Will New York’s New Airbnb Law Stop Illegal Listings?

This week, Mayor de Blasio made it official and signed a law requiring Airbnb, HomeAway, and other short-term rental companies to share data with the city on who is renting which apartments and for how long. This will fill a much-needed gap in the city’s woefully inadequate enforcement mechanism against illegal short-term rentals. But as with many laws, what the new requirement will mean for the city once it goes into effect next February depends on how it will be enforced.

Airbnb and its ilk have been skirting New York state laws for as long as the companies have existed. State law requires rentals to be for thirty days or more unless the host also lives on the property at the time of the rental. In essence, every single “entire apartment” listing on Airbnb is illegal and always has been, which is why it’s particularly humorous folks like Caitlin Connors have had no misgivings going on the record in the New Yorker sharing all the details about her almost certainly illegal Airbnb in Williamsburg.

But until now, the city had no practical way of enforcing the thirty-day requirement. Airbnb doesn’t share a listing’s exact address until booked. Murray Cox, founder of the watchdog site Inside Airbnb, notes that Airbnb’s listings are “slightly randomized,” displaying little dots near but not exactly at their actual locations. Even if the city office tasked with enforcing illegal listings, the slickly named Office of Special Enforcement (OSE), receives a specific complaint about an address, they have to then match that complaint with a listing, which can prove onerous or in some cases impossible. According to the New York Times, OSE issued 3,050 violations in 2017, a drop in the bucket compared to the 50 to 65 percent of the city’s 50,000 Airbnb listings that Cox estimates are “breaking some type of law.”

In order to properly enforce its own laws, the city needed either Airbnb’s cooperation or new legislation forcing them to turn over apartment locations. Naturally, the city opted for the latter. The new law doesn’t go as far as some other cities such as San Francisco have in creating full-on, publicly available registries for short-term rentals, but it will force Airbnb and similar companies to provide monthly reports to OSE on who is renting what and where. (Cox has no expectation the data will be made public.) Failure to comply will result in a fine of $1,500 for each listing not properly disclosed; the original bill proposed a fine of $25,000 per listing. After San Francisco’s registry went into effect, Airbnb listings in the city dropped by 50 percent, further bolstering Cox’s 50 percent illegal rental estimate for New York.

But that doesn’t mean every illegal New York Airbnb listing will suddenly disappear. All this law does is require Airbnb to disclose information; because it doesn’t create any registry or force Airbnb to boot any listings from its app, the onus is still on the city to actively enforce the laws on the books. And not all illegal Airbnb hosts are equal.

Airbnb has long argued through its “one host, one home” marketing campaign that most hosts are up to nothing untoward and just trying to make a couple of extra bucks in our fair city. But this is a narrative New York legislators have thoroughly rejected. “They like to spin that they really intend to be good guys and it’s just some people who are bad apples,” State Senator Liz Krueger of Manhattan told the City Council in June. “No, their business model is a bad apple when it comes to the affordability of housing and availability of housing in the city of New York.”

Such remarks could suggest the political will is there to eradicate all illegal listings, but so far the City Council and the mayor have generally focused on what would otherwise be affordable housing getting instead rented on Airbnb, and commercial landlords who run Airbnb-rental businesses with multiple listings. By focusing on those two cases, the hope is such enforcement would put badly needed affordable-housing stock or otherwise glorified hotel rooms back on the long-term rental market.

Until we know which strategy the city will take, it’s impossible to say what this means for Mr. and Mrs. Tourist looking to score that Crown Heights Jewel for Two. And putting a few thousand apartments back on the long-term rental market probably won’t have much impact on rental prices, especially in a year with major market shocks like the L train shutting down and Hudson Yards towers opening their doors to tenants. That is, unless I nab one of those rent-controlled apartments that used to be on Airbnb. In which case, this is the best law ever written.