Airbnb has filed a lawsuit in New York City [Unsplash]

Airbnb files lawsuit over “oppressive” restrictions in New York City

US: Airbnb has filed a lawsuit in New York City over “extreme and oppressive” restrictions and a “de facto ban” against short-term rentals that are set to come into effect next month. 

The lawsuit was filed in the New York State Supreme Court in Manhattan, while three hosts through the platform simultaneously filed a companion lawsuit against the city due to the regulations.

The lawsuit concerns an ordinance that was passed last year and is set to be brought into enforcement in July by New York’s city council. The ordinance would require owners to register with the city mayor’s office, disclose the names of all residents who live in the property, and pledge to comply with separate zoning, construction and maintenance ordinances.

In its filing, Airbnb argued that the city council had effectively introduced “its most extreme and oppressive regulatory scheme yet” and that it had imposed arbitrary restrictions that would significantly reduce rental supply, even if the city council does not explicitly ban short-term rentals outright in New York City.

According to the home-sharing platform, over 5,500 short-term rentals are booked to host more than 10,000 guests in New York City in the first week of July.

In 2019, when a previous law restricting short-term rental operations in New York City came into effect, Airbnb said that 29,000 hosts were forced to leave the short-term rental market. The firm is now calling for the New York State Supreme Court to block the rollout of ‘Local Law 2018’, which enforces host registration with the New York City Mayor’s Office of Special Enforcement [OSE] and compliance with the aforementioned ordinances, because it believes the “maze of complex regulations would mean that “only a minuscule number of hosts would ever be granted a registration”.

Airbnb told its hosts that it been left with little choice but to pursue legal action against the city as it had “exhausted all available paths” and the OSE had “failed to consider reasonable alternatives” to keep the short-term rental market operating in New York City.

The conflict between Airbnb and the city dates back many years but a key juncture was in 2016 when the platform sued New York state over a ban on advertising short-term rentals. Though the lawsuit was dropped when the city decided not to enforce the ban, the debate raged on four years later when Airbnb settled another New York lawsuit regarding a dispute over monthly reporting requirements for its listings.

Airbnb insists that the 2022 ordinance, which is due to come into force next month, is a violation of the two previous lawsuit settlements.

Like New York City, New Orleans is another US city that is seeking to regulate short-term rentals without banning them outright, after a previous law was rejected by a local court.

Critics who oppose the proliferation of short-term rentals point to perceived issues around a shortage of affordable housing, loud noise, anti-social behaviour and safety concerns as a reason to tighten regulation of the market.

The news comes ahead of the upcoming Skift Short-Term Rental Summit, which takes place in New York City on 7 June.

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