Report Shows Up to 72% of Airbnbs in NYC are Illegal; Govt to Step up Enforcement

BnB bed and breakfast sign

A report released yesterday reveals that up to 72% of Airbnb listings in New York City violate state and/or city laws which prohibit renting out an apartment for less than 30 days.1New York state Multiple Dwellings Law and New York City Administrative Code 27-2004(a)(8) both prohibit most apartment buildings from being rented out for a period of less than 30 days. See also NY Attorney General Airbnb Report, Appendix A

The report was produced by the New York Attorney General, who told NPR that many Airbnb’rs have also not been paying the required “hotel” taxes, collectively owing the city about $33 million.

Coinciding with the report’s release, New York State and City announced they are stepping up enforcement against these illegal Airbnbs, which can result in costly penalties for hosts. In one such enforcement action last year, an Airbnb host had to pay a $2,400 penalty.

Other cities around the country have similar laws banning temporary rentals, though Airbnb is lobbying hard to change these rules, seeing success in San Francisco recently. However, even if these laws do change, many Airbnb’rs still may not be on solid ground. Most apartment leases have rules against subletting without permission from the landlord. And for those that own their condos, there may be homeowners association restrictions on short-term rentals.

People able to avoid these additional restrictions may be looking forward to cities and states easing the bans on short-term rentals. But public opinion is sharply divided on whether to ban short-term rentals (also called “vacation rentals”) or to allow and regulate them. Here are some of the arguments from both sides:

Arguments in favor of Airbnbs and other short-term rentals

  • Helps people support themselves – Most Airbnb’rs are only renting out their own place, and are using the money to support themselves
  • Mostly no issues with neighbors – Most guests don’t bother neighbors or cause any trouble
  • Freedom – People should be able to do what they want with their space

Arguments against Airbnbs

  • Safety of guests – guests who stay in unfamiliar and unregulated Airbnbs are not as protected from hazards or building problems, whereas hotels have numerous such regulations and requirements
  • Safety and quality of life for neighbors – who have to deal with random, potentially noisy guests coming in for a night or two which makes them less accountable for their behavior
  • They make housing less affordableSome landlords have started using existing units for short-term listings rather than permanent housing, which reduces the availability of housing and increases prices for everyone. [Note: SF’s new law attempts to reduce this problem by limiting rentals to 90 days total per year]

Given these arguments, where do you stand on the issue of short-term rentals?



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