The charms of Japan, from cherry blossoms to tea ceremonies, are legion. However, for tourists, the lure of the archipelago is tempered by the often eye-watering costs of travel, amongst which accommodation costs rank first. Ryokan, traditional Japanese inns, charge per person, which can translate to hundreds of dollars per night for a family of four for a compact, no-frills room. In this travel scenario, Airbnb accommodation has been a saviour for both the budget-conscious and the many visiting families. Until recently, the home-sharing site had 62,000 listings for Japan. But over the past few weeks, this number has been slashed by nearly 80%, just ahead of the summer holiday-crush, leading to considerable disarray in the country’s travel market.
Restrictions on duration
The reason for these large-scale cancellations is a new, “private temporary lodging” law, which came into force on June 15, and requires hosts to register with the government, something that a vast majority of Airbnb home owners have not done. The new law also limits home sharing to 180 days a year and leaves it local governments to impose further restrictions as they see fit. One of Japan’s most popular tourist destinations, the temple-town of Kyoto, for example, has said it will only permit standard rentals in residential areas between mid-January and mid-March, the low season for tourists.
The Japanese government says the new rules are needed to regularise a legal grey area and to ensure that the practice is not disruptive for others in the neighbourhood. Rentals in residential areas in Japan often generate complaints from neighbours who say that visitors can be noisy and pose security concerns. The Japanese media have covered stories about locals complaining of the inability of tourists to follow the byzantine trash-sorting rules in Japan. (Municipal recycling manuals can run to two dozen pages with instructions on how to sort up to 500 items, ranging from lipsticks to aluminium foil.)
For Airbnb, one of the world’s most valuable private businesses, the forced cancellation of 80% of its Japan listings is only the latest amongst several speed bumps it has encountered in the region. Earlier this year, the company said it would start sharing information about its customers who book accommodation in China with the Chinese government, including passport details and the dates of bookings.
There is a huge potential market for short-term rentals in Japan, which is in the midst of a historic tourism boom. In 2017, 28.7 million tourists visited the country, up from 10.4 million in 2013. The government is targeting massive numbers of 40 million annual tourists by the time of the Tokyo 2020 Olympic Games. The challenge is to keep up with the infrastructural needs that such a spike in overseas visitors necessitates, including by preparing the hotel rooms. In early 2017, the Mizuho Research Institute forecast a shortage of 10,000 rooms in 2020 if foreign tourists continued increasing in number at the same rate. More recently, it changed this forecast, saying that shortages would be met, in large part because of the growth of private rentals through channels like Airbnb.
But the new law now raises concerns that the rental market won’t be able to take up the slack. Some analysts say that after a short period of teething pains, the law will actually help stabilise and streamline the market to its own benefit. But whether this happens in time for the 2020 Olympics remains the 40-million tourist question.
Pallavi Aiyar is an author and journalist based in Tokyo.
