Over the last few weeks, companies and leaders across the US have announced efforts to stand in solidarity against systemic racism and police violence targeted at Black people. At TurnKey, we have taken this time to reconsider how we can make a bigger impact in undoing discrimination in short-term rentals and are committed to a much longer journey of prioritizing Black stories, facilitating more conversations, and taking real action at our company.
In celebration of Juneteenth, the 155-year-old holiday celebrating the emancipation of African-Americans from slavery in the confederacy, we’re exploring discrimination in the STR industry and committing to help make the travel industry a safer place for our guests and employees.
A history of housing discrimination
Housing discrimination in the US has a long and complicated history that stretches back to slavery, and it has been reinvented ever since.
As of 2016, the median African American family had only 10.2 percent of the wealth of the median white family ($17,409 versus $171,000). There are many reasons that this large gap exists, but much of it is due to the remnants of Jim Crow laws and America’s history of mortgage market discrimination, where practices like “redlining” and gentrification impact Black communities to this day.
The Federal Housing Administration
Before 1934, the federal government was not involved in housing. The Federal Housing Administration (FHA), was created as part of the New Deal to encourage homeownership after the Great Depression. However, instead of creating policies to make housing more equitable, the FHA did the opposite by primarily offering housing to white middle-class and lower-class families.
According to Wikipedia, redlining is,” the systematic denial of various services by federal government agencies, local governments as well as the private either directly or through the selective raising of prices.” To put this definition in a better context, redlining was coined in the 1930s during the Great Depression, when the Government created a color code system to mark areas that were considered ‘safe’ to offer loans. Green was marked as the safest group to refinance, then blue, yellow, and finally red (which was deemed “hazardous”). Of course, the areas in red are where Black people lived.
The exclusion of Black people in the developments from The New Deal led to decades of disinvestment in Black communities. And though the discriminatory practice was outlawed in 1968 with the passage of The Fair Housing Act, it continues informally today.
The Fair Housing Act of 1968
In response to the Civil Rights Movement, The Fair Housing Act of 1968 was born as an effort to end racial discrimination in mortgage and lending in the US, including redlining. Unfortunately, like many well-intended policies that ignore the root cause, discrimination has continued in other forms.
An impact still felt today
The long-term effects of racial discrimination in US housing policies have led to extreme wealth inequality between Black and white counterparts. According to data in Richard Rothstein’s book, “The Color of Law,” African American incomes on average are about 60 percent of average white incomes, but only 5 percent of white wealth. This 60 percent income ratio and 5 percent wealth ratio is almost entirely attributed to the systemic racism facilitated by the FHA throughout the 20th century.
Today, many neighborhoods continue to feel the impacts of redlining and segregation, and years of enforcing these practices have created a society that accepts— and on some level expects— discriminatory practices.
In fact, 42 years after the Fair Housing Act was enacted, an investigation by the United States Justice Department found that the financial institution Wells Fargo had been using policies that restricted loans to certain racial groups. History has shown us that just because racial bias is no longer “legal,” it still happens. The solution, then, is to address the root cause of racism, starting with the individual and working towards making equality the new norm.
Discrimination in short-term rentals
At around the same time our founders started TurnKey, a Harvard study showed widespread discrimination among Airbnb hosts. The study showed a pattern of hosts turning away guests based on their name or profile picture. Unfortunately, seven years later, this is still happening.
The Harvard researchers posited that online sharing platforms often share information “not only about products, but also about the people selling the products” in an effort to facilitate trust. For Airbnb, this includes personal profiles and with the option of uploading your own photo. The study and subsequent studies have found strong evidence to support that these features “may also facilitate discrimination based on sellers’ race, gender, age, or other aspects of appearance.”
In 2015, a viral hashtag #airbnbwhileblack took over Twitter with Black travelers discussing their experiences with hosts on the sharing platform. According to Vox, the hashtag first emerged in July 2015, when a Twitter user named Quirtina Crittenden discovered she was consistently being declined by hosts on Airbnb. Quirtina revealed in an interview on the NPR podcast Hidden Brain that she ended up shortening her name to “Tina” and changing her profile photo to a generic landscape photo in order to be accepted.
While Airbnb has taken steps towards ending discrimination on its platform, racism in the short-term rental industry is a subject that has been largely overlooked and is rarely talked about.
In 2012, TurnKey co-founders John Banczak and T.J. Clark wanted to create a company that operated both fairly and logically. After trying a system through Airbnb that used photo ID verification in the booking process, they determined that not only was this process not fair, it wasn’t the most effective way to verify a person.
In response, some of the ways the company updated the process was through:
- Making all homes fully bookable through instant booking
- Only screening guests for age
- Removing photo verification and replacing the former system with IDology, a digital identity verification and authentication solution
- Using a background check software to verify that a person is who they say they are
From the very beginning, TurnKey deliberately set up the booking and verification systems to remove names and profile pictures to avoid any potential discrimination in the process.
From removing photo requirements in the booking process to featuring more Black families in travel stories, there are many ways the STR industry can work to undo discrimination and prioritize diverse storytelling.
As innovators in the travel industry, it is up to the STR sector to be the changemakers … to not only reduce discrimination but to be actively anti-racist in our operation of vacation rentals, and in life.