
How Airbnb Earned Me $20,000 And A Restraining Order From My Landlord - timjahn
http://www.fastcompany.com/1839465/how-airbnb-earned-me-20000-and-legal-action-from-my-landlord
======
hack_edu
Again and again, people who use Airbnb to 'hack' the rental market get little
sympathy from me when the chickens come to roost. If your landlord was
interested in running a tenement home/boarding house/hotel, they wouldn't sign
you into a year-long lease. Also, and I know this has been hashed out before
on these comment threads but he's grossing $30k a year on the back of his
landlord. The landlord has every right to be upset and take action.

The author of the post seems shocked that he's in violation of anything.
Perhaps he'd like to share excerpts of his lease before he feigns such shock.

Come on, the guy lives alone in a 3+ bedroom apartment in Brooklyn. We all
know he signed that lease specifically to run a pseudo-hotel business under
the guise of an Airbnb profile. He whines that he can't afford to live in the
New York rental market without roommates; so get roommates or move somewhere
cheaper.

BTW, the author is a professional writer who (gasp!) has a brand new startup
to plug.

edit: It sounds like this guy has a sincere love for the experiences and
newfound social life he's found when acting as an ambassador for his city. His
heart is in the right place. He would make a great Couchsurfing host and
probably make even greater, long-lasting relationships.

~~~
zefi
"Come on, the guy lives alone in a 3+ bedroom apartment in Brooklyn. We all
know he signed that lease specifically to run a pseudo-hotel business under
the guise of an Airbnb profile."

Categorically not true. Chris is a good friend, and he had a long term
roommate until recently. He took on the lease because he knew they could cover
rent whether or not the third room got let out. It is an amazing apartment in
an awesome building, and his involvement in airbnb is not cynical or
presumptuous. His listing was great value and he is an excellent host. I met
him through airbnb and am incredibly grateful for it. So, try not to presume.

~~~
yequalsx
The only part of your comment that is germane to the GP is that before his
roommate left they could cover the rent without renting the third room. "Chris
being a good friend" and "His listing was great value" are irrelevant.

~~~
calibraxis
Lends credibility and helpfully lets us know bias.

------
subpixel
Crazy: I had the same landlord. I drove by his management office on Box Street
last week and saw it was turned into a hotel, and now I see the luxury lofts
listed on Airbnb.

He's not a normal landlord, he's a shark. He owns several dozen buildings,
prefers paying fines to getting permission, and once had our whole building
manned with thugs to prevent a city agency from entering the building and
confirming that he was constructing a unit on the roof without a permit.

He even connected several of his buildings' toilets and sinks directly to
storm drainage pipes, dumping raw sewage straight into the creek
(<http://bit.ly/L3f8Ey>).

~~~
roguecoder
Those sorts of actions are what regulation was supposed to prevent.

The current option, of crowd-sourcing information about possible lodging,
wasn't previously possible. While we still need regulation to prevent the
dumping of raw sewage, we could get so much more out of the space we have with
decentralized, information-rich decision making.

Plus, it's not like regulation has actually kept people like him from doing
illegal things. As long as the punishment is "a fine" breaking the law is just
another cost of doing business. If instead the government could evict him from
his properties he might possible decide its worth following the law.

------
uptown
So he's:

1\. Violated his lease.

2\. Documented exactly how much income he received during that violation.

3\. Probably thew up some red flags to ensure the IRS double-checks that he
declares that income on his tax returns.

And all of this before he finds out what the courts have to say about his
actions.

~~~
drpgq
I do wonder just how much Airbnb income isn't declared for tax purposes.

~~~
rprasad
Hopefully none, since Airbnb reports the income it pays out on Form 1099.

~~~
rprasad
Of all the comments I made today, this was the one I least expected to be
downvoted...

------
debacle
Title should read "How using AirBnB without first consulting my lease earned
me $20,000 and a restraining order from my landlord."

~~~
msrpotus
But people violate leases in little ways all the time. As long as the renters
didn't cause any additional problems, I don't see what the big deal is.

~~~
maratd
It's not up to you to determine what is a "little" thing and what's a "big"
thing. It's up to the people who signed the contract. Apparently, the landlord
thinks it's a big thing. In fact, I never met a landlord who didn't. They
always verbally specified that I am not to run a boarding house, on top of it
being in the lease. Probably because I was a college kid and well, rent to a
college kid and you get a boarding house ...

~~~
deelowe
Actually, it's because the landlord could get sued or even end up going to
jail due to stuff you did if his contract doesn't protect him from issues
resulting from the sublease. The #1 concern with being a landlord is
liability.

------
heliodor
In general, I'd have to agree this is a clear violation of his lease and
doesn't deserve sympathy, but have you guys seen the piles and piles of
legalese in these New York City leases? The lease _itself_ doesn't deserve
sympathy! For example, my lease last year from a private landlord even
stipulated I'm not allowed to go to court and must use arbitration instead. I
didn't think through it well, but next time I'll know better. It didn't become
an issue though.

~~~
fleitz
See a clause like that would be handy in a case like this, no restraining
order because the landlord can't use the court.

~~~
heliodor
New York is considered much friendlier towards renters than most other places.
It's generally agreed(?) arbitration favors the repeat customer (the business)
because why would you bite the hand that feeds you? So, I'd say arbitration is
not as good as it sounds from a first glance.

Does anyone have any insight to cast on this whole arbitration system?

------
nsxwolf
The more I think about this and how it impacts me as a landlord, I am starting
to see Airbnb as (warning: the following analogy is not perfect) the Napster
of lodging. I think they'd better step up and become the iTunes of lodging in
this regard, before more news stories like this start creating a rift between
landlords and Airbnb.

~~~
cube13
I don't think it's that much of an issue, really. The problem isn't on
Airbnb's end. It's on the renters that are giving up their rental property
without examining the contracts that they signed. Airbnb could probably be
treated the same as subletting or renting out the property, so any clauses in
the lease/association contracts that covers that should cover Airbnb.

The important thing for you, as a landlord, should be to make this clear on
the contract. Whether it's increasing the deposit or rent if the renter wants
to open up the property to Airbnb-like usage or just not allowing it period,
it should be clear in the contract.

EDIT: Airbnb actually does state this in their terms of service:

>Accordingly, you represent and warrant that any Listing you post and the
booking of, or Guest stay at, an Accommodation in a Listing you post (i) will
not breach any agreements you have entered into with any third parties and
(ii) will (a) be in compliance with all applicable laws, Tax requirements, and
rules and regulations that may apply to any Accommodation included in a
Listing you post, including, but not limited to, zoning laws and laws
governing rentals of residential and other properties and (b) not conflict
with the rights of third parties

~~~
nsxwolf
Sure, but why not actively reach out to landlords (and city governments, etc)?
Wouldn't it be better for Airbnb and everyone else if both (a) and (b) became
less likely to be impediments?

I am in a fairly rare position where I'm feeling that I would actually be
receptive to advocacy (and I'm a very stubborn person), but nobody's
advocating anything to me yet. I feel like a music publisher in the year 2000
saying "Great idea! What would you like to see in a downloadable music
service?"

~~~
cube13
What can Airbnb do? They're not a party to any agreement that a landlord has
with their tenants, and I don't think they want that.

You're a landlord. You mentioned in another thread here that you have a strict
"no subletting" clause in your contracts with your renters. What could Airbnb
do to change your mind? Nothing, I would wager. They don't offer insurance to
their client hosts, so they're definitely not going to assist with your
insurance.

~~~
nsxwolf
They could advocate for making a "no subletting" clause less restrictive, and
show some data, or at least give a rationale for why I'd want to do that.

I'm totally willing to change my mind. In fact, I'll probably take that step
on my own when I rewrite my lease. I would just like to know other people's
opinions on best practices instead of taking a shot in the dark, and Airbnb
seems uniquely positioned to come up with something.

What would be bad is for stories like this to create a backlash from landlords
against Airbnb and reduce the usefulness of the concept.

------
nostromo
If they're throwing the book at you -- throw it right back. Tell your landlord
that you're going to find the hotel closest to your apartment and show up with
printouts of their newest illegal competitor: your landlord.

It sucks to get the government involved with these disputes, but he opened the
door.

~~~
njharman
Why do you imagine landlord would be illegal competitor?

Also, petty retaliation against someone exercising their legal right to
enforce contract is morally suspect. Bordering on sociopathic.

~~~
nostromo
New York hotels are highly regulated. I'm making the assumption that the
landlord doesn't have the right permits (and isn't paying the taxes) to run a
hotel.

The point is there are no clean actors here. A landlord running an illegal
hotel and a renter that broke their lease. But thanks for calling me a
sociopath. ;)

------
webjprgm
Almost every rental agreement I've ever signed disallows sub-letting. They
also have rules about having people come to stay (as roommates, rather than as
sublessee.) no sympathy whatsoever.

Now why did the landlord decide to list rooms him/herself? That's interesting.
Could Airbnb become a way for small-business hotels to book rooms? Generally
landlords don't want short-term tenants for various reasons. I wonder if the
Airbnb idea, which plays on the social aspect of borrowing an individual's
house vs. dealing with an dispassionate corporate entity, enables leasing of
smaller properties to work. If that's the case, then a landlord seeking to run
Airbnb listings to turn a few rooms in an apartment complex into a hotel might
eventually run into trouble if this kind of arrangement becomes common on
Airbnb, since then you lose the social aspect that was making the tenants
well-behaved. With tenants who might abuse the property a small apartment
landlord probably would not want to deal with them.

Maybe an enterprising landlord could put in a clause claiming 50% (or more) of
the revenues from Airbnb if any tenant chooses to use it. In fact, maybe the
OP should offer such an arrangement to the landlord as a settlement and thus
be able to remove the restraining order and continue making some profit.

------
jack-r-abbit
It isn't exactly clear but it seems this person has violated terms of his
lease. So I'm not sure what is the issue here. Is he looking for sympathy? Or
just warning others to look at their lease agreement before starting down this
path?

~~~
planetguy
Nope, it's just a story. And a taste of things to come vis a vis the future of
airbnb and similar services.

I have no sympathy for this guy, and I have the greatest sympathy for his
landlord. I'd be annoyed if anyone started using my rental property as a hotel
due to the greater wear and tear; in fact, this is semi-common in the area
where I own rental property so I keep an eye out for the possibility when
selecting tenants.

~~~
Karunamon
>wear and tear

You charge $1200 to rent a dwelling out. It's $1200 flat. Whether 1 person @
1200 or 3 people at @ 400 each.

How do you somehow accrue more nebulous "wear and tear" from a temporary
visitor than you would from a second lessee? It's still no more than two
people at once.

~~~
blafro
This is not necessarily true. Some people rent out the living room couch as
well as the spare bedroom. Besides in the second lessee case, the landlord at
least gets to vet the second person.

~~~
Karunamon
Vetting only lessens the chance of catastrophic damage from an idiot tenant,
though. It does nothing to mitigate wear and tear. That was what my now-
masisvely-downvoted point was. The "wear and tear" argument is on pretty shaky
ground.

~~~
jack-r-abbit
The wear and tear argument was not made along with a vetting argument. Vetting
is one issue. Wear and tear is another issue. There is some ground between the
perfect tenant and the idiot who burns a place down. There are all those
people in the middle that go about their lives and little things happen. But
have you ever heard the saying "drive it like its a rental"? People will
naturally be slightly more careful with things they own or have a direct
responsibility to take care of. The more people you have using a space that
are not directly responsible for its care, the more likely those little things
will happen. We're not talking about the catastrophic damage. We're talking
about things like the extra nicks in the banister caused by someone dragging
their suitcase up the stairs. When you have a new person dragging their
suitcase up (and then back down) the stairs once a week, the chances for
additional nicks goes up. Eventually all those little things start to build
up. And it is pretty easy for a one of those rotating guests that caused a
little more damage to just move along since its not their apartment building.
People who live there and have a responsibility for the place (and
coincidentally have been vetted) are more likely to notify the landlord to get
it corrected.

------
darylteo
Huh... I thought there are usually clauses regarding "subletting" when signing
a rental lease? At least where I am anyway, "subletting" is generally frowned
on.

~~~
nsxwolf
I'm a landlord. The language in the lease I use clearly stipulates no
subletting.

There are very good reasons for this. I did a background check on my tenant,
not every possible person my tenant may randomly hand the keys over to,
unsupervised. It's really not the same thing as having guests over.

That said, I'm not opposed to including some kind of pro-Airbnb language in my
next lease. This is new territory so I don't know what it should be. A larger
security deposit? A cut of the proceeds?

~~~
fleitz
The room is free, but the breakfast costs $150 :)

~~~
khuey
Coincidentally, exchanging food for money is also highly regulated in most
developed countries.

------
hangnail_lobby
Last time I used AirBNB, I rented an apartment, and 1 hr after I arrived the
landlord showed up banging on the apartment door, furious, threatening to call
the police.

Thankfully, my social skills calmed her down, but now the apartment leasee
(lessee?) is knee deep in legal matters. Clearly the lessee broke the lease,
however I'm sure she didn't really understand so at the time.

AirBNB needs to be much clearer in the listing process of the possibility and
legal ramifications of violating one's lease. Especially since it ends up
hurting not just the people listing apartments, and apartment owners, but also
AirBNB customers who trust the listings on the service to be legitimate and
lawful.

------
yardie
Oh boy, I wonder if this guys knows what he's up against tomorrow (7th, June).
If he's lucky the landlord will just tell him not to do it again. If not
they'll be allowed to rip up the lease; now he's got 2 problems.

------
engtech
I wonder if the IRS will ever start targetingthe more popular AirBnd profiles.

I imagine most people do not declare the income, and $20k a year is
significant revenue.

~~~
ari_
Why would you imagine that? It's all there.. AirBNB issues a 1099
<http://www.airbnb.com/help/question/122>.

------
user49598
_"which in the pricey New York rental market is tantamount to eviction"_

Running a hostel in your apt for extra cash doesn't help that situation.
You're just contributing to driving rent up even further.

------
yuhong
Photo of restraining order:

[https://twitter.com/chrisdannen/status/209798659473285121/ph...](https://twitter.com/chrisdannen/status/209798659473285121/photo/1/large)

------
subpixel
Crazy: I had the same landlord. I drove by his management office on Box Street
last week and saw it was turned into a hotel, and now I see the luxury lofts
listed on Airbnb.

------
Fizzadar
On the plus side of it all; $20,000 still earned!

Not surprising landlords have caught on either, a good warning to anyone else
selling their spare rooms.

~~~
khuey
After taxes, legal costs, and the slight risk of getting evicted, $20,000 is
not that much money.

