
New York governor approves short-term apartment rental ban in NYC - kvs
http://travel.usatoday.com/destinations/dispatches/post/2010/07/new-york-governor-approves-short-term-apartment-rental-ban-in-nyc/101054/1
======
nphase
I was in NYC with my team this past Jan, trying to raise money with a few
angels in the area. The three of us decided to rent a furnished apartment to
save money. I was pleasantly surprised by the amount of space this decision
afforded. There was plenty of desk space in the unit and while there weren't
enough beds for each of us the couches made due just fine.

The landlord explained that they were having trouble leasing the apartment,
and that they were falling back on relying on this sort of rental to help
cover the cost of the space. It's a shame this won't be an option in the
future, both for poor entrepreneurs and landlords.

~~~
mattmillr
Another anecdote: I moved to the city in late March. Since then, I've been in
five sublets while I looked for a suitable permanent place to live. (Moving in
tomorrow!)

One of those sublets would have been legal under this new law.

The first was a vacation rental business, very well run by the owner of the
building. I stayed there two months, so it wouldn't fall under this rule, but
I was the exception: most of his business would.

Another was a young professional who rented out her tiny one-bedroom in the
East Village to help pay for her vacation.

A third was a friend of mine who was out of the country for a few weeks. A
win-win situation, I paid her rent and got a place to live.

The fourth was a room in a shared loft with three roommates. The guy renting
the room was a photographer who spent the two weeks in Haiti documenting the
recovery. The rent money helped fund his trip.

The fifth, the one I'm in right now, was another friend's place. She moved out
at the first of the month (due to the availability of her new apartment and
her new roommates' schedules) but was obligated to pay the rent through the
end of the month. Again, win-win. I help with her rent and have a place to
live.

Tomorrow, I move into an apartment of my own. There is a specific no-
subletting clause in the contract, and I'll honor that. But I wouldn't have
made it moving to the city if this law had been in effect four months ago.

~~~
chopsueyar
But how many neighbors did you piss off?

~~~
gruseom
Unless the GP is an asshole, almost certainly zero. There's no difference to
neighbors between this and having a guest.

------
mikecane
I don't know how many of you here are native NYers. And I stress the native,
because anyone who hasn't lived here for decades won't have a deep
understanding of how things work here. Going out to the Hamptons (or
elsewhere) for two weeks or a month and renting out your place has been going
on here for decades. This has never been something hidden from the government,
The Village Voice would be filled with Short-Term Sublet ads just for this
purpose. Now that this has risen to the level of a nascent Internet business
that can centralize, organize, and capitalize on this practice, Patterson --
faced with a crushing deficit -- slams the lid on it. Every day I wake up to
find local, state, and national government tightening the noose around our
necks more and more. All of you talking about liability -- hey, one of these
budding Net businesses involved in this could also sell short-term insurance
for such liabilities.

~~~
fmora
I'm a native. Never heard of this. We must be on different economic classes. I
come from a working class and so does everybody I grew up with.

~~~
mikecane
Did you never have to look for an apartment in The Village Voice?

~~~
fmora
Village Voice? That is so las decade.

~~~
mikecane
Yes, but that was my entire point of citing _native_ NYer. From the 1970s on,
the Voice was a go-to place for apartments for young people, which also
included tons of Short-Term Rental ads. And the Times had such ads too for the
monied set.

~~~
fmora
No, I do not get your point. I was not even born in the 1970s.

------
fmora
The first time I read about something like this I was outraged. "How dare
they, the government is blocking people's ability to do business". Then, after
some careful thought I started to agree with this ban. Basically I put myself
in the shoes of a resident next to a building being used as an illegal hotel.
The people do not have the proper permits. Obviously they are not licensed.
The fact that there is always new people coming and going in what is supposed
to be a residential area can cause problems. And I say this as a resident of
NYC. Living here I never realized that it was so expensive to visit NYC. Sorry
to be cynical but I guess it sucks to be you if you want to visit NYC and are
broke.

Notice that the person doing this illegal business is the only one benefiting
from it. The community will not get any of the taxes that it is supposed to
get which are in turn used to maintain the streets, pick the trash, pay police
officers patrolling the area, etc. etc. Essentially, the community is paying
for an illegal business.

~~~
shykes
You are missing one important point: most people affected by this ban are
individuals, renting out one room at a time, maybe two. I have a hard time
believing this generates any kind of noticeable "coming and going".

In fact, tolerating the rental of a single room per household strikes me as a
good way of separating the wheat from the chaff.

Ironically, even Cuba has such an exception:
<http://en.wikipedia.org/wiki/Casa_particular>

~~~
fmora
I also see this as a problem though. Most likely the person doing this is not
the owner of the apartment. I wonder how the original landlords feel about
this. Maybe they just don't care, who knows. Seems wrong to be using their
apartment for this when they never agreed to it.

~~~
qq66
I would consider the landlord's involvement in this decision to be an
"abstraction violation." When I lease the apartment, I make a guarantee to
return the apartment to you in the same condition that I received it (with a
fine to be paid if I do not). It should be my choice whether to assume the
risks of a subletter, temporary or long-term.

~~~
lsc
more to the point, nearly all residential leases explicitly prohibit
subletting already, so regardless of city law, you are violating your lease by
renting out an apartment on the short term without the landlord's permission.

------
jim_h
That's one way to make NYC even less affordable and friendly to tourists on a
budget.

I've met some very interesting and friendly people in 'short-term apartments'.
Mostly foreign students/travelers on vacation, people moving to NYC for work
and using it as temporary housing until they find a real place, or just
regular Americans visiting another city on a budget.

They make it seem like these places are unclean or unsafe, but they're not any
more dirty or dangerous than any other apartment.

~~~
rdtsc
> That's one way to make NYC even less affordable and friendly to tourists on
> a budget.

But that is a valid concern I suppose -- does NYC benefit from tourists on a
budget? If it doesn't then it might make sense to keep them out so tourists
"not on a budget" can have more space, visit more often, and consequently
spend more money.

I can see how tourists on a budget would not be welcome in many cities. Some
places rely on selling overpriced services and items to tourists and rely on
tourists coming in and just throwing money around. So making legislation to
accommodate certain visitors, but discourage others, kind of makes sense.

~~~
jim_h
You could spend $100+ on a hotel for the night, or spend around $30 or less on
a temp place. The money you save CAN be used for touristy things. That's $70 a
day that can thrown somewhere else besides for shelter. They could be out
partying, trying out food places, buying things, etc. This is just the savings
from not staying at a hotel..

A tourist who stays at a hotel ($100/night) might only have budgeted $50/day
to spend outside of hotel costs.

A cheap tourist could budget $100/day, stay at a temp place and still get more
out of NYC than someone who budgeted $150/day and stayed at a hotel.

~~~
mrtron
I would agree - the money spent on hotels probably doesn't stay as local as
money spent on food and entertainment.

Really an unrelated issue though.

------
DanielBMarkham
Interesting startup lesson here.

NYC -- famous for high cost-of-living. So folks start micro-leasing as a way
to recoup costs. Several startups are created as a way to coordinate these
micro-leases.

Response? Government steps in and shuts it down.

The reason social problems, like housing shortages and the political
responses, are important to talk about on HN is that big companies solve big
problems, and _nothing happens in a vacuum_. Sometimes your biggest competitor
can be the political status quo.

I find the governor's remarks true, yet unconvincing. Kind of like a lot of
politician-speak. Politicians (of all stripes) learn from the legal, public
relations, and polling professions how to take any position on any side of an
argument and make it sound somewhat plausible and reasonable for Joe Six Pack
giving the entire matter 5 minutes thought.

In the absence of public uproar, this was done for commercial reasons. Dig
deep enough and you'll find somebody with a checkbook.

~~~
jawngee
No, what I think you will find are people who believe that operating a
commercial enterprise, which is what micro-leasing is, needing to be subject
to regulation, licensing, insurance and liability - which they are currently
aren't. I also believe you'll find people concerned about the possibility of
renters being taken advantage of with no legal recourse.

It's pretty simple.

~~~
DanielBMarkham
I was going to use a bit of napkin logic to explore what you've said, but on
further inspection your logic is circular, so needs no further exploration.

If these things should be regulated because they are of a type of thing to be
regulated? Then we haven't really advanced the discussion much, have we?

Maybe you want to have a "big government" argument, but forget all of that.
I'll assume you are correct. This is a type of thing that of necessity needs
regulation. There are other enterprises just like this one who were not
regulated. So why now? Why this? Certainly you don't feel like the actions
were just random -- somebody rolls a dice and picks these guys out. I mean, as
good and as wonderful and as healthy as all these restrictions are, they have
to come from _somewhere_ , right?

Pick your favorite thing you wanted the government to do or not do over the
last 20 years that never happened. Why did the government do _some_ things and
not others? Is there some secret logic or calculus that is used to determine
which things to fix and which not to fix? Or is it just votes?

I mean, you understand the reason for political parties, right? The use of
force to protect interests. The speeches are all about bunnies and apple pie
and protecting orphans, but bunnies and apple pies and orphans don't vote or
make campaign contributions, do they?

Sorry about the cynicism, but there's a very interesting economic lesson going
on here that has to do with startups, so I thought it worthwhile to point out.

Not trying to get in an argument, although I have no doubt that I've gotten
into one. So I'm done here.

~~~
jawngee
What other enterprises similar to AirBnB that aren't regulated?

Restaurants? Regulated. Car rental? Regulated. Retail? Regulated. Banking?
Regulated. Hotels? Regulated. Bed and Breakfasts? Regulated in the state of
New York. Bars? Regulated. Movie Theaters? Regulated.

Name me one thing that isn't regulated, subject to zoning, subject to
inspection, subject to fire and/or safety codes?

It isn't a matter of big government or whatever weird diatribe trip you are
on, it's a question of consumer protection, it's a question of taxation, it's
a question of safety and fire codes, and it's a question of the rights of
other tenets living in the building to not be subject to a random rotation of
people in their homes.

[http://politifi.com/news/Students-young-professionals-
duped-...](http://politifi.com/news/Students-young-professionals-duped-into-
paying-for-nonexistent-space-in-new-loft-948842.html)

[http://ny.curbed.com/archives/2010/03/26/party_boy_bounced_f...](http://ny.curbed.com/archives/2010/03/26/party_boy_bounced_from_illegal_williamsburg_hotel.php)

~~~
borism
I agree with most of what you said, but why is random rotation of people is
bad for other tenants.

Also, isn't this a part of what New York is? I'd love to live in this city for
a month or two or what is possible on a visa, but this will make such dream
impossible.

~~~
earl
For the fifth time on HN: Manhattan is the most dense housing in the US. The
vast majority of Americans and most visitors to the states don't live in
anything comparable. Further, unless you live in a prewar, lots of housing in
Manhattan is pretty inexpensively built -- especially anything dating from the
60s and 70s, of which there is a lot. Little concern was paid to sound
insulation, and often the walls between neighboring apartments are no thicker
than the walls between rooms. Thus, people are much more circumspect about the
noise they make and their behavior in order to live and get along in such
housing.

Further, long term tenants know they will have to see and get along with each
other so there are further incentives to not being noisy or obnoxious.

On the other hand, short term tenants often want to party and have no such
incentives not to be shitty neighbors. This isn't merely theory but also my
experience living next to a short term place in SF. Thus, many denizens of NYC
and SF do not want such neighbors.

------
whakojacko
Lots of people seem to be thinking that all the big hotel chains are being
evil by lobbing this kind of anti-competitive legislature out to kill airbnb
and the like. And while that maybe be true, you also have to realize that
governments would much rather prefer people stay in real hotels regardless of
what the hotel industry thinks. Local governments get a lot of money off of
occupancy taxes, as well as tax off of the employment of those in the service
industries. How many airbnb hosts in NYC are paying occupancy taxes? What
about reporting income? My guess: not too many. And this is completely
ignoring zoning regulations that these self-serve hotels trample upon.

Im going to guess that these laws will become more prevalent soon unless
airbnb & co start become proactive about keeping track of all the relevant
taxation.

~~~
jim_h
What about home owners convert their N family house into N+1 (or N+2) family
houses and rent out the floor(s)? In fact I'm pretty sure it's very common to
do. I've even seen houses with 2 floors, but 5 mailboxes. I'm sure the
government would also get taxes from the increased property taxes and reported
income of people doing that.

The hotel chains aren't evil, but they have their interests and I don't doubt
they're giving the extra push for this to go through.

------
jawngee
I live in NYC, and while I think AirBnB is decent idea, I sure as hell
wouldn't want to live in a building where the landlord - or another tenet -
were renting out their spot like a hotel or hostel.

At the point you are doing that with any sort of regularity you should be
subject to licensing, insurance, etc.

~~~
richcollins
If you don't want to live someplace that allows short term rentals, make sure
it's in the contract that you sign when you buy the place. No regulation
required.

~~~
jonknee
You already did, unlicensed hotels aren't legal to run out of your home. This
law just makes that easier to enforce.

~~~
richcollins
That isn't a contract its a law. A law that I'm arguing against in favor of
contracts.

------
gruseom
Yet another illustration of how those with political power are not subject to
the discipline of the market.

~~~
zupatol
The market is created by laws, laws are created by politicians, politicians
are elected. That's how a democracy should work, anyway.

City planning is something complicated where I'm not so sure a pure market-
driven solution would be optimal. Markets only allocate resources well when
there are no externalities. They do nothing towards a fair distribution of
wealth. A good example of poor city planning caused by the market is the
housing bubble.

I don't know the situation in New York, but if hotels were in fact crowding
out the poor from the city, it would be perfectly legitimate to ask if this is
desirable.

~~~
w00pla
> They do nothing towards a fair distribution of wealth.

What is the "fair distribution of wealth"? I personally believe that you are
only entitled to the wealth you yourself created (or which someone voluntary
gave you).

Isn't that a fair distribution of wealth? Or what other metrics do you use?

~~~
ugh
If only the world were as simple as that. Location and family play a huge role
in whether you can create (as much) wealth.

~~~
w00pla
Maybe. But here is the thing – do you think it is fair for someone else to
subsidize your children (at the cost to themselves)?

It is usually the duty of parents to raise their children (and pay for their
education). The left however feels that it “takes the village to raise the
child” (nice way of saying that someone else should pay for education, etc…).
This means that dysfunctional people and families can externalise the
consequences of their actions.

If we think of it in a crude way: wouldn’t the most fit evolutionary strategy
in such a system be to just get as much children as you want? Since someone
else will bust their but to pay for the raising and education of your child.

This is unfortunately what happens in many countries, and it is quite sad. In
my country there are 13.4 million people on government grants and there are 12
million people working. Of those that work, only about 3 million pay tax (75%
which is paid by 750,000). Of the 13.4 million receiving “social grants”,
about 9 million are child grants (government pays them for each child under
16, thereby encouraging people to get children. Many people receive the child
grant from their children before they stop getting their own grant).

The point of this is that each tax payer is paying to raise 3 children that
are not theirs. Is that fair? Should someone really be allowed to get children
if they cannot afford them?

This is also one of the reasons I believe that democracy does not work in most
countries – especially countries with a high population or which is not
homogeneous.

The excuse of “family location” is BS. Many people have put off or postponed
having children until they can afford them, and at least kept the number of
children to a minimum. Many people also at least put in the effort to raise
the kids that they have properly.

~~~
Psyonic
"Should someone really be allowed to get children if they cannot afford them?"

Probably not, but there's the rub. How do we prevent this? Perhaps if we
refuse to bail them out... but are you willing to watch a child starve to
death? Will you be the one to pull the plug?

~~~
w00pla
The first thing would be to refuse child grants so to prevent adults from
getting children, in order to get welfare. Awarding people for getting
children is wrong and stupid.

The second thing is to force mothers to reveal the father of their children.
Many do not inform the state who the father is, therefore forcing the taxpayer
to pay for raising the child instead of the father.

And probably the best option would be to implement policies similar to China’s
one child policy. A good example would be forced sterilization after 3
children if the person receives any form government welfare (or already have
kids and is imprisoned).

But in any case, well before this point, the state can spent money on
voluntary sterilisation campaigns (i.e. paying the poor and drug addicts to be
sterilised).

~~~
ugh
Why is it suddenly fair for the government to make such extreme intrusions
(forced to reveal information, sterilization) when before it wasn’t (taking
aways money).

~~~
w00pla
Because the nature of economy changed. In the old times, any able bodied
person could do manual labour. Now manual labour isn't needed that much
(industrialisation, etc...).

Another reason is longer life expectancy and subsidized health care. In the
old days, a person inclined to irresponsible reproduction will not live that
much longer than a person without. Now there are many countries with an
average fertility rate well over 6.

Another reason is that it reproductive responsibility has been shown to work.
Compare China to every 3rd world country (e.g. 50 African countries and
India). Their one child policy not only stopped untold misery, but created the
bedrock for future prosperity.

------
wrs
Paris has a similar law, except the limit is a year, not 30 days. Now they say
they're going to enforce it. (We'll see...it's France.)
[http://www.nytimes.com/2010/07/07/business/global/07rent.htm...](http://www.nytimes.com/2010/07/07/business/global/07rent.html)

------
diziet
A startup like AirBnB worked to increase ease of entry into the market.
Outlawing it is simply protectionism of an industry that simply isn't staying
as competitive as many smaller entities organized by a technology. Let's pass
a law limiting holding time of tbonds to at least 30 days, shall we?

~~~
earl
Or people who live in the most dense housing in the US deciding they don't
want randoms, particularly people from out of the city who often aren't aware
of just how loud they are, frequently moving in and out as neighbors. As a
former and future resident of NYC and current resident of SF, I'd hate to live
next to such a place. I did until recently in SF and it sucked.

~~~
jgoewert
> randoms, particularly people from out of the city who often aren't aware of
> just how loud they are

Doesn't stop anyone from in-town either. I lived for a year in a place that
the upstairs neighbor stomped everywhere as he was morbidly obese and had to
use the toilet frequently. The neighbor on the right played rap and hip-hop at
max blast from midnight til 6 am, often leaving it on all day when he left to
work. And the couple on the other side had rough sex nightly. And even more
interesting is that this place was in a decent part of town, not some
slumhole.

> frequently moving in and out as neighbors You mean, like a hotel? There is
> one two blocks away from my house. Never been a problem. Or, are you more
> refering to something like transients? My subdivision has a lot of them,
> Bosnian families moving in extended family, finally getting their gov't
> grant, and moving out. Hasn't been a problem either... well, except for this
> one guy, but that was resolved and he wasn't a transient, he owned the home.
> Is your stance from a fear of strangers and foreigners?

I don't see your arguemenst fit into the equation at all.

~~~
earl
Neighbors two blocks away are simply nothing like neighbors 2 inches of
pressboard and a couple two-by-fours away.

As for permanent neighbors, call the board or your landlord. Either should
happily fix that problem for you.

------
uuilly
Economics: The study of the distribution of scarce resources with alternative
uses.

It would be great if more people knew that.

~~~
ataggart
"The curious task of economics is to demonstrate to men how little they really
know about what they imagine they can design."

~~~
uuilly
Love it. I've been reading a bunch of Thomas Sowell recently. That seems like
it could be straight out of "A Conflict of Visions."

~~~
patrickgzill
Hayek.

~~~
uuilly
Sowell quotes him heavily.

------
vox
I think this law cuts into our freedom as house/apartment owners. I don't
think the government should have the right to dictate our lives at such a low-
level.

~~~
_delirium
I can't answer the philosophical/ethical question, but on the legal side, if
this is considered a kind of "zoning" (prohibiting commercial use of
residentially-zoned property), it's long established that that's a permitted
kind of regulation: <http://en.wikipedia.org/wiki/Euclid_v._Ambler>

~~~
chopsueyar
You would also need a permit for your home-based startup, since you are using
a portion of your residential space for business purposes.

------
yason
They could ban renting apartments but anyone should be able to rent a spare
room, provided you live there yourself. That would rule out the wannabe hotel
keepers and make it easier for people to rent their own space, which I believe
is the original point of couch crashing.

------
jrockway
Wow, a law! This will stop the "problem" just like the drug laws solved the
drug problem. Nobody wants drugs anymore, and even if they did, it would be
impossible to obtain them. Same for short-term rentals, thanks to this!

~~~
fmora
It will make Airbnb business more difficult in NYC. Sure, it hasn't stopped
the drug Mafias but it sure makes their job harder and brings the price of
drugs up (they love this though). This will probably bring the price of short
term rentals up. Enough perhaps to satisfy the hotels. Which maybe is all they
want.

------
thinker
Wow. This is a direct swipe at airbnb.com no doubt (a YC startup). New York
must be the largest market for short-term rentals.

------
ryanb
I wonder if apartments on the Jersey side of the Hudson (Hoboken, Jersey City,
Weehawken) are now going to jump in price on airbnb.

------
helveticaman
Does Airbnb have a lobbying budget?

~~~
plusbryan
They definitely did a bit of grassroots lobbying with petitions
(<http://savenysublets.tumblr.com/>) and I heard the founders spent some time
in NYC. But nothing compared to what I bet the Hilton's of the world put into
it.

------
buro9
Is the wording of the legislation specifically against "vacation" short-lets?
As in... does it block business related short-lets?

In which case, what's to stop AirBNB from adding a "trip purpose" selector to
their site which would default to "business" when a property in NYC is
selected.

And if it does stop business short-lets, why isn't that industry up in arms
about this?

------
petercooper
Meanwhile, there are people of privilege or wealth who are renting places for
$500 a month next to Central Park. What a world.

~~~
fmora
Source?

~~~
petercooper
It's a known problem, but..

[http://www.thefreelibrary.com/Theres+nothing+liberal+about+r...](http://www.thefreelibrary.com/Theres+nothing+liberal+about+rent+control-a04262000)

<http://www.nber.org/~luttmer/rentcontrol.pdf>

Search [http://www.streetsblog.org/2010/02/10/nycs-rent-
stabilized-p...](http://www.streetsblog.org/2010/02/10/nycs-rent-stabilized-
parking-a-hidden-subsidy-to-drive/) for "rent control"

------
samratjp
Wait, does this mean this stops businesses like Airbnb from operating in NYC?
Regardless, the whole thing is b.s.

------
rdl
I wonder how much this lowers the price of 30 day rentals in April 2011 vs. 3
x 10 day rentals today.

I was going to AirBnB a few separate places in different parts of NYC for a
month or so, but now it looks like I should do just one. If all of the daily-
rentals have to convert to 30+ day rentals, it should increase supply by a lot
more than the number of people willing to switch from short stays to longer
stays.

------
ryanwanger
All the NYC BnB rentals will start listing their terns as: "You must intend to
stay 31 days or longer."

------
makmanalp
Related (might be vetoed):
[http://travel.usatoday.com/destinations/dispatches/post/2010...](http://travel.usatoday.com/destinations/dispatches/post/2010/07/new-
york-short-term-vacation-apartment-rentals-tripadvisor-ban/100935/1)

~~~
rhymeswithcycle
Nope, the governor signed the bill and said he wouldn't veto it.

------
swah
How well does this apply in practice? "You're going to receive some friends in
your house while you're away."

------
chopsueyar
New startup idea:

Combine AirBnB w/ Zipcar, but for RVs.

------
plusbryan
I wonder how the governor will feel now when NYC foreclosures skyrocket.

------
toxicflavor
Whether they can actually enforce it is the question. Many leases already have
provisions against subletting and landlords have had a hard time doing
anything about violators.

