As you surely know by now if you rent out your apartment through Airbnb—whether you’re a working stiff making a few extra bucks each month to cover your rent or an enterprising bartender making $45,000 a year pimping out your friends’ pads—the jig is just about up. A new state law threatens to push many users out of the short-term rental business, so Bedford + Bowery asked several Airbnb hosts from the home sharing hub of Williamsburg how they plan to deal with the new regulation.
New York’s new law subjects hosts to harsh fines for advertising short-term rentals that violate the state’s multiple dwelling law, which bans renting entire apartments for less than 30 days in most buildings. Renting out private rooms and shared spaces is legal under current law. (Presumably the “camper” taxi cab available for rent on the streets of Long Island City falls outside the bounds of this new regulation… but we’re still not entirely convinced it should be legal.)
A 2014 report from New York Attorney General Eric Schneiderman found that 72 percent of the city’s Airbnb rentals were illegal. Airbnb recently released data showing that about 53 percent of its New York City listings were for entire homes, and would thus potentially violate the law if rented for a period of less than 30 days.
These types of short-term rentals have been illegal in New York since 2010, but the new law exposes would-be hosts to the threat of heavy penalties for simply listing their apartments for rent on home sharing sites like Airbnb and HomeAway. Under the new law, first-time violators face fines of up to $1,000, with a maximum penalty of $7,500 for repeat offenders.
After Gov. Andrew Cuomo signed the bill last week, Airbnb filed a lawsuit in federal court in an attempt to block the law. The new law took effect immediately, but New York has said that it won’t be enforced until Airbnb’s lawsuit is resolved.
Both critics and supporters of the law have attempted to frame their preferred policy as beneficial to working-class New Yorkers. Proponents of the bill claim that that Airbnb and similar services contribute to rising rents and a decline in the availability of affordable housing due to individual hosts holding and renting multiple apartments that would otherwise be available on the housing market.
The law’s critics counter that most Airbnb hosts rent out only their primary residence and thus do not affect the overall housing supply. (According to Airbnb, 95 percent of New York users who share an entire home have only one such listing.) Airbnb says it has taken steps to prevent individual hosts from listing multiple homes for rent, and that many hosts use the service as a crucial source of supplemental income that helps to cover rising rents.
Henry, 37, said the money he makes renting out his one-bedroom Williamsburg apartment on Airbnb while he travels for work helps to cover his rent. (Like the other Airbnb hosts quoted below, Henry’s last name has been omitted due to concerns about enforcement of the new law.) He plans to de-list his apartment to avoid paying fines under the new law, but worries about how he’ll afford his expenses without the extra income.
Henry blames the “greedy hotel industry” for holding back what he believes is the future. “I want the city to also shut down Uber and the rest of the sharing economy and let’s see how the community copes,” he said.
The supposed influence of the hotel lobby in the law’s passage is a common point of complaint from the pro-Airbnb camp. The hotel industry stands in open opposition to Airbnb, which it views as an unwelcome competitor. “In typical fashion, Albany back-room dealing rewarded a special interest — the price-gouging hotel industry — and ignored the voices of tens of thousands of New Yorkers,” Josh Meltzer, Airbnb’s Head of New York Public Policy said in a statement after the law was passed.
But Pal, 40, another Williamsburg host, said he’s found that Airbnb caters to a different market of travelers than hotels. “I have an apartment that fits eight people,” he said. “You’re not gonna find any hotel room that fits eight people.”
Anti-Airbnb affordable housing advocates would probably say that Pal is part of the problem: the apartment he lists on Airbnb is not his primary residence. He moved to a larger space a few years ago, but held onto his old apartment to rent on Airbnb and give visiting friends and family a place to stay. But he views this as having little bearing on the city’s affordable housing supply. “It’s in a slumlord building and it’s $3,000 a month,” he said. “There’s no low-income person that’s going to benefit from it going on the market.”
Pal said he plans to take the listing down and that he’ll likely be forced to stop renting the apartment due to the new law.
A determining factor for many hosts in choosing whether to remove their listings will be how the new law is enforced. As before, the city will respond to complaints about illegal short term rentals, but the city is now empowered to fine violators based simply upon advertised listings. For a sense of scale, a search of 311 service requests using NYC OpenData showed that the city has received over 800 calls regarding illegal hotel rooms in residential buildings so far this year. In a recent press release from the Share Better Coalition, an anti-Airbnb group, City Council Member Helen Rosenthal likened the old system to “trying to empty an ocean with a bucket.”
The Mayor’s Office of Special Enforcement, which received a budget bump of $10 million last year to help handle the illegal hotel problem, will still be responsible for enforcing short-term rental violations within the city. Melissa Grace, the mayor’s deputy press secretary issued the following statement: “We are taking the steps necessary to enforce the law. We take on operators of illegal hotels who put people in unsafe conditions and displace affordable homes. We will continue to apply our laws, including this one to hold bad actors accountable.”
Though the law does not distinguish between small-time hosts renting out their primary residence and large-scale offenders listing several rentals, Assemblymember Linda Rosenthal, who sponsored the bill, said she expects that the Office of Special Enforcement will focus its attention on commercial operators listing multiple apartments. “I think they would prioritize operators who are warehousing dozens of units, rather than than a lady tenant who does it once in a while,” she said. “I mean, she’s still breaking the law. The question is if it’s worth going after her versus going after someone who’s in control of dozens of units.”
“This was not an attempt to change the 2010 law, this was an attempt to show we’re serious,” she said. “So many commercial operators are violating the law with impunity, so adding this provision will hopefully put a stop to a lot of that activity.”
Eric, a 34-year-old Williamsburg host, told us, “The fact that the law does not delineate between someone who lives in their permanent residence and rents out occasionally while away or on vacation versus someone with multiple properties is asinine.”
Eric said he’ll take a wait-and-see approach to taking down the listing advertising his loft. If fines are actually enforced under the new law, he says, it won’t make financial sense to continue hosting. “What they are doing is just pushing the market back to something more informal — where there is less transparency, less safety,” Eric said. “This won’t stop short-term renting of apartments, it will just take place out of sight.”
Though Eric is angry with the state and hotel lobby, he also blames Airbnb for failing to satisfy lawmakers with self-regulation before the push for legislation gained momentum, a choice he attributes to short-sighted greed. “Both the State of New York and Airbnb are shitty actors who are solely looking out for either their own interests, or those of special interests, while both claiming to be looking out for the average guy as a facade to hide behind,” he said. “Any way you read this situation, the biggest loser is the average homeowner or renter who lost supplemental income.”