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News Travel Tourism: Anti-Airbnb Legislation New York Bans Short-Term Rentals of Entire Homes

News Travel Tourism: Anti-Airbnb Legislation New York Bans Short-Term Rentals of Entire Homes

If you attempt to rent an apartment for a few days of tourism in Brooklyn or Manhattan, you'll be surprised by the limited options on Airbnb or the Vrbo platform.

Similar to Paris, where finding accommodation can be a challenge, New York City has implemented a law this week that prohibits property owners from renting tens of thousands of tourist lodgings for periods less than 30 days.

Only Homestays Allowed The new legislation, stricter than Paris city regulations, which allow primary residences to be rented freely for a maximum of 120 days annually since 2021, permits homeowners to rent a room in their apartment only if they are present during the entire stay. Furthermore, no more than two tourists can occupy the room, and it must remain accessible.

Every short-term homeowner must register with the city and pay a $145 tax every two years. However, permits to rent have been granted to only around 10% of applicants so far.

Fines Ranging from $1,000 to $7,500 Penalties for illegal rentals are already set at between $1,000 and $7,500, but they will only apply to property owners.

The "Big Apple" is home to 8.5 million residents, not including the sprawling suburban areas, and is notorious for its housing crisis.

In Manhattan, monthly apartment rents, from studios to four-bedroom units, averaged $5,588 in July (+9.3% YoY), while in the trendy Brooklyn borough, the average rent reached $4,347 (+11.9% YoY), according to real estate firm Douglas Elliman.

Although the left-leaning municipal government officially aims to combat nuisances in neighborhoods caused by short-term rentals, the ultimate goal is to encourage more homes to re-enter the traditional rental market, potentially leading to lower prices.

Marianne LeNabat, a 44-year-old New Yorker, believes the city's decision is "probably necessary" as New York is "unaffordable."

She states, "Housing is completely unaffordable in New York, and (removing thousands of short-term rental units from the market) is obviously a problem."

Many New York landlords and Airbnb have long expressed their dissatisfaction with these regulations.

For the San Francisco-based platform and its Global Strategy Director, Theo Yedinski, "New York City is sending a very clear message to the millions of potential visitors who will have fewer choices: 'You are not welcome.'"

As for small property owners with one or two units, the prohibition of short-term rentals "will endanger their ability to repay their mortgages, causing an additional crisis in the housing market and putting them in financial and personal jeopardy," according to their association, Rhoar.

Tricia, a 63-year-old retiree who rents out the ground floor of her typical Brooklyn house for an average of $3,000 per month, emphasizes that almost everyone in her neighborhood owns their homes and bought them with the expectation of being able to do as they please. She vows to comply with the 30-day minimum rule.

"Shooting Themselves in the Foot" New York, known as "the city that never sleeps," rebounded from the Covid-19 pandemic after welcoming over 66 million tourists in 2019, generating more than $47 billion in revenue and employing 283,000 people.

However, the hospitality and restaurant sector is now facing a labor shortage, with many major establishments in Manhattan yet to reopen, and room rates soaring to hundreds of dollars per night.

"There are so many young people visiting New York who can't afford hotels," notes Joe McCambley, a 66-year-old Airbnb regular, who believes that New York is "shooting itself in the foot."

In a report commissioned by Airbnb, Michael Salinger, a professor at Boston University, writes that the new municipal legislation is not "economically justified" and will instead deal "a big blow" to the local economy without solving the housing shortage in New York.