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US: Airbnb has urged New York City authorities to reverse legislation that came into effect last September, citing rising rents and a lack of alternative and affordable accommodation choice in the city since the regulations were enforced 12 months ago.
In a company blog post, Airbnb voiced its frustration at Local Law 18, which mandates that short-term rental hosts register with New York City government. The company said that the “unprecedented” regulations had “failed to deliver on their promise to combat the housing crisis”, and as a result, consumers were instead facing “all-time high hotel prices” and residents were facing “all-time high rents”.
Highlighting the consequences of Local Law 18, Airbnb quoted data from CoStar, which indicates that the average hotel prices in New York City had increased by 7.4 per cent in the last 12 months, compared to a 2.1 per cent rise on a national scale. The home-sharing firm said that it was evidence that hotels are risking pricing out everyday consumers out of travelling to New York City.
Despite legislators claiming last year that their approach would unlock more housing opportunities, StreetEasy reported a 3.4 per cent rise in average rental prices in New York City. In the same period, vacancy rates for apartments in the city have remained similar at 3.4 per cent, according to Apartment List.
Airbnb believes that this points to other factors besides short-term rentals driving up rent prices.
A report published by short-term rental data provider AirDNA in August revealed that the total number of NYC listings allowing stays of under 30 nights had fallen by 83 per cent since the implementation of Local Law 18, thereby restricting supply and accommodation options for travellers and revenue earning opportunities for hosts.
Theo Yedinsky, VP public policy at Airbnb, said: “New York City’s short-term rental regulations have backfired – disproportionately impacting outer borough communities, driving up travel costs, and doing nothing to solve the housing crisis. Instead of improving affordability, these regulations have priced out everyday consumers and left former hosts struggling to make ends meet.”
Instead, Airbnb believes that a solution to solving Local Law 18 is a “more balanced approach that recognises the value of short-term rentals while addressing one of the root causes of housing affordability – building more homes”.
Yedinsky continued: “It’s time for New York City to re-evaluate LL18 and consider amendments that would at a minimum, allow homeowners to once again host guests. By rolling back parts of the law, the city can increase the supply of accommodations for consumers, support resident hosts, and revitalise local businesses that depend on tourism dollars.
“A more sustainable, sensible and equitable model benefits residents, visitors, and the broader community – ensuring that regulations support, rather than stifle, community and economic growth,” he added.
Vacation rental software platform Lodgify recently surveyed its hosts in New York City about how Local Law 18 had affected them. On a scale of one to ten, they said that the law had affected their businesses by 8.5, with some noting that it had forced them to pause operations for more than three months, while others were put out of business entirely.
When asked about whether they thought the regulations would solve the city’s concerns about local affordability, tourist noise and overcrowding, hosts suggested that it had “done the opposite” and led to a rise in rents, adding that it was a “misguided law passed as a gift to the hotel lobby, which is seeing record room rates now”.
When asked about how the city can better balance the interests of its residents, tourists and hosts alike while addressing the negative impacts of unregulated short-term rentals, hosts said that “the ban should have been for buildings with more than four units only” and that the city should make it easy for those with one to three units to conveniently rent their vacation space.
Local Law 18 came into effect last year after a state Supreme Court judge dismissed a lawsuit brought by Airbnb against New York City over what it called “extreme and oppressive” restrictions and a “de facto ban” against its short-term rental operations in the city. The city responded by saying that it would spend time working with platforms to use its verification process.
Legal short-term rentals are properties with no more than two people hosted. The host has to reside in the dwelling unit, and guests must have access to all parts of the home.
Under the tighter regulations, eligible hosts must prove they live in the dwelling they are renting out and that the home meets municipal safety codes and other regulatory requirements. Hosts in violation of the new legislation could face fines from $1,000 to $5,000.
Platforms such as Airbnb and Vrbo are required to make sure anyone using their platform in New York follows city rules.
