New law shuts down Airbnb in New York with the threat of heavy fines

Central Park foliage photo-walk, Nov 2009 - 03
Photo by Ed Yourdon
Apartment buildings on the East side of Manhattan. Class A multiple dwellings such as these will no longer be available for short-term rentals under a new law signed by Gov. Andrew Cuomo.


A new state law makes it illegal to advertise short-term apartment rentals, essentially putting an end to Airbnb and other home-sharing services in New York state.
Fines will be $1,000 for the first offense; $5,000 for the second offense; and $7,500 for the third and later offenses.

The bill (A.8704-a/S.06340-a) specifically prohibits “advertising that promotes the use of dwelling units in a class A multiple dwelling for purposes other than permanent residence.”
New Yorkers are barred from advertising their apartments on Airbnb and other social media platforms for less than 30 days.

Under the new law, a multiple dwelling is defined as “a classification of housing where multiple separate housing units for residential inhabitants are contained within one building or several buildings within one complex.”

A “class A” multiple dwelling is defined as “a multiple dwelling which is occupied, as a rule, for permanent residence purposes.”

The text of the bill can be found here.
Hours after the law was signed, Airbnb filed a legal challenge in federal court. New York City and state officials have indicated they will not begin enforcing the new rules until the lawsuit is settled.
If the law is upheld, it would shut down Airbnb’s largest market.

It was already illegal in New York City to occupy a class A multiple dwelling unit for fewer than 30 days, but the new law clarifies that it also illegal to advertise units for occupancy that would violate New York law, placing the onus on Airbnb and similar home sharing websites.
Opponents of Airbnb and the short-term rental market say it artificially inflates the value of apartments in New York City, where housing is already at a premium.

“This law will help to keep housing available and affordable for thousands of hard working New Yorkers and their families,” said Linda Rosenthal, D-Manhattan, the sponsor of the Assembly bill.
“Airbnb has revolutionized the illegal hotel industry, making it easier than ever for illegal hotel operators to drive up housing costs and steal affordable housing from our communities,” Rosenthal continued. “More than 50 percent of all Airbnb listing are illegal, and they have robbed New Yorkers … of affordable housing.”

Sen. Liz Krueger, D-Manhattan, a fierce opponent of short-term rentals in New York City, was a sponsor of the Senate bill. She too says “illegal hotels” creates a housing shortage.
“For too long companies like Airbnb have encouraged illegal activity that takes housing off the market and makes our affordability crisis worse,” Krueger said. They have sat idly by while unwitting ‘hosts’ are evicted for breaking their leases, unscrupulous landlords drive out tenants to profit off the short-term market, and tourists are put in danger by staying in unregulated, unaccountable, and often dangerous illegal hotels.”

Krueger notes that the new law still allows people to rent out spare rooms for less than 30 days if they will still be present in the apartment for the duration. The law does not apply to single and two-family homes.

“In spite of Airbnb’s misleading statements to the contrary, those who want to legally use sites like Airbnb — for example by renting out a spare room while they remain in residence — are still free to do so, as they have always been. But those who are breaking our laws and disrupting their neighbors and communities will now face stiffer penalties.”

The Senate bill was sponsored by Andrew Lanza, R-Staten Island.