AirBnB appears to have navigated New York politics in a naive and inexperienced manner. Uber made a similar mistake early on, but graduated to a more sophisticated approach which involved working with local regulations as opposed to trying to bulldoze through them. Announcing that they are refusing to comply with a New York State AG's subpoena, versus more subtly seeking a backdoor face-saving solution, continues AirBnB's streak.
An acquaintance, living in a building whose management was very tolerant of the short-term rental of its units, recently saw a double-digit rent increase. The owner believed, probably correctly, that he was better off leasing his apartment to a series of short-term stayers versus a long-term tenant. Ignoring rental and regulatory volatility, this makes sense.
Point is, the gripes are real. They are also the kinds of social disagreements politics is designed to deal with. Blowing past that will probably backfire, particularly in New York.
Agree completely. But publicly announcing you're going to ignore the state AG amidst (a) claims by Albany that AirBnB is ignoring prior agreements and (b) an election season bringing in more populist, pro-renter candidates is bold in the wrong way.
As I read the article, the AG is targeting AirBNB, not individuals. The article calls the subpoena, "part of an investigation into whether the company is breaking the law by allowing its users to rent rooms in private homes." It certainly seems reasonable as part of such an investigation to determine the scope of illegal activity, which would require finding out fine-grained details on individual hosts.
The NY State AG is used as a stepping stone for higher office. They have more money than god and Schneiderman is loving this fight. Airbnb is not going to win here.
A judge will decide it but he will probably get the info on all the people that have rented their places for under 30 days.
We need so many more people just standing up and saying "no, fuck off" to overly intrusive government.
It's getting tiring where the USG at all levels is so busy farking over the freedoms of citizens while being utterly incompetent, wasteful and useless on so many other fronts.
It seems that denouncing the government is the only truly patriotic action one can now take.
If AirBnb was not a US based company and instead say they were based in Europe or some tiny little island with no laws whatsoever, would the US laws still apply?
Their business model continues to work worldwide, no matter where they are located...
I can understand the gripe with the rents increasing, but AirBnb is only one enabler, this kind of thing was possible before using Craigslist, it's just it was more hassle involved. If the hosts believe AirBnb violated their trust and gave away their information, they will must move onto The Next Best Thing(tm).
Lots of people immediately jump to the "hotel industry protection" line of reasoning here. There's a pretty good write-up from 2010 covering common myths and reasons for wanting short-term rental protection in a place like NYC. I recommend everyone read this if this topic interests you:
"What New York State's Illegal Hotels Law Means for Travelers"
Is there anything preventing the AG from subpoenaing strictly the records of people who actually fit the bill of what they're looking for?
According to the WSJ[1] the investigation is looking strictly at "people who might be trying to skirt New York's laws by renting out multiple units or obtaining their primary residence through Airbnb for extended periods"
It seems like this can be accomplished without a whole-hog dump of every NYC-area landlord. Why not have AirBnb dump this data, with a neutral third party auditing?
One thing that doesn't smell right though:
> "Airbnb has about 15,000 hosts—or people who share their living space—spread out among New York City's five boroughs, with 87% of them renting out the homes that they live in."
I call shenanigans on this. I've done searches throughout NYC as a curiosity exercise last time this topic came up. "Whole apartment" listings vastly outnumber "room in apartment" or "shared room" listings. The notion that the vast majority of Airbnb landlords are present, or renting out parts of their existing homes, does not seem to bear out in reality.
From the AG's perspective, pretty much everyone in New York renting their place via Airbnb is breaking the law. That their goal is to only go after the flagrant violators doesn't really change the validity of their subpoena.
It says "renting out the homes that they live in". Things it does not say: "renting out part of the homes that they live in" and "are present in the home during the rental period".
If I'm on the other side of the planet for a few weeks, I still live in my home in Washington, although I am not present at that time.
Sadly, AirBnb doesn't have an API I can poke at to make it more scientific - but I went through a bunch of listings in NYC a few days ago, and nearly all of the "whole apartment" listings are professional operations that operate year-round, not ad hoc arrangements (i.e., "I'm out of town, take my place").
One easy way to tell is to take a peek at the property's calendar. I'm pretty sure regular bookings for months at a time suggests it's not exactly someone renting out their primary residence.
I don't really get the "obtaining their primary residence through Airbnb for extended periods" line - does this mean living at Airbnbs with no other permanent address is breaking a NY law?
Why would it be BS? Really, there are laws and far too many startups gloss right over them and then all shocked and such that it applies to them. Then they double down their idiocy by trying to gen up support from people equally ignorant of the law or just anti-government in general.
So, yeah, court order, the charge will be with tax evasion if they really want to get rough.
The laws in this case exist solely to enrich very entrenched interests, specifically hotels that legally bribe (aka lobby) politicians to regulate their little part of the world to keep competition out.
What an entirely myopic view. The core of hotel regulation stems from decades of hard-learned lessons - NYC's lodging and housing laws are a mile long because they represent the tens of thousands of ways that landlords and hoteliers have discovered over centuries to fuck over their tenants.
Regulations also aren't free. As we've added to housing regulation, compliance costs have risen, and like any other industry high regulatory compliance costs discourage competition from small businesses. Regulations also ensnare unintended targets, especially when they've been iteratively built upon over decades or centuries. Like code, it is difficult to predict the full behavior of a piece of legislation over a vast and complex economy.
This puts us in a tricky balancing act. We need regulation because we've observed the many, many ways an unregulated market tends to fuck over its own customers. We also need to limit regulation in order to preserve competition and avoid people getting screwed by the law even when they aren't the intended targets of said laws.
There are, of course, malicious actors within the system on both sides. Those who seek to add regulations that have little to no public benefit, to further their own interests, and those who seek to remove necessary regulation to further theirs. The incumbent hotel industry tend to represent the former, and AirBnb represents the latter. Neither are working in the interests of the public, though they would both claim to be.
Both sides, if permitted the full extent of their desired regulations (or lack thereof) would be disastrous for the public and consumers. We, as the public, need to reign them both in, letting either side "win" would be silly and shitty.
The effective approach that has let Uber thrive in battles like this is to leverage thier community.
Everywhere you look at the Uber debate, the story is told as members of the community standing up to the old guard – but the airbnb story right now feels like an insurgent brand standing up to the authorities.
I think this is the only way to go about getting change. If you just comply from square one, officials preceive no problem.
If you want change, you need to make people realize that there is a problem with the current system... and ignoring the laws, and then working to get them changed after the problem has been realized (a la Uber) seems to be a lot more effective.
You can't get people excited to change something they don't know/care about!
It is kind of mission critical that they don't, correct? I have stayed in one lady's place who even mentioned to us that it wasn't exactly kosher with the landlord, but she was going out of town for a conference anyway and would be gone for the week.
I see it as mission critical because it would be too easy for landlords to take that information and use it against people.
As someone on the condo board of a building, I can guarantee you that we don't need any data dump to locate people illegally renting out units in our building. We regularly look on AirBnB and VRBO for units within our building that are easily identifiable through the photographs in the listing and fine anyone in violation of the condo rules.
Other than the fact that such rentals are against the rules (malum prohibitum), has your condo board seen actual damages from such website-mediated-rentals, making the practice wrong in-and-of-itself (malum in se)?
The rules probably date back to when such arrangments were often quite sketchy and informal, whereas the Airbnb era adds traceable payments/stay-records, sticky reputations linked to real-world identities, and a commercial-entity's own "guarantee" against harms. So would the board consider waiving those rules under certain situations? It seems the option to rent out property in some cases will protect or improve the property's value... which I presume is one of the major goals of the condo board.
The rules date back to when I and the rest of the board put them into effect a few months ago. I can't imagine a situation where the option to short-term rent will ever increase property value. We have had short-term rental guests not obey other condo rules and cause damage / mess within the common areas of the building. The minimum rental period in our building is 12 months and we do not wish anyone sharing our common elements for a time period less than that. Everyone in the building is free to disagree, vote us out, then change the policy, but no one has expressed any desire to change this policy.
Thanks for your answers. Do you know if the problematic short-term guests came via Airbnb or some other avenue?
"No one has expressed any desire to change the policy" - not even the people who've been fined? (Were they renters subletting, or owners flaunting the rules?)
The unit that caused the biggest problem was listed on 2+ sites, so it is unclear which guests came from which platform. The person previously renting (an owner) ignored multiple requests to stop and only stopped when a fine was introduced. In the NYC market these situations can be very profitable so it is in the renter's/owner's interest to break the rules as much as they feel they can get away with until the equation no longer becomes profitable. This is how condo boards fight the situation -- the fines have to be heavy enough that it impacts the profitability of the entire concept. The condo board is in a position to put a lien on the unit for the money owed, so owners can not ignore the rules without potentially severe consequences.
But it's clearly more than "no one" would would like to pursue this profitable opportunity without fines, right? (Maybe they're the kind of people who don't show up and vote at condo association meetings, but presumably they're not voting in favor of the rules/fines but then blatantly violating them.)
Good idea to put "guarantee" in scare quotes. If Airbnb had an actual guarantee that landlords or tenants could depend on their terms and conditions would not be as scary as the are: https://www.airbnb.com/terms
Note especially this heartwarming section: "You acknowledge and agree that you and Airbnb are each waiving the right to a trial by jury or to participate as a plaintiff or class member in any purported class action or representative proceeding. Further, unless both you and Airbnb otherwise agree in writing, the arbitrator may not consolidate more than one person's claims, and may not otherwise preside over any form of any class or representative proceeding."
"I see it as mission critical because it would be too easy for landlords to take that information and use it against people."
Well they could've done themselves a favor by not illegally subletting their rental. I don't mind the concept of Airbnb but it's laughable that proponents glaze over the fact that rental agreements often prohibit subletting yet Airbnb users still rent their space anyway.
If Elliot Spitzer were still the AG, RICO would have been invoked already and they AirBnB officers would be looking at jail time.
Some violations of the Multiple Dwelling Law are misdemeanors while others are civil penalties. But in so far as NYC is concerned, AirBnB is facilitating and profiting from illegal acts.
Seems like Airbnb wants to wrestle with the long arm of the government. This will be an interesting to watch, although the saying goes: you don't wrestle with a pig. You will get dirt and the big likes it. And Feds will most likely love to get any reason to reopen the FBI probe into Nathan's case.
When you rent out a space there are laws designed to protect the renter, and many leases have clauses prohibiting subletting. Odds are many of these laws/contracts are being broken, so what do you expect?
Because it's an internet start-up you're allowed to break the law?
Because it's an internet start-up you're allowed to break the law?
Well yes, that's what they're saying. "Internet is different" is the very principle Amazon invoked to not collect sales tax for years. (I'm not saying I agree.)
Well at the time wasn't any law stating that Amazon had to collect sales tax where it didn't have a physical presence, that was up for debate. Unlike the laws that AirBnB are currently ignoring, that matter is already settled.
> "Internet is different" is the very principle Amazon invoked to not collect sales tax for years.
No, its not; Amazon sought to have legal rulings that had been applied to remote selling (by mail and telephone order) applied to remote selling by internet in exactly the same way that they had been applied to other means of remote selling.
It was exactly the opposite of "Internet is different."
Amazon claimed it had no physical presence in California so that they would fall under the existing laws. That's not true, though. Lots of Amazon employees work in California. They got very creative with the definition of "Amazon" and "employee" to make the claim.
As a long-term occupant of Manhattan, I (and others) believe that AirBnB ignores the feelings of those of us that want safety and security in our apartment buildings and that we certainly do not want strangers living there.
I'm only sorry that the AG didn't go after AirBnB earlier.
The reason Uber can work with the government is that they are taking on the taxi cartel on behalf of city residents. They are therefore aligned with voters, who the pols care about.
AirBnB otoh is aligned with a small minority of owners against the larger number of renters pissed off that their already high rents are exploding. The pols are taking these actions because voters are upset. AirBnB are on the wrong side of the divide. This may thus end badly for them in NY. Other cities will copy NY, and so this is a fundamental challenge to their core value prop.
> It also prohibits residents of certain buildings from renting their accommodations for under 30 days.
That is not how I would summarize the law. It prohibits residents of most buildings from renting for under 30 days. The exclusions are mainly around existing buildings that would violate the law, without Airbnb style rentals, namely university-owned buildings that are used for short-term rentals in the summer and older buildings that are apartment/hotel mixes.
Actually, legally, they sort of have to give up the data. They are taking a risk not handing over the data, thankfully it's the right risk to take. The law is malleable for a reason; laws often become outdated.
Business wise they should to do this, yes, but that still doesn't mean it's an easy "they sort of have to" situation.
Oh, I definitely think that they'll have to give up the data eventually, but considering that their business model is at stake, they have to at least try to hold out.
I'm not a proponent of AirBnB's business model, but I can understand their attempt a refusal.
The fight is more important than the outcome, in some ways. It will be interesting to see how they play the PR/legal/international angles to get at least decent results in NY.
fine... every roach-infested apartment can be rented out regardless of whether it has running hot water or heat in the winter time, air conditioning etc. indeed there is a sucker born every minute.
Provides stability to the residential community, preventing disruption from transients not invested in the social fabric of the community, who feel free to be a nuisance.
That's the PR response. While there is truth to it, surely there is an element of entrenched industries using their money and power to protect themselves.
Why do hotels have different building codes? If the room I'm sleeping in catches fire and collapses, no legal arrangement with the landlord is going to save me.
All types of buildings have different building codes.
Apartment buildings may have different codes depending on their height (you can't build a 10 story wooden building for instance), there's codes which regulate exits, access, max occupancy, etc... Single family homes have different code to follow because the expectation is that only 1 family will be living in it, versus an office tower or hotel with thousands...
A relevant example - not every basement is suitable as a living suite, but many are rented out anyway, which is against the law (there are certain codes which much be followed to ensure a rental suite is legal). This would apply to AirBnB as well. Traditional bed and breakfast places have rules to follow as well, business regulations, building code, etc...
Because the occupants of a hotel are temporary and not familiar with the building, the building operator takes on more responsibility for their well-being. Partly this is in better fire protection, partly this in things like having those exit plans on the door and having a designated fire safety director.
If the room I'm sleeping in catches fire and collapses, no legal arrangement with the landlord is going to save me.
Since you mention it, I suspect that an "official" hotel room has to be built and maintained to a much higher standard than someone's house or apartment. Width of exits, sprinkler systems, etc.
Sure, but having lived in two buildings (Brooklyn) in which neighbors have made AirBNB hotels out of their apartments, I seriously hope AirBNB gets gutted on this. Why should other tenants who don't AirBNB share the risk of the spread of bedbugs, increased chance of crime, and potentially dangerous or annoying strangers in shared spaces (hallways, common areas)?
Is there any evidence that AirBNB rented rooms increase the spread of bed bugs, crime, and dangerous people?
As an interesting counterpoint here, it's legal to let someone crash on your couch, but the second you ask a dollar from them for the space, everything changes. That doesn't necessarily make sense to me.
It's strangers over the internet - the same that report bedbug issues if you google for those terms. Bedbugs are spread by travelers, sometimes NYC hotels are to even blame.
People that do AirBNB in NYC aren't doing it at the same recurrence rate as 'having someone crash on the couch.' Either AirBNB hosts are trying to control the tone on hackernews or people are seriously oblivious to reality.
The person you let crash on your couch for free is likely someone you know, who is at least somewhat socially beholden to you.
The person who paid you to sleep on your couch is just some person with cash. Especially if you are not around, they're much less likely to feel socially obligated to treat the place like their own.
To put this in perspective, one of the most prominent illegal residental-building-to-hotel conversions that was originally causing problems for residents was called the Marriott ExecuStay[1] and was owned by a small-time hotel chain called Marriott International. The entrenched industries were already taking advantage of the lax regulations and enforcement.
One benefit is that it allows rent control. Without this, the arguments in favor of rent control go out the window - if the tenant can make significantly more renting out the apartment than they are currently paying, there's no legitimate reason to force their landlord to charge below market rents.
It is reasonable for the government to regulate short-term rentals in regard to health and safety as well as to protect neighbors from the hassles of living next to short-term rentals. This is why zoning laws exist.
An acquaintance, living in a building whose management was very tolerant of the short-term rental of its units, recently saw a double-digit rent increase. The owner believed, probably correctly, that he was better off leasing his apartment to a series of short-term stayers versus a long-term tenant. Ignoring rental and regulatory volatility, this makes sense.
Point is, the gripes are real. They are also the kinds of social disagreements politics is designed to deal with. Blowing past that will probably backfire, particularly in New York.