

NY hotels trying to outlaw short-term home sublets (i.e. AirBnB) - tjsnyder
http://techdirt.com/articles/20100628/0037599977.shtml

======
callmeed
I think is only going to happen more and more across the country. I understand
AirBnB is _disruptive_ to some degree, but you have to consider:

\- Cities that rely on tourism generate revenue from hotel "bed taxes" which
are often higher or in addition to sales tax

\- People who are making money on AirBnB by renting out rooms probably aren't
paying income tax on it (call it a hunch)

\- All the sublease/short-term laws that exist already. For example, in Shell
Beach, CA (near where I'm at) you cannot rent a house/room for less than 1
month. People on VRBO are already sketchy about this when you call.

\- I still see significant liability issues for _both sides_. Seriously, what
happens if you rent out a room illegally and the guy/gal slips and falls in
your shower? What if your dog bites them?

I want AirBnB to do well, but could enough local/state government regulations
threaten their growth/existence?

~~~
picasso81
Airbnb didn't invent vacation rentals or sublets. VRBO/Homeaway and
Craigslist, the dominant players in the space, have been doing this for years.
You bring up good bullet points but if they were real issues, Homeaway
probably wouldn't be the $1B company it is today. This is nothing more than
hotel lobby groups pushing a bill through their pockets. Occupancy rates are
recovering from an all time low (as in lowest in 40 years) and they see
cutting off vacation rentals as a strategy for improvement. Mayor Bloomberg
even _thanks_ the Hotel lobby groups in his press release
<http://bit.ly/9iNt3Q>. Separately, there seems to be a misconception that
Airbnb is hands off with taxes, when in fact hosts who meet the appropriate
income standards are issued a 1099 form.

Over time, a city like NY will most likely see a drop in tourism if (a) if the
vacation rental industry is removed from the playing field, and (b) hotel
prices stay the same (or go back up to 2007 standards). There is a large class
of travelers who cannot afford NYC on $300/night rates, and will likely still
travel, but choose to spend their money elsewhere.

~~~
callmeed
First, I wasn't necessarily taking a side–more posing the question "could
enough govt pressue hurt AirBnB's business?"

Second, I think the comparison to VRBO/Homeaway only goes so far. Those 2
sites cater primarily to vacation/2nd home owners (i.e. renting out an entire
house/condo for week). You don't see many "Rent out my extra bedroom for
$60/night" listings on there. Unless I'm mistaken, that's where AirBnB
differentiates itself and, IMO, makes it more risky.

------
m0nastic
Last week I rented a room for a week through airbnb.com at a place that is
basically running a commercial hotel operation (as an aside, the place was
great) while apartment hunting in NYC.

While there, my girlfriend dug up a bunch of stories about the neighbors
complaining about condo unit owners leasing out units to this place. I can
understand both sides of the argument; if I'd just bought a condo in a
building I wouldn't be happy about a large majority of the other units being
rented out every night to tourists.

I got the distinct impression that there had been a problem with crime and
people being disruptive in the buildings recently, although the whole time we
were there it was quiet.

Apparently the owner of this hotel has approached a bunch of building owners
with vacant condos and offered to lease them. The building owners are very
happy (as apparently they are getting more then they would to rent them as
apartments).

I will say that I stayed in a giant two bedroom loft in Williamsburg for about
half the cost of a "regular hotel"; so it's definitely appealing.

After checking out, I actually got an email from the hotel with the number for
New York Speaker's office asking us to call them about bill Bill A10008.

~~~
fgf
Having a steady stream of noisy neighbours is no different from having one.
The solution is the same; hold whoever rents the apartment accountable. (This
would be easier if throwing people out was.)

~~~
varjag
Uh no.

You can have a noisy neighbor, go through a lengthy feud involving building
administration and law enforcement, and finally make them reasonably quiet at
night. Now, try doing that with the tourists who are in just for a couple of
days and don't give a damn.

~~~
fgf
Uh yes.

You can have a neighbour who trough airbnb rents out to noisy tourists, go
through a lengthy feud involving building administration and law enforcement,
and finally make sure _he_ makes sure it's reasonably quiet at night. If any
changes in laws would be necessary to make these processes identical they
should be smaller and less disruptive than an outright ban on activities like
those of airbnbs lenders.

------
wdewind
I'm mostly interested that this doesn't touch on the more basic issue:

AirBNB is illegal not only due to short term hotel law, but also due to
sublease law in NYC. You CANNOT sublet an apartment for more than it is worth
in New York. I've met and heard of more than a few people who rent apartments
and use AirBNB as a primary source of (as OP points out, untaxed) income. I'm
surprised NYC landlords aren't more up in arms about this.

I don't agree with making it illegal outright, but I actually am kind of in
favor of regulating and taxing this better, for the issues the OP talks about
as well as the sublease issues.

Edit: After thinking about this a little more I realize the OP goes 90% of the
way but doesn't quite cross the finish line with the argument. AirBNB IS the
regulatory institution, and is doing a better job than the govt. My sublease
point still stands.

~~~
starkfist
NYC is scam central when it comes to subleasing and renting out rooms. There
are tons of people in rent controlled apartments who have no moral qualms
about making a buck off of their sublettor or roommate. Another reason AirBNB
is interesting because they are making it obvious who these people are and
where they live...

~~~
wdewind
Absolutely. The NYC real estate market is an absolute nightmare in so many
ways. Right now it seems most akin to the DeBeers control over the diamond
market (ie: an industry based on false scarcity).

~~~
sstrudeau
No, I think apartments really are scarce. It's not like landlords are sitting
on vast quantities of inventory to drive up rents.

That said, rent regulation (mostly rent stabilization vs. rent control, these
days) does skew the market, creating a small number of lottery winners lucky
to have below-market rents and driving up rents for everyone else competing
for the unregulated inventory, regardless of their economic status.

~~~
starkfist
Sorta true, sorta false. There are not vast quantities of inventory, but there
certainly isn't a shortage. There are loads of "luxury rentals" in battery
park city, downtown brooklyn and williamsburg that the developers are having a
hard time getting people into, even with all sorts of incentives.

The prices are pulled out of thin air. The new developments have to charge
usurious rents to recoup their costs, but a lot of individual owners bought
their building outright in the 80s for peanuts and just charge whatever they
think they can get. Any old building in the LES or east village is basically a
mint for the owner.

There may be a shortage of affordable, nice apartments in places where people
want to live. Good luck finding a nice place for < $2000 in the LES. However,
there is no shortage of expensive, crappy apartments in "uncool" parts of the
city. In a weird twist of reality it's now easier to find a good deal in the
UES than it is in the LES...

~~~
yummyfajitas
_Good luck finding a nice place for < $2000 in the LES._

Fun fact: if an apartment is rented for less than $2000, it becomes subject to
rent stabilization.

Many landlords would rather have an apartment go vacant than become subject to
rent stabilization. Better to lose a year's worth of rent now than 20 years
worth of rent in the future, not to mention loss of flexibility (i.e., you
can't sell the apt without permission of the tenant).

~~~
wan23
This isn't actually true. If an apartment rents for more than $2000 it is no
longer subject to rent stabilization, and there are various tricks that
landlords use to make sure it doesn't fall back under such as issuing rebates
or free months and then quoting an effective monthly rate.

------
p3ll0n
Interesting comment on related article by NYT that offers some insight into
what type of behavior this bill may be aimed at curbing ...

[http://cityroom.blogs.nytimes.com/2010/06/29/bill-could-
make...](http://cityroom.blogs.nytimes.com/2010/06/29/bill-could-make-
subletting-a-tad-illegal/#comment-700185)

~~~
djb_hackernews
I've seriously underestimated the popularity of airbnb if people are purpose
building structures (undercover no less) for the sole purpose of marketing
them as a place to crash on airbnb.

Also amazed that neighborhood groups have "Illegal Hotels Committee"s

~~~
earl
Well, try living with me. I live in Ashbury Heights in SF. Our next door
neighbor runs a possibly illegal short stay hotel. It sucks ass -- this is a
quiet residential neighborhood and he rents to either redneck trash that think
it's appropriate to open their car windows, blast country music as loud as
their stereos will go, and drink cheap beer on the sidewalk at 2 in the
morning or to eurotrash who at least have their loud parties in the house, but
tend to party much later. I've had to repeatedly call the police, and finally
settled the problem, for the most part, by setting my alarm for 4 AM and
ringing the doorbell of the owners / using an air horn to wake the owners up.
I made him understand that when I don't sleep, his family doesn't sleep, and
he finally cracked down on it.

I still have his drunk assholes peeing on our garden once a month.

~~~
blhack
> _I still have his drunk assholes peeing on our garden once a month._

Get a dog.

~~~
pavel_lishin
Running electrified fencing is probably cheaper in the long run.

Although I guess it'll only solve the problem once per guest.

------
sdurkin
When they start trying to outlaw you, you know you've made a big dent in their
bottom line.

~~~
moolave
And this is where the startup needs to partner up with other powerful
conglomerates. Like YouTube going to Google after being relentlessly sued by
Viacom.

------
pavel_lishin
Someone threatening your business model? They're not innovators, they're
criminals!

~~~
dotcoma
Home cooking is killing the restaurant industry.

~~~
fgf
If they could, they would ... Stringent health/safety standards actually do
this already. There isn't anyone running small cafes from their kitchens in
Manhattan, wich is a shame.

~~~
sstrudeau
Actually, there are quite a few "underground supper clubs" in NYC. Typically,
they're held in private apartments with a prix fixe menu. One article from
March on this trend:

[http://www.theatlantic.com/food/archive/2010/03/going-
rogue-...](http://www.theatlantic.com/food/archive/2010/03/going-rogue-
americas-underground-chefs/38090/)

~~~
pavel_lishin
I cannot fucking wait to live in a city where not only does the concept of
"underground supper club" exist, but where newspapers cover them.

------
dman
Yes getting legislation on your side and suing people will completely undo
fundamental shifts that are happening in the real world. NOT. Hotel Chains
should be the ones at the front coming up with services like airbnb or
integrating them. The hotel brand can offer as a front to loosely federated
room providers and the hotel steps in by doing quality control and enforcing
standards. In fact people in the hotel industry should be overjoyed that this
model removes two of the big costs of running hotels - hotel staff and realty
costs for the property. All the hotels have to do is to be umbrella brands and
get "franchise" service providers.

~~~
SoftwareMaven
The hotel industry has not changed significantly in a thousand years (maybe
more). There are few industries I can think of that are more historically
defined than the inn with the inn keeper. Aside from the implications of the
traditions, it is also a business model that has worked remarkably well for a
long time. I doubt they are going to be keen to jump quickly on a major
disruption.

~~~
dantheman
Actually, I think Conrad Hilton revolutionized the hotel industry - the
creation of business hotels, providing a similar experience around the world,
99 year leases on property etc. His autobiography "Be My Guest" is actually
quite good.

~~~
dman
Thanks for the book recommendation, added to the reading list.

------
joshwa
Is the rental contract between the customer and the room provider or between
the customer and airbnb?

One way to approach enforcement would to be to set a threshold on the number
of units a room provider can offer without being subject to the hotel
regulations. AirBnB can easily enforce such restrictions.

~~~
_delirium
Imo, it'd be a good idea for AirBnB to independently attempt some sort of
threshold like that. I think its strongest niche is rooms or couches rented
out by actual people who also live at that location. But there are (esp in
NYC) a decent number of listings that are basically hostels / unlicensed
hotels, and not all are entirely up-front about the fact that you're renting a
room from a commercial operation that manages a bunch of rooms in the
property, not from an individual who lives there.

The rise of those kinds of operators has definitely made me warier of using
AirBnB now, while I used to be able to assume that most listings on the site
were legit individuals renting out rooms/couches in their own homes.

------
ctrager
"Chicago poised to license, regulate vacation-apartment rentals":
[http://www.chicagotribune.com/travel/ct-biz-0629-vacation-
re...](http://www.chicagotribune.com/travel/ct-biz-0629-vacation-rental--
20100628,0,1238267.story)

------
pavel_lishin
I wonder what the maximum occupancy laws are like. Could you get around this
by simply putting down on paper that you're subletting for a month when
they're just staying overnight?

~~~
graywh
Or perhaps by having no "early termination" penalty in the one month
"contract".

~~~
cschep
could this possibly be abused by them refusing to leave?

I guess if you put in the contract how much it costs per night they'd at least
legally owe you in full.

------
jeandenis
Similar initiatives have already be pushed in other cities with vibrant short-
term rental markets.

Short term sublets are already outlawed in some neighborhoods of London (e.g.
Belgravia, with a potential fine of ~20k pounds). There is also a similar law
in Paris since last December, although as a matter of practice it is only
enforced after complaints from co-op boards and neighbors who get annoyed at
the constant stream of vacation renters. The hotel lobby was behind the law in
Paris. Part of the justification was also that owners of short-term rentals,
often foreigners themselves, do not declare the rental income on the
properties.

------
_delirium
Does that mean these are actually legal currently? I assumed that they were
illegal in most jurisdictions, since most municipalities have _some_ sort of
regulation on short-term rentals, at least to the extent of requiring
registration and an occupancy tax paid, which most AirBnB 'landlords' aren't
complying with. But enforcement is difficult / not a priority when it comes to
single individuals renting out a room--- enforcement is usually directed more
towards, say, someone who owns an entire apartment complex running an
unlicensed hotel out of it.

------
Mc_Big_G
Well, now I know my original post wasn't misplaced!
<http://news.ycombinator.com/item?id=1471654>

Prior to reading some of the comments from NYC residents, I was vehemently
opposed to this kind of government interference, but now I'm not so sure. It
would suck to live next to some of these people.

I wonder if entire building communities could vote on whether to allow this
individually so either everyone agrees or disagrees and then has to live with
it.

------
acangiano
Nothing is as effective as government when it comes to curbing innovation.

~~~
ArturSoler
Good to find something that government is effective at.

------
jcromartie
It's bills like these (when passed) that make me laugh in the face of people
who tell me we have a free market economy.

------
samratjp
Sweet - this can only get more free publicity for AirBnB & similar services.

~~~
w1ntermute
Unless the bill is actually passed, in which case it would have a significant
negative impact as well.

~~~
jrockway
Yeah, just like how nobody uses illegal drugs anymore.

~~~
nerme
The people who sell illegal drugs don't advertise the fact on the web, at
least not for very long.

~~~
dschobel
Have you been to craigslist? Seriously, go take a look.

~~~
natrius
[http://www.statesman.com/blogs/content/shared-
gen/blogs/aust...](http://www.statesman.com/blogs/content/shared-
gen/blogs/austin/blotter/entries/2010/06/23/man_arrested_for_selling_marij.html)

The "not for very long" part still stands.

------
loewenskind
I've got an idea. Since the government is probably going to keep on giving
existing players legislative help to keep competition out anyway maybe what we
should do is pass an "Innovation stiflation act". That is, if you come to the
government asking for a law to keep out your competitors then they assign an
assessor (the same guy who values my house 40%" above what I could actually
get for it) to evaluate how much revenue you're going to get by not having
these competitors and we tax _that_ money at, say, 80%.

If we're not going to get the benefit competition would bring at least we
should get tax revenue out of it.

~~~
maxharris
That assessor will be bribed.

Instead of advocating an idea that attempts to turn two wrongs into a right
(tacking more regulation onto a problem you admit is caused by regulation),
advocate for something more fundamental: the complete separation of state and
economics.

------
holidayvelvetz
Paris apartments and accommodation. Paris short term stays for vacation and
holiday rentals accommodation. Self catering, family and group holidays and
luxury apartments in Paris France. thanks i like your post
<http://www.holiday-velvet.com/paris>

<http://www.holiday-velvet.com/paris>

------
mhp
This passed the NY Senate and is now in the Assembly. I wrote to my senator
(he co-sponsored the bill and obviously voted for it) and they called me
(which was nice). Apparently there is supposed to be an exemption if the
owner/renter is present.

------
mleonhard
A similar restriction is in place in Kauai, but the short-term rental industry
is somehow still operating.

