Brandon Donnelly — Daily insights for city builders. Published since 2013 by Toronto-based real estate developer Brandon Donnelly. — Page 783

Wired recently published a long read called, " I stumbled across a huge Airbnb scam that’s taking over London ." Apparently the people who do these sorts of things on the platform (things that are both illegal and questionable) call it "systemizing." This is the process of trying to create scale. Secure lots of units. Create a bunch of fake/duplicate accounts. And try and maximize revenue.

This obviously runs counter to Airbnb's mission of "authentic places", "community", and "local hosts." But as Benedict Evans points out in his latest newsletter, "where there is money and people, there will be scams ." And Airbnb is obviously doing everything it can to quash this kind of activity, especially as it prepares for a possible IPO this year. The company has a policy of zero tolerance.

Fraud and government regulation are likely to be the two biggest kinks to work out as the company gets ready for public consumption. I am sure an equilibrium will be found; it's just going to take some time and a few lawyers. It goes to show you just how challenging startups can be when you combine digital (tech) and physical (real estate).

Building new housing — in the places that really need it — is exceedingly difficult. This recent New York Times article by Conor Dougherty is a good example of that. It tells the story of a man named Steve Falk.

Steve was previously city manager for Lafayette, California (a suburb of San Francisco), but he eventually grew frustrated by his inability to affect positive change, and actually build things. He ended up resigning.

Below is a quote from the article. Steve is talking about housing affordability and supply.

“I’m not sure individual cities, left to their own devices, are going to solve this,” he told me once. “They don’t have the incentive to do so, because local voters are always going to protect their own interests instead of looking out for people who don’t live there yet.”

Steve is right in this assertion. I think it was Charlie Munger who once said, “Show me an incentive and I’ll show you an outcome.”

I don’t know the specifics of the proposed 315 unit apartment building in Lafayette (perhaps it was ugly), but the article claims it was an as-of-right proposal close to a BART station (transit).

How does that turn into 0 units and numerous lawsuits, while we all continue to debate housing affordability? Something is broken.

There's a lot of data/speculation out there about the impact of ride-hailing apps. Many dense urban centers are claiming that they have increased traffic (slowed average speeds) and pulled people away from public transit. The University of Toronto published this study last year. And the WSJ recently published this chart for Chicago:

To be honest, I'm not sure how much of the above is a result of ride-hailing apps, overall urban growth, e-commerce deliveries , public transit disinvestment, or other factors. But what is clear is that ride-hailing is pretty convenient and most (if not all) cities are seeing massive growth in this space.

But all of this feels to me like a bit of a red herring. People will obviously choose what is most convenient and relatively affordable. And congestion was a problem well before people started using these apps (demand > road supply). The only solution I have seen work is to price congestion/roads.