Resorted to AirB&B for the first time in my life this August. It was that or not go at all. As you say, benefit of cheap flights often exterminated by obscene hotel prices and frankly, as a solo traveler, having a minimum £600 outlay for a quick trip on hotel, flights, car, UK parking and extended insurance if I didn't was way more than I want to spend on a 6th jaunt of the Summer. In my case there'd have been little left in the budget to spend on food and activities if I threw it at an overpriced dump of a hotel (refurb or no refurb) !!
The place I stayed was being rented out by people living there full time subletting rooms in order to survive. If I hadn't travelled my local spend wouldn't have inputted to the island's economy. That trip it included fuel, 2 rounds of pricey watersports activities, eating out and plenty of spend in local supermarkets. Hardly all going into the hands of an AI resort or a big club promoter ! Big groups of people can get extremely cheap per capita accommodation costs in most of the Med. It's always been like that. The people who get robbed senseless in Season with a bunch of "resort-hell hotels" and "Boho chic Agroturismos" (i.e. no decent equivalents of "legitimate B&Bs") are singles, couples and small families. That's one of the gaps AirB&B is basically filling.
So I agree with
@james trying to eliminate AirB&Bs isn't going to make the island an attractive place to people who very likely spend their money out and about on the island. Letting the govt tax rental revenues through auto-reporting is a far more intelligent thing to do. If people like me can't find an affordable place to stay we will simply (sadly) wind up going somewhere we can.
Greece (other than Mykonos etc) is the same in terms of costs away from tourist traps - had a massive Apartment in rural Zante in June for £25 a night and ridiculously cheap flights. As ever the inescapable rip-off fixed costs weren't in Greece they were at home - expensive short term airport parking due no public transport at affordable flight times, expensive activity travel insurance and expensive baggage charges as I take watersports gear, being one of the main reasons I actually go !! Those 3 costs inflate any bargain deal I find these days wherever I go usually by a minimum of £200 on any short jaunt - when you can'd divide these costs by "X" people any trip winds up expensive and high local costs just add fuel to that fire
!
Side note - did you go paragliding in Oludeniz ? One of the best places to do it anywhere !!
Lucky to have seen a lot of long haul places in the past - desire to deal with time differences and unspeakably uncomfortable flights (unless you pay for premium cabins which make travelling ridiculously expensive) is pretty much gone now. Knocks out too much time going, coming back and recovering / adjusting either side too !
