Accommodation in Japan: New home-sharing law doing more harm than good

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Japan is enjoying an influx of tourists ahead of the 2020 Tokyo Olympics. But that's raising a major problem, a lack of accommodation for visitors. The Japanese government is stepping in to ease room shortages and provide safe lodging. But the new regulations may be doing more harm than good. Mayu Yoshida reports.

Kenta Hikino and his mother were in for a surprise a week before their departure to Tokyo. That's because their Airbnb reservation was canceled after a new home-sharing law went into effect in June. Airbnb has canceled thousands of reservations and pulled listings from its website in response to the law.

KENTA HIKINO TOURIST "It's definitely frustrating not to really know about this prior to I guess planning and booking our stay here."

The measure is known as the private temporary lodging, or 'minpaku', law. The law requires hosts to register with the government and follow strict guidelines and rules.

MAYU YOSHIDA TOKYO "Hosts can rent out rooms for just 180 days per year under the new law and they also need to install the latest sprinklers, fire alarms and other facilities in each room. Experts say the new law is doing more to hurt than help. They say increased paperwork and stricter rules are stifling home-sharing businesses in Japan."

RYOJI OHASHI ATTORNEY, ISSHIN PARTNERS "After the law, we received many inquiries from hosts about how to operate legally. But most of them ended up selling their rooms due to high upfront costs and strict regulations. The new law is too strict for them to continue home-sharing as a business."

Hosts say the new rules make it difficult to turn a profit. Some owners are bypassing the new law by applying for a hotel license instead. Long-time Airbnb host Yui Kanazawa stopped renting out Airbnb apartments and instead opened a hotel in Tokyo.

YUI KANAZAWA HOTEL OWNER "Yes, Airbnb was fun, on the other hand, it was quite grey. That was an area I was always thinking about, and I was enjoying to rent my place, but I could not do professionally because of the law. So, I decided to, because it was so fun to share the room with young people. so I just thought of moving this to a professional level and open up a hotel by being 100 percent legal."

However, not everybody has the means to apply for a hotel license. And with Japan set to host the Rugby World Cup next year and the 2020 Summer Olympics, visitors to the country will likely continue to grow. And to accommodate these visitors, the hope is if they build it, they will come. MAYU YOSHIDA, Tokyo.