Compass

Airbnb ruled illegal in New York

An Airbnb rental in New York. (Photo: googlisti / Flickr)

A New York City ruling has declared the room rental website Airbnb illegal, despite efforts by the company to intervene.

Officials determined that Nigel Warren, who used Airbnb to rent out his apartment, should pay $2,400 for being in violation of an illegal hotel law, according to CNET.

The rule bans rentals for fewer than 29 days. The law was initially set up as a way to block owners from turning their residences into hotels. But the law is only enforced when a complaint is filed -- so it's unclear what effect this will have on other Airbnb hosts, Fast Company reports.

The website, which allows members to rent out rooms for short periods of time, has become popular with travelers looking for alternatives to hotels.

For renters, it's a way to pocket extra cash -- especially in a city with expensive real estate.

Like eBay or Craigslist, the website creates the tools for the marketplace, and people have jumped in to take part -- New York City alone has more than 22,000 listings.

According to its website, Airbnb boasts listings in 33,000 cities and 192 countries. However, it has come up against problems with users flouting local ordinances in New York City as well as San Francisco, where the company was founded -- cities whose laws are not clear-cut when it comes to the casual rental market.

San Francisco officials are worried that landlords are taking advantage of the rental-sharing sites to dodge taxes and renter protection laws.

For its part, Airbnb offers tips for hosts and travelers, such as "be transparent" and "coordinate check-in times." But there is no mention of compliance with local ordinances.

Hosts have to certify that they will follow local laws, according to Airbnb spokesman Nick Papas. "Eighty-seven percent of people who are listing, are listing their own residence. We're not a platform for illegal hotels," he told Yahoo! by phone.

In an email statement to Yahoo!, Airbnb notes its "disappointment" with the New York City ruling.

"This decision runs contrary to the stated intention and the plain text of New York law, so obviously we are disappointed and we are considering all appeal options as we move forward. Put simply, this decision is wrong on the law, and bad for New York. The laws in New York and around the world are confusing and often contradictory, but we intervened in this case because this was the one area of the law that seemed most clear. This decision demonstrates how difficult (it) is for hosts and even companies like ours to adequately understand laws that were not meant to apply to regular people hosting to make ends meet.

"And more importantly, this decision makes it even more critical that New York law be clarified to make sure regular New Yorkers can occasionally rent out their own homes. There is universal agreement that occasional hosts like Nigel Warren were not the target of the 2010 law, but that agreement provides little comfort to the handful of people, like Nigel, who find themselves targeted by overzealous enforcement officials. It is time to fix this law and protect hosts who occasionally rent out their own homes. 87 percent of Airbnb hosts in New York list just a home they live in -- they are average New Yorkers trying to make ends meet, not illegal hotels that should be subject to the 2010 law."

An ABC story on rental-sharing sites advised, "Before you start accepting bookings, make sure you know your local laws for short-term rentals. These laws can vary greatly from city to city, so check with a local expert to see if you need certain permissions."

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