I love Airbnb.
My wife and I used it a lot during ourtrip to New Zealand a few years ago. We searched out the film locations formany scenes from the Lord of the Rings movies. Airbnb allowed us to meetwith private homeowners who welcomed us. They had great local knowledge, oftentold us about the region and good places to eat.
Being welcomed by strangers into theirhomes makes a big, unknown city feel smaller. You are becoming a part of thecommunity in a meaningful way that a hotel cannot provide.
Unfortunately, New York City officialshate this.
New York City and Airbnb
The city caved into the hotel industryand has tightened the draconian laws against AirBnB.
Under New York’s Multiple DwellingLaw, homeowners can only rent their home for less than 30 days if a permanentresident is present. In other words, listing a Private or Shared Room on Airbnbis legal (if you’re paying hotel taxes and comply with zoning laws – seebelow), but an Entire Home is not. This applies for “Class A” multiple dwellings, which are buildings with three ormore families living independently. Most condo and apartment units in NYC fallunder this category. This law applies to you whether you own a place or arerenting (although your landlord might have their own restrictions regarding shortterm rentals in the second case).
The penalties are harsh: $1,000 forthe first violation, $5,000 for the second, and $7,500 for the third and subsequentviolations.
On top of that, the law bars you fromeven advertising (listing) a unit on the Airbnb website that is prohibited torent.
Even advertising? For real?
Yes. Even if you never actually rentit out. Just listing it violates the law and you could get hit with a $1,000fine.
So, how about townhouses?
Since Multiple Dwelling Law forbidsshort term rentals without homeowner present in buildings with 3 or moreapartments, it would be logical to assume that listing a unit under the EntireHome category in a two-family home or a townhouse is allowed. Especially if thehomeowner lives in the other unit. Right?
No!
Whether or not you can rent a part ofyour townhouse, even if you’re present, is not clear as the laws were writtenbefore Airbnb existed and have only been adjusted for the worst as far ashomeowners are concerned. You’ll still need to check your building’scertificate of occupancy to determine what’s permitted.
If you’re willing risk it and try todo your best to comply with the rules, I would recommend amending thecertificate of occupancy to allow for short-term rentals (i.e, switching forR-3 to R-1). Then, you’ll also have to get a zoning variance and pay the city’shotel tax.
No, they don’t make it easy.
But there are so many Airbnb listings in NYC
In fact out of 10,000s of New Yorkerslisted their homes on Airbnb over the years, the vast majority of the listingswere illegal.
The city had trouble clamping downbecause it was virtually impossible to prove without Airbnb’s records. The citypassed a law in July 2018 which would require Airbnb to provide all personalinformation of their hosts to the city. This law would have gone into effect inJanuary 2019, but fortunately, Airbnb’s legal team convinced a judge to issuean injunction to block the law.
The city tried again with a subpoenain February 2019. A judge upheld the subpoena and in May 2019, and Airbnbhanded over anonymous information for about 20,000 listings between January2018 and February 2019. The city could then request more information for thelistings that fell under the illegal category, but agreed to only do that forplaces that were listed for more than 20 days.
Subsequently, if you rented out yourhome on Airbnb in that time, but did it for less than 20 says, you willprobably be ok.
My Two Cents
It seems unfair to me if you, theproperty owner, want to rent out your home to a guest when you’re out of town,and is forbidden to do so. The home belongs to you, not the city.
Plus, homeowners can suggest theirfavorite local restaurants and shops to the guests. This can provide extrabusiness to local communities in boroughs other than Manhattan and keep goodestablishments open.
This is especially important inneighborhoods that lack hotels. How would visitors know about some of the greatlocal dining options but for a local recommendation? Visitors appreciate them.Airbnb hosts can bring tourists to neighborhoods which otherwise tourists wouldhave never ventured to in the first place.
That said, there have been majorabuses. Large landlords have bought Manhattan condo buildings for the solepurpose of running an illegal hotel. Management companies have been convertinglarge amount of units in their buildings to Airbnbs. Legitimate hotels pay alot of money in taxes plus must comply with A.D.A. requirements. It’s unfair ifcompanies can circumvent their fair share of taxes. We all lose when thathappens.
It is also way outside of the originalpurpose of Airbnb for individuals making a little extra cash to pay for thepart of their vacation by leasing their home during their time away. We hear alot about Airbnb negatively affecting low-income housing by removing apartmentsfrom the long term rental market. However, listing your primary residence onAirbnb wouldn’t affect lower income housing at all. Actually most touristswould not want to stay at an Airbnb in low income areas of NYC, and low incomepopulation of New York City couldn’t afford to rent in Manhattan andprestigious parts of Brooklyn where most Airbnb listings are at.
With that said New York City’s laws seemto be very one-sided in favor of hotels. Why doesn’tNew York City clamp down on Uber drivers as well to protect the Yellow Taxiindustry, or Seamless that is putting small establishments out of business withtheir high fees? Why just Airbnb?
Other metropolises such as Miami andLos Angeles have rules in place where people can rent out their primaryresidence for a certain maximum days per year the year, for example 90 daystotal. This is more in-line with the original intended purpose of Airbnb. Italso prevents corporate landlords from using Airbnb to run a full-time illegal hotel.
Something to ponder, NYC.