"Enterprising" or Simply "Disgusting"?

[Karen]

So this guy in the Silicon Valley is renting out a tent in his parents' backyard for $31 per night on Airbnb and business is apparently booming.

http://www.dailymail.co.uk/news/article-3143433/Enterprising-Silicon-Valley-man-rents-tent-parents-backyard-899-month.html

I was telling my husband about this article the other day, thinking that this guy had some ingenuity and entrepreneurial spirit to offer such a solution to extortionate hotel costs for new tech workers who are looking for a permanent place to live.

My husband, however, was having none of it.  He thought it was absolutely disgusting what this guy was doing.  He said this guy was taking advantage of a bad situation for the sake of profit.  As no one would CHOOSE to pay money for use of a tent in a stranger's suburban backyard, they would only do so because they felt completely stuck and powerless to do anything else. 

He said just because this guy can get away with it doesn't make it "right" in a humanitarian sense.  He likened it to underpaid and mistreated sweatshop workers.  Just because people are lining up to have these jobs doesn't make it right to exploit desperate workers by providing inadequate pay and poor working conditions. 

He ended his rant by saying that this guy had absolutely nothing to be proud of in the way he was earning his money - by taking advantage of others' worse situation. 

Until now, I had never thought of it in that way and I can see that my husband certainly has a point.  What's scary though is realising that ALL of society operates in this way.  This is why housing is so extortionate.

What do you all think about this? 

[arebelspy]

Every monetary transaction is an exchange of value. I see nothing any worse with this one than any other one, such as buying an apple at a farmer's market.

If people are entering into it of their own free will, and are getting value out of it, and enjoy it (which would be reflecting in his reviews/rating on AirBnB) who are we to judge it?

I do see it as a bit more creative, because it's less common.  Not terribly so, on both counts, but slightly.

[CCCA]

Camping in California's state parks are also about $30/night. So this guy isn't charging a ridiculous amount.

Also if he was charging a lower rate like say $10/night. Would it still be disgusting?

[GueroKC]

I'd vote for "Enterprising". The moral calculus of offering a cheap living arrangement to some of the highest paid workers in the world who have other options (including getting jobs outside of the area) is very different in my mind than profiting from offering shanty-town conditions to poor, disadvantaged people who have few viable alternatives.

[sol]

To be fair, it's not $31/month for a tent.  It's $31/mo for use of his house and bathroom and shower and yard, breakfast included every day, and a tent for sleeping in at night.  This seems much more like a "roomate who sleeps outside" kind of situation.

And I think that comparing sweatshop workers to Silicon Valley tech workers is pretty insulting to them both, for different reasons.

[Karen]

I personally don't really have a problem with what this guy is doing and I think "good on him" for seeing a niche in a market.  My husband has the problem, but he also has moral problems with charging money for anything (hence, he is not an entrepreneur!).

I think if this guy charged $10 per night, he could be subjected to some unsavoury guests.

I asked my husband what the alternative was.  He said that's not the issue.  The issue is the desperation of people to get jobs in the Silicon Valley and that a situation like this has been allowed to flourish because of greed, both of people looking for the big bucks and the people looking to capitalize on those wanting the big bucks.

[Tabaxus]

Should increase the price. 

[Katsplaying]

Of course alternatives are an issue. Part of trying new things is considering as many issues as possible before they arise and wreak havoc on your life.

For me it's all about consent: the homeowner consents to share his yard/house/facilities and the renter consents to the stated conditions. As long as everyone is an adult with cognitive faculties intact, it isn't anyone's business. Carefully crafted rental agreements serve everyone.

One concern might be the neighbors' & city zoning dept's response to semi-permanent campers in that backyard but with properly vetted, good tenants, probably no one would really know.

Charging money is NOT a crime or a moral failing. Understanding the worth of your own time, money, energy, resources, and flexibility is critical to personal prosperity.

[BlueHouse]

I thought the "disgusting" part was going to include a description of the guests having to urinate/defecate in the yard. 
So no, I don't think it's disgusting. 

[Karen]

Charging money is NOT a crime or a moral failing. Understanding the worth of your own time, money, energy, resources, and flexibility is critical to personal prosperity.

I like that!  I'm going to tell that to my husband when he wakes up!

[mozar]

What bothers me is that its not his house, its his parents. So I hope they are getting a cut.

[oinkette]

I think what is disgusting is that housing in Silicon Valley has got so inflated that this is actually a viable (and apparently booming) business model. One wonders what the lower income folk are doing out there...or basically anyone not in the tech industry.

[nobodyspecial]

a situation like this has been allowed to flourish because of greed, both of people looking for the big bucks and the people looking to capitalize on those wanting the big bucks.

A free market solution would be to allow people to build housing to meet the demand for places.
Instead people who own nice SF houses get to block building condo towers - so increase the value of their homes.

The free market also says that at some point companies keep their HQ SF but move their staff to Portland, or Boise or Berlin.

[Cougar]

What bothers me is that its not his house, its his parents. So I hope they are getting a cut.

second.

[Roland of Gilead]

Every monetary transaction is an exchange of value. I see nothing any worse with this one than any other one, such as buying an apple at a farmer's market.

If people are entering into it of their own free will, and are getting value out of it, and enjoy it (which would be reflecting in his reviews/rating on AirBnB) who are we to judge it?

Funny you just described the scenario in "Hot Girls Wanted" (free will, value) where you seemed to be against the "exploitation".

I guess it isn't exploitation when it involves real estate (wink).

[WildJager]

I think what is disgusting is that housing in Silicon Valley has got so inflated that this is actually a viable (and apparently booming) business model. One wonders what the lower income folk are doing out there...or basically anyone not in the tech industry.

I hear that same complaint from friends complaining about the price of living in New York.  If people are willing to pay higher prices, those prices will rise.  Get over it.  If you can't keep up, move out.  There is plenty of land in the US.

I don't think the concept of sweatshops are disgusting from a purely economical standpoint.  People are choosing to work there, so that means on the whole the option is better than the alternative.  What is more disgusting to me is when rich westerners shut down such shops becasue they consider the value poor, hence increasing overall poverty since the workers then become jobless.  Sometimes life doesn't fit into our neat little packages that we'd prefer.  I'd rather have bread on my table than going to bed hungry because someone thought my living conditions were poor.

And I'd rather rent my New York apartment for more money than less, becasue it's an asset. 

We live during the best world economic system of all time.  It's not perfect, but we're learning.  Until then, people will make do as necessary.  Rolling in with ideals without solution won't help anything but your own ego.

[sol]

I don't think the concept of sweatshops are disgusting from a purely economical standpoint.

I do.

Rolling in with ideals without solution won't help anything but your own ego.

Okay, how about this for a proposed solution:  the US refuses to import any goods from any country without a targeted minimum wage.  Prices for cheap goods would increase for rich westerners, profits would decrease for overseas sweatshop owners, and poverty-stricken sweatshop workers would become their country's new middle class, maybe even able to afford the same items they make all day and thus starting the virtuous cycle of capitalism in a new market.

The current system is clearly exploitive.  Western markets support that exploitation by demanding cheaper goods, in the name of the free market, without realizing that our doing so prevents the economies of these countries from developing normally, as ours did.  We're ensuring that these people stay poor for generations, while we work our white collar office jobs for 12 years and then retire to a life of luxury supported by their hard labor.  So my "ego", as you put it, isn't so worried about feeling superior because we are already so fortunate.  It's more concerned with spreading a little equality, or at least not using my vast wealth to spread inequality.

[arebelspy]

Every monetary transaction is an exchange of value. I see nothing any worse with this one than any other one, such as buying an apple at a farmer's market.

If people are entering into it of their own free will, and are getting value out of it, and enjoy it (which would be reflecting in his reviews/rating on AirBnB) who are we to judge it?

Funny you just described the scenario in "Hot Girls Wanted" (free will, value) where you seemed to be against the "exploitation".

I guess it isn't exploitation when it involves real estate (wink).

[Reply moved to other thread to keep this on topic.]

[Zamboni]

This is what local laws and neighborhood restrictive covenants are set up to prevent. If you choose a neighborhood where camping in a yard is legal and not against any rules, then you can't be upset if someone decides to let visitors camp in their yard.

[WildJager]

I don't think the concept of sweatshops are disgusting from a purely economical standpoint.

I do.

Rolling in with ideals without solution won't help anything but your own ego.

Okay, how about this for a proposed solution:  the US refuses to import any goods from any country without a targeted minimum wage.  Prices for cheap goods would increase for rich westerners, profits would decrease for overseas sweatshop owners, and poverty-stricken sweatshop workers would become their country's new middle class, maybe even able to afford the same items they make all day and thus starting the virtuous cycle of capitalism in a new market.

The current system is clearly exploitive.  Western markets support that exploitation by demanding cheaper goods, in the name of the free market, without realizing that our doing so prevents the economies of these countries from developing normally, as ours did.  We're ensuring that these people stay poor for generations, while we work our white collar office jobs for 12 years and then retire to a life of luxury supported by their hard labor.  So my "ego", as you put it, isn't so worried about feeling superior because we are already so fortunate.  It's more concerned with spreading a little equality, or at least not using my vast wealth to spread inequality.

I wouldn't necessarily say it's explotive from the viewpoints of individual companies.  They are providing products in the most economical way possible so they can make a profit.  I read "Naked Economics" about three years ago, so my memory of the details are a bit fuzzy, but from what I remember it went like this.  They used t-shirt making as an example.  The margins on shirts are so tight that they rely on cheap labor to make any profit.  When regulation came into place to "save" the people working at sweat shops of a particular country, the shirt manufacturers were forced to outsource elsewhere in order to remain solvent.  The unintended side effect was that the workers of said country lost their jobs, hence their livelihood.  They went hungry, and the system of cheap t-shirts with cat pictures on them remained. 

Eventually the wages will always be "unfair" to the point where it becomes cheaper to in-source t-shirt production rather than ship products around the world.  For countries that don't have natural resources to take advantage of (if all they have is human capital, not to mention a corrupt government), then they are simply out of luck. 

The "ego" comment refers to how we as a species often feel better when we "help" the impoverished, but too often we don't follow up with the second or third order effects of our actions.  I recognize that we are fortunate to have white collar jobs, but taking away opportunity just because it doesn't appeal to us doesn't help people as much as we would like to think.

[partgypsy]

I honestly don't see how this is "disgusting" , especially if they are allowed to use the facilities in the main house. California climate is awesome! It's not like they are doing this in Chicago. The people who are doing this are educated. They are doing it of their own free will, because they prefer that option to whatever other options they have, including multiple roommates, more expensive housing, or living farther away and commuting. I would think of all places the MMM people would be supportive.

People have even been known to gasp! tent on vacation.

[Bob W]

This is a great niche market.   I'm surprised it isn't more available on AirBnB?

I have often thought that throwing a self built 300 sq ft "storage shed" behind the house would be a cool idea.   It would have a window unit,  water and water heater, nice kitchen/bath and a sleeping loft.    In our area, in the college town, it would rent for about $250 a month.   That doesn't sound like much until you consider that it could be built for around 4-5K in materials.   So a 55% return on investment.

Something for fellow mustachians to consider.   4 of these in the back yard could generate enough to fund my lifestyle.   

I'm voting enterprising and something to consider.

[sunday]

Have many friends that work in Silicon Valley and we were discussing this the other night. Actually, we thought it was $60 a night and that it was a "steal". So for $30 a night in Mountain View, it's practically free.

[sunday]

And not only is it enterprising, and not disgusting, but it's a hell of a service. Beats riding the company bus 1.5 hours each way into some 300 sq ft hole charging $2000 a month.

[immocardo]

I don't think the concept of sweatshops are disgusting from a purely economical standpoint.

I do.

Rolling in with ideals without solution won't help anything but your own ego.

Okay, how about this for a proposed solution:  the US refuses to import any goods from any country without a targeted minimum wage.  Prices for cheap goods would increase for rich westerners, profits would decrease for overseas sweatshop owners, and poverty-stricken sweatshop workers would become their country's new middle class, maybe even able to afford the same items they make all day and thus starting the virtuous cycle of capitalism in a new market.

Country A = U.S.
Country B = Country with minimum wage
Country C = Country without minimum wage

Your solution suggests that A can only interact with B.

What is to stop B from buying from C and selling to A for a profit?

[sol]

What is to stop B from buying from C and selling to A for a profit?

I had the same thought, and I'm glad somebody else is actually reading along and thinking about these issues.

There would certainly be complications to work out, and I don't pretend to have all the answers.  You don't fix something as broken as sweatshops and global trade with a single sentence solution like the one I proposed. 

Even if we instituted strict controls over imports to prevent problems like the one you cited, it wouldn't stop individual Americans from flying to SE Asia to by discounted goods, just like it doesn't stop individual Americans from flying there to buy underage prostitutes.  I still think we should have rules against it, even acknowledging that the rules can be circumvented.

[forummm]

I don't think the concept of sweatshops are disgusting from a purely economical standpoint.

I do.

Rolling in with ideals without solution won't help anything but your own ego.

Okay, how about this for a proposed solution:  the US refuses to import any goods from any country without a targeted minimum wage.  Prices for cheap goods would increase for rich westerners, profits would decrease for overseas sweatshop owners, and poverty-stricken sweatshop workers would become their country's new middle class, maybe even able to afford the same items they make all day and thus starting the virtuous cycle of capitalism in a new market.

The current system is clearly exploitive.  Western markets support that exploitation by demanding cheaper goods, in the name of the free market, without realizing that our doing so prevents the economies of these countries from developing normally, as ours did.  We're ensuring that these people stay poor for generations, while we work our white collar office jobs for 12 years and then retire to a life of luxury supported by their hard labor.  So my "ego", as you put it, isn't so worried about feeling superior because we are already so fortunate.  It's more concerned with spreading a little equality, or at least not using my vast wealth to spread inequality.

I wouldn't necessarily say it's explotive from the viewpoints of individual companies.  They are providing products in the most economical way possible so they can make a profit.  I read "Naked Economics" about three years ago, so my memory of the details are a bit fuzzy, but from what I remember it went like this.  They used t-shirt making as an example.  The margins on shirts are so tight that they rely on cheap labor to make any profit.  When regulation came into place to "save" the people working at sweat shops of a particular country, the shirt manufacturers were forced to outsource elsewhere in order to remain solvent.  The unintended side effect was that the workers of said country lost their jobs, hence their livelihood.  They went hungry, and the system of cheap t-shirts with cat pictures on them remained. 

Eventually the wages will always be "unfair" to the point where it becomes cheaper to in-source t-shirt production rather than ship products around the world.  For countries that don't have natural resources to take advantage of (if all they have is human capital, not to mention a corrupt government), then they are simply out of luck. 

The "ego" comment refers to how we as a species often feel better when we "help" the impoverished, but too often we don't follow up with the second or third order effects of our actions.  I recognize that we are fortunate to have white collar jobs, but taking away opportunity just because it doesn't appeal to us doesn't help people as much as we would like to think.

There's a ~10 podcast series that Planet Money did where they created their own t-shirt and followed the entire process from cotton farm to end product. It's all very interesting (like all their stuff). The cons of sweatshop labor are clear. The pros of the current system are that it can be part of a country improving its economy, and then graduating to better and better goods until they are a developed country. South Korea is one example they provided. China is another where it's graduated from textiles and on to other products because their standard of living has improved so much that the labor is too expensive relative to other countries.

One complication of the minimum wage approach is--who sets the minimum wage? If it's the manufacturing country, then that's not doing anything really--some country will set it lower than the market rate. If it's the US, and the rate is substantially higher than the market rate, then every country will want the business. How will we decide which country gets the work? Will kickbacks and bribes be involved? If the rate is high enough, it might come back to the US, or be totally mechanized--and then all those people elsewhere are out of work.

[kpd905]

Sounds pretty similar to subletting a room in your house, especially since they have access to a shower, daily breakfast and wifi.  I guess I just don't see sleeping in a tent as a bad thing, so I see nothing disgusting here.  I slept in a closet and a tent for about six months between leases.

[The_path_less_taken]

I doubt he'll get to do it once it's common knowledge: neighbors or the health department and the zoning department will step in and boot them out.

But like Bob says, a tasteful "casita" or tiny home setup wouldn't necessarily harm the neighbors or affect their property values.

As for the ethics: I don't think it's exploitive so much as sad. To me, it's a lack of critical thinking on the part of the people renting it from him.

Why? Because they could be night watchman (many places, trust me) or work as an au pair or house sit and get paid for sleeping for the most part. Babysitters and dog sitters are paid to spend the night...

Difficult to line up 'daily' but by the same token...you could also cut a deal with someone who doesn't want a 'full time' roommate but is willing to let you stay a few days a month in exchange for yard work/house work or whatever.

Personally, I would (and have, in the past) just buy a normal cargo van and sleep in it in stealth mode.

[dudde_devaru]

This reminds me of the bnb I stayed in Miami for 2 nights. Tent in a beautiful garden-backyard in the middle of Miami! The guy had 7 tents setup and on one night there were guests from 5 different countries. The airbnb owner was a dad of 2 kids and 2 beautiful dogs! He said he rents the 7 tents almost 25+ days a year and also in KeyWest/Largo having a similar tent facing the beaches.

PS: Not promoting the listing! He sold the property last month!

[sunday]

Doubtful the renters would want to work as a night watchman or a babysitter if they're renting a tent in Mountain View. These people likely have high paying tech jobs. The reason the tent rents out for that price is because it's walking distance to Google.

[sunday]

http://www.npr.org/2015/07/02/419554799/man-offers-cheap-housing-in-silicon-valley-by-renting-out-backyard-tent

Looks like it's now $46/night, and renters are split between vacationers and tech workers.

[The_path_less_taken]

http://www.npr.org/2015/07/02/419554799/man-offers-cheap-housing-in-silicon-valley-by-renting-out-backyard-tent

Looks like it's now $46/night, and renters are split between vacationers and tech workers.

Valid point about the not wanting to work some other free type sleeping arrangement.

But in NV you can rent a shitty hotel room for that. And (while I wouldn't appreciate the meth addict neighbors), they even rent shitty studio apartments that would be less than that. And have a real bed/tv/fridge/private shower/bath.

But having walking distance to work is worth a lot of value in high commute time areas I guess....wouldn't be my first choice though.

[morning owl]

I find it hard to see how this arrangement could be disgusting. It's pretty ingenious, IMO!

He's only taking advantage of the fact that it's hard to find cheap accommodations in his area. This is clearly something people want, so he's in business. If people didn't want it, he wouldn't be doing it. Nobody is being taking advantage of here.

This is no comparison to a corporation taking advantage of economic climates / lax political policy to run a sweat shop. Sweat shops are wrong because people are getting rich off the backs of others' cheap labour. There is clearly someone suffering, and someone who is acting unjustly by underpaying and overworking desperate people.

Who, in the case of the backyard accommodations, is suffering? Maybe I don't see how sleeping in a tent and getting a cheap place to stay is a form of suffering, since I like sleeping in tents, and I like cheap places to stay :)

[mm1970]

Camping in California's state parks are also about $30/night. So this guy isn't charging a ridiculous amount.

Also if he was charging a lower rate like say $10/night. Would it still be disgusting?

Pretty much this, and in that case, you have to bring your own tent.  For example, our local state parks camping start at $48/night at the beach, or maybe $37 at the lake.

And you still have to bring your own tent.

[slugline]

Every person that stays in a tent like that represents one fewer buyer/renter inflating demand and prices in the housing market. I just hope Potter's parents are benefiting from the arrangement since its their property, after all.

Since there's such opposition to the visual blight of denser housing buildings, I can't help but wonder if SF could develop a market of subterranean residential units that no one can see on the surface. That is, if folks aren't spooked by the possibility of being underground when an earthquake hits. . . .

[cloudsail]

I saw this and totally wanted to do it!!!  Except we only have one shower in our house and it's upstairs.  Our backyard is large enough to fit at least two tents.  We live in prime Silicon Valley real estate, within biking distance of a bunch of a big companies and startup hubs.  The income would probably be enough to cover my childcare costs!  Though it would probably be frowned on by the HOA.

Ah well, it was nice to dream about.

[OttoVonBisquick]

This inspired me to see if I could list my room with a private bathroom on AirBnB for my trip to Vegas come August. Could recoup a good chunk of the costs of travel...

As for the renting? Totally fine. And I mean that as in "This is not only okay, I think it's fine and encourage these kinds of solutions". It seems like all parties win here. As someone previously said: If they don't like it, they can move. Obviously "But their job/life/etc. is here! They can't just up and leave!" is pretty valid but, again, if you're struggling to find such a good living situation and value living conditions so highly, I imagine there are spaces elsewhere that can better fit your desires. If not, then maybe your desires are out of line with what can be realistically expected.

(Also, [TOMORROW!] 22-year-old naivete disclaimer so old-timers don't get mad at me)

[nobodyspecial]

It seems like all parties win here.

Except there are parties that are affected that aren't party to the deal - uncosted externalities in econo-speak.
If you start parking dozens of tents / RVs on your suburban lot you are going to be negatively impacting your neighbors, effectively costing them without them gaining from the deal - same as turning your apartment in a condo into a full time hotel with AirBnB.

[Eric]

It seems like all parties win here.

Except there are parties that are affected that aren't party to the deal - uncosted externalities in econo-speak.
If you start parking dozens of tents / RVs on your suburban lot you are going to be negatively impacting your neighbors, effectively costing them without them gaining from the deal - same as turning your apartment in a condo into a full time hotel with AirBnB.

What?  How does having a tent in your backyard affect your neighbors?  There are things that you're allowed to complain about.  What your neighbor does in the privacy of his backyard isn't usually one of them.  I mean, it's NIMBY not NIYBY for a reason.

[nobodyspecial]

If it's one tent in a backyard - yes
When they are running essentially a trailer park for commuters = dozens of people, noise, car parking, extra traffic it does affect the neighbors.