New York, how Airbnb’s short-term rental squeeze works

From today find a accommodation in New York it will never be the same again. Particularly with regards to the short term rentalsthose typically offered on platforms such as Airbnb – which takes the lion’s share – vrbo and similar. The new rules approved by the administration (it is the so-called Local law 18) in fact provide for a series of restrictions. Above all, it will not be possible to stay in a room or structure of this type more than two people at a timeregardless of the number of bedrooms present or the size of the house.

Managers will also need to be physically present while their property is rented, i.e. they either live in an adjoining room or house, still communicating, or renting is not allowed. Finally, the managers and visitors will have to leave the internal doors of the house open, so that all guests can have access to every space in the house.

They are highly restrictive rules, the meaning of which in some cases is not even well understood, which are added to others such as la mandatory registration of facilities in a dedicated municipal portal launched last March. Approved in January 2022, the new** Short-Term Rental Registration Law ** – this is the official name – seeks to harmonize some previous rules and applies only to properties rented for less than 30 days. According to the local administration, led by 62-year-old Democrat Erico Leroy Adams, the law aims at clean up the sector of illegal rents, ensure the safety of travelers and in the long run ease tensions in the real estate market, according to many, as in hundreds of cities around the world, “doped” by an excess of short-term rentals. Sanctions can even go as high as 5 thousand dollars.

“In my opinion, what they are doing in New York is basically close Airbnb – has explained Lisa Grossmana travel agent who has been using short-term rental platforms for years to list an apartment in her Manhattan home, at Washington Post – people who want to stay in apartments don’t want to be roommates with someone so there’s really no option. Either you’re a roommate or you’re in a hotel room.’ According to experts, in fact, these rules – especially in the points in which they reduce the privacy of travelers inside homes where several rooms are rented, with the aim of limiting the fictitious subdivision of apartments – will push people to the hotels or to other destinations with less stringent laws, such as neighboring New Jersey.

Airbnb’s response

Airbnb is obviously on a war footing, and has already filed a lawsuit against the administration in recent months with respect to the new rules, which is why the rules came into force with a certain delay on the approval of 2022: «Our goal is to It’s time to work with the City of New York to create sensible home sharing laws for our host community, and for much of the last decade, we’ve worked hard to find a way forward,” he said. Theo Yedinsky, director of global policies at the platform headed by Brian Chesky — New York City’s new short-term rental rules are a major blow to its tourism economy. The city is sending a clear message to millions of potential visitors who will now have fewer accommodation options when they visit: you are not welcome.”

Under the new restrictions, apartment owners and managers who want to offer them for rent on Airbnb, Vrbo, Booking and other sites must register with the Office of Special Enforcement for $145. If the request is approved, each facility will have a identification number which must be clearly indicated in the online announcement. According to the office’s website, “illegal short-term rentals can be dangerous to neighbors, guests and first responders. They may not have adequate fire safety systems in place and may not have enough exits in an emergency.” As of August 28, there had been 3,250 requests, of which at the moment only just over 200 have been approved and over 400 sent back with a request for further details.

The sanctions

For the guests there are no penaltieswhile for the managers they range from 100 to a thousand for the first violations, upwards up to 5 thousand dollars. However, those who have booked for the next few months can rest assured (even if, but this is true in any case and for each destination, they should still check the conditions of the rented structure): Airbnb will cancel and refund stays after December 1st. For those up to that date, on the other hand, it will honor the reservations as long as they were made before 5 September (among other things by reimbursing the service costs). In the meantime, will block further bookings for structures that have not been accredited.

The details of the law obviously allow you to lock yourself in the bathroom, bedroom and other private rooms while they are in use but the point is that these environments they must not be permanently inaccessible. Even if quite absurd consequences emerge from reading the rules. Like the following: «You can lock the bathroom door while using it, but the owner cannot lock his room and go out for the whole day» explained the expert Sean Hennessey, professor at the Jonathan M. Tisch Center of Hospitality at New York University. “So the guest can go to the owners’ room and they can go to the travellers’ room, at least that’s what the law says.” Extremes that have even puzzled some movements which have been fighting for clearer rules for years but which did not aim for such drastic and at times grotesque measures. Other groups and associations, on the other hand, are satisfied because they are convinced that these rules will bring many apartments back to the traditional real estate markethelping to mitigate the housing crisis affecting the city and to contain traditional rental prices.

New York numbers

For tourism, however, it risks changing quite a bit: New York was visited in 2022 by 56 million people and 63 million are expected for the current year. The 127 thousand hotel rooms of the metropolis are always quite full and therefore with high tariffs: for the whole year the occupancy rate is on average 65%, before Covid-19 it was around 85%. The average price since last January has been $264 per night per room, an increase of 16% compared to the January-June period of 2019. Not only that: rates are often higher in the second half of the year. In short, those who turned to the short-term rental market now risk having fewer opportunities and, also in this case, more expensive. Even considering that I’ve been in New York since 2010 hostels are also prohibited. Net of the real problem of the safety of the apartments. Last but not least, hotel rooms are often of limited size and those traveling in groups or large families could be forced to book more rooms, when on Airbnb they would have solved with a large apartment.