The growing popularity of residence-sharing websites could have an effect nationally and also on Iowa City hotels.

A Boston University study showed that in places in which Airbnb has established a presence, it cut revenues of cheaper hotels by 5 percent from 2012 to 2013.

The study estimates that by 2016, the loss will be as high as 10 percent.

These sites allow homeowners and residents to rent out single rooms and entire residences for predetermined periods of time. 

Iowa City requires hosts to obtain a $110 bed-and-breakfast permit that lasts two years.

Stan Laverman, the Iowa City senior housing inspector, said the most popular locally are Airbnb, Vacation Rentals by Owner, Craigslist, and Hawkeye Football Rentals.

“Probably in the last five years, we’ve seen an increase in that sort of market,” he said. “We look at Airbnb the same way as other hotels with limits on how many people can be there along with the standards for health, life, and safety.”

There have been many stories of guests damaging the hosts’ properties.

In October, Business Insider reported an incident in which a guest caused more than $10,000 in damage by flooding the entire floor of a condominium complex.

Owners remain liable in the case of an accident.

Dawn Wells, a local insurance agent with Allstate, said average homeowner’s insurance typically provides $100,000 to $500,000 in liability coverage.

“It just depends on if you are operating as a business on a regular basis,” she said. “It would be the same type of insurance, but it would be a business policy that covers more specific things that may not be on a regular homeowner’s policy.”

Thomas McInerney, who owns Iowa City’s Plum Grove Inn, said it’s easy for users to avoid city inspections and obtain permits.

“In flyover country, where we live, it’s not a big deal, but it has affected the business,” McInerney said.

He said that so far, things have not changed dramatically, but they will as accessibility and efficiency increase.

He also argued the name is misleading because many of the hosts do not provide breakfast.

“It’s easier for people to go autopilot, but some people want a different experience where people actually serve you breakfast,” McInerney said. “It’s the real thing. It’s more personal.”

Some owners of existing bed-and-breakfasts have opted into using the website to grow their existing revenue.

Krista Clark, the owner of Spear House Barn and Bed and Breakfast in Tipton, said she found Airbnb on the web two years ago and thought it looked like a good way to make her establishment’s presence known.

She has had few to no complaints about operating through Airbnb.

“I think that people have had concerns about being substandard or not meeting local housing requirements,” she said.

Many members of the University of Iowa community use the site while abroad.

Aubree Compton, a UI Study Abroad adviser and program coordinator, said that while traveling independently, she doesn’t necessarily need all the amenities of a hotel, and on occasion, she found it to be significantly cheaper.

“I think people really like the idea of staying in an apartment and getting to know a city like a ‘resident,’ ” Compton said.

UI senior Jayne Blumhardt has used the site in both the United States and while abroad. She heard about it from her brother while she was living in Germany, and she has yet to have a bad experience.

“Sometimes it sucks when the person you are renting from isn’t good at communicating because then it’s complicated to get your stuff, but I’ve always had great experiences,” Blumhardt said.

UI senior Leila Mustafa, who used the site while traveling in Spain, became aware of it through word of mouth while taking part in Camino de Santiago, a hiking trip she took while abroad.

“I mean, you don’t really know whose home you’re going into,” she said. “You could go into someone’s home that doesn’t want any noise or for you to be out late. Or you could be somewhere awesome, like all of my experiences.”