hue apartment building) said that this shop welcomes a large number of customers every day, including both domestic and international customers, because this apartment building has a series of shops and amenities for tourists to experience without having to move too much. This is also a destination that many tourists recommend by word of mouth, so the shops here are always crowded.

Meanwhile, Ms. HBN (manager of a health care store) said that renting a store in an old apartment building in the center of Ho Chi Minh City for 20 - 30 million VND/month is many times more economical than renting a space outside, while having a stable number of customers every day.

Mr. Le Hoai Nam (owner of a fashion store in an apartment building in District 1) said that many old apartment buildings are no longer inhabited due to their small area and degraded facilities. Instead, the owners rent them out or open business services to take advantage of their central location. In particular, many apartment buildings have their own unique features, becoming tourist attractions and are introduced by many tourism channels.

"It is clear that many old apartments in the city center have created a unique business culture, similar to many other old apartments in other countries in the region, so having a policy to allow this business activity to exist is suitable for Ho Chi Minh City," said Mr. Nam.

Add a tourism product for tourists

Speaking with Tuoi Tre, Ms. Nguyen Thuong Hoai (providing short-term accommodation services at some apartments in Ho Chi Minh City) said that short-term accommodation rental services at apartments through international platforms (Airbnb) have been operating in Ho Chi Minh City for nearly 10 years.

According to Ms. Hoai, the Airbnb model has contributed to promoting tourism by creating a variety of accommodations, meeting the needs of many domestic and international tourists, especially tourists traveling in groups, families and experts.

Ms. Hoai said that many countries in the world have allowed Airbnb to operate and built a legal framework to manage this model. Therefore, the Airbnb business community recently submitted a proposal to have a legal corridor, allowing the pilot operation of the Airbnb model in Ho Chi Minh City.

"There needs to be a pilot mechanism, considering this a legal business, with business registration, managed by law, with residence registration, and paying full taxes. Resolution 98 on the specific mechanism of Ho Chi Minh City is an important basis for piloting Airbnb in Ho Chi Minh City," said Ms. Hoai.

Similarly, Ms. Tran My Phuong (Airbnb service provider) said that in many countries around the world, short-term accommodation services are allowed to operate, and hosts can rate customers, and if there are violations, they will not be allowed to use the service in the future. Therefore, instead of banning, there should be a pilot policy, allowing areas where they are allowed to operate, limiting areas where they can be used, and if there are violations, the service provider will be punished.

Mr. Le Huu Nghia - Vice President of the Ho Chi Minh City Real Estate Association - said that it is necessary to have a pilot mechanism so that apartments are allowed to provide short-term stays and apartments in the center of Ho Chi Minh City are allowed to provide some services to serve tourists.

According to Mr. Nghia, the nature of these apartments is for rental accommodation, which can be 1-2 days but can also be 20-30 days and serve a group of tourists who need to use the service to stay in groups, can cook, do laundry and have a common living space. The law also has regulations to sanction violations.

"If violations are detected, the authorities will handle them. But in reality, violations rarely occur in this short-term stay. Therefore, it is necessary to manage and clearly define the cases that are allowed to do business, the services that are allowed to be done, and consider this a special tourism product of the city," Mr. Nghia proposed.

US has first law for short-term rental services

New York State’s new Short-Term Rental Registration Act will officially take effect on March 25. Accordingly, New York State will regulate these short-term rentals (such as rooms and houses rented on platforms like Airbnb and VRBO) in the same way as the motel and hotel industry.

Booking platforms like Airbnb and VRBO are required to report information four times a year to New York state, including a full list of rentals and taxes collected by county in the state. Designed by New York state lawmakers to alleviate the housing crisis, the law defines a “short-term rental” as a residential unit rented for less than 30 days.

The law also requires owners or operators of short-term rental properties to register with the state or local Department of State, and booking platforms must collect and remit appropriate taxes.

Any booking platform that facilitates short-term rentals in the state must also verify registration and registration numbers, and must remove from the platform any locations that are not registered with the government.

These are also the first laws in the US to regulate this type of business. New York State believes that enacting laws to regulate short-term rental services is necessary, as this service has been largely unregulated and only partially taxed in the past.

Must be in harmony with the interests of residents living in the apartment building.

According to Dr. Huynh Phuoc Nghia - Director of the Center for Economics, Law and Management (CTELG), in the context that Ho Chi Minh City is a leading locality in tourism and is promoting the attraction of tourists, having a specific mechanism, a pilot mechanism to allow suitable apartments to do business in some services and exploit short-term accommodation services in apartment buildings is a reasonable approach.

A series of shops and restaurants are operating in an apartment building on Nguyen Hue Street (District 1, Ho Chi Minh City), becoming a popular business destination for tourists - Photo: THANH HIEP

"However, it is necessary to consider the possibility of allowing the pilot expansion and conditions that may lead to legal adjustments for these services. There should be specific regulations so that these activities can both bring positive effects to economic development and ensure security, safety and harmony with the lives of people in apartment buildings," Mr. Nghia suggested.

A representative of an apartment building operator said residents often react to short-term guests because the number of guests traveling and using shared services and facilities is higher, so people are concerned about security and wear and tear on facilities.

Therefore, this person believes that in case accommodation services are allowed to operate, it is necessary to limit the areas that short-term guests can use. Service providers must bear higher management and maintenance fees than residents and must be responsible for guiding guests to ensure compliance with regulations.

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