the fact that these folks exist is essentially the market arguing that there are inefficiencies in government regulation of the hotel industry
The "inefficiency" you've spotted is that a business which ignores all rules, regulations and taxes will have a huge competitive advantage over those who comply. That's true in any industry, not just housing.
The "inefficiency" you've spotted is that a business which ignores all rules, regulations and taxes will have a huge competitive advantage over those who comply. That's true in any industry, not just housing.