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New York’s Airbnb Ban Is Descending Into Pure Chaos

Oct 9, 2023 7:00 AM

New York’s Airbnb Ban Is Descending Into Pure Chaos

People are listing short-term rentals on social media and lesser-known platforms, bolstering a rental black market in New York City.

Manhattan city skyline

Photograph: ED JONES/Getty Images

As few as 2 percent of New York City’s previous 22,000 short-term rentals on Airbnb have been registered with the city since a new law banning most listings came into effect in early September. But many illegal short-term rental listings are now being advertised on social media and lesser known platforms, with some still seemingly being listed on Airbnb itself.

The number of short-term listings on Airbnb has fallen by more than 80 percent, from 22,434 in August to just 3,227 by October 1, according to Inside Airbnb, a watchdog group that tracks the booking platform. But just 417 properties have been registered with the city, suggesting that very few of the city’s short-term rentals have been able to get permission to continue operating.

The crackdown in New York has created a “black market” for short-term rentals in the city, claims Lisa Grossman, a spokesperson for Restore Homeowner Autonomy and Rights (RHOAR), a local group that opposed the law. Grossman says she’s seen the short-term rental market pick up steam on places like Facebook since the ban. “People are going underground,” she says.

New York’s crackdown on short-term rentals has dramatically reshaped the vacation rental market in the city. People are using sites like Craigslist, Facebook, Houfy, and others, where they can search for guests or places to book without the checks and balances of booking platforms like Airbnb. Hotel prices are expected to rise with more demand.

Search for a short stay on Airbnb, and there are few places scattered across the map. Many of those old listings have turned into stays of 30 days or longer—meaning they do not need to be registered.

AirDNA, a short-term rental intelligence firm, found just 2,300 short-term rentals on Airbnb in New York City by late September. The number of stays advertised as long-term rentals now makes up 94 percent of Airbnb’s listings in the city, AirDNA’s data shows. Hosts must meet strict requirements to be approved as a short-term rental—they can have only two guests, and the host must be present in the home during the stay. This change banned many whole apartment listings, except for those that fell under a Class B dwelling category, like hotels, boarding houses, and clubs.

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But people are finding ways around the rules. Many listings on Airbnb now include a space in the property’s description for hosts to enter a registration number or state that they are exempt. WIRED searched Airbnb for stays in New York and found many short-term rentals that list themselves as exempt from the city’s registration rules, but there are still several entire units available for short stays that do not appear to be hotels or exempt units.

In one listing marked as exempt, the host asks for guests to avoid interacting with the building’s concierge. On another listing, a host claims they used to live in the unit but have moved to New Jersey and now rent it out. One appears to be a rowhome in a mostly residential neighborhood in Brooklyn. Airbnb uses the city’s verification system to flag unregistered units. The company did not provide comment for this story addressing these specific listings flagged by WIRED. Nathan Rotman, the public policy regional lead for Airbnb, says the company is “working closely” with the city as it implements the new registration law.

Inside Airbnb’s data shows some 2,300 short-term properties have listed themselves as exempt from registration on Airbnb. There are a few hundred more that do not say whether they are exempt or registered, according to the data. Another 35,000 are long-term rentals. Airbnb did not confirm the numbers in the data scraped by Inside Airbnb. The Mayor's Office of Special Enforcement in New York, which manages the registration program, did not provide an update on the total number of short-term rentals it has registered, or whether it has issued violations for illegal listings.

The New York City law is just one striking way cities are fighting back against short-term rentals. Supporters of the rule argued it would free up apartments for New Yorkers, who pay high rent prices and are facing housing shortages and insecurity. But others, including small-time landlords, said it would take away a source of flexible extra income without making a dent in the housing supply crisis.

Those smaller landlords are still pushing New York City councilors to change the rules to allow them to rent out their units. RHOAR is made up of hosts who own and occupy single-family homes or homes with two dwelling units. These hosts feel they have been unfairly looped in with big landlords. Grossman says RHOAR has met with city councilors in hopes of changing the law so that smaller hosts can still legally do short-term renting.

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Outside of Airbnb, people are posting listings and seeking short-term rentals in Facebook groups. Ads on Craigslist for rentals have weekly or nightly prices listed—WIRED found one listing with a weekly and nightly price on Craigslist that also appears on Airbnb, but can only be booked for 30 days or longer on Airbnb. These off-platform rentals pose risks to both guests and hosts, who could get scammed without the protections of bigger companies like Airbnb.

Craigslist did not respond to a request for comment. Meta, Facebook's parent company, did not comment on specific listings flagged by WIRED, but the company's policies require buyers and sellers in Facebook Marketplace to comply with local laws, and the company prohibits people from promoting illegal activity in Facebook pages and groups.

Then there’s Houfy, another website listing short-term rentals. WIRED found that many of the listings come from guests who joined the site in September, the same month New York’s new registration rules took effect. The intention is for guests to book directly with hosts—think Airbnb without the fees. The site compares prices for the same property on Airbnb and Houfy and claims to show how much people can save by avoiding Airbnb’s fees.

Houfy has received a notice from New York City about the new rule and is “reviewing how to comply with their rules,” Thijs Aaftink, CEO of Houfy, tells WIRED. Aaftink says Houfy, unlike Airbnb and other rental sites, does not take commissions on transactions between hosts and guests, and argues the company “is therefore not part of the transaction.” He says hosts are responsible for complying with local laws when listing properties.

After the rule change, Airbnb is shifting attention away from New York, which was once its biggest market. Airbnb CEO Brian Chesky has recently said the company is exploring longer rentals, as well as car rentals and dining pop-ups. And it has got its eyes on Paris, its largest market and home to the 2024 Summer Olympics.

“I was always hopeful that New York City would lead the way—that we would find a solution in New York, and people would say, ‘If they can make it in New York, they can make it anywhere,’” Chesky said during an event in September hosted by Skift, a travel industry news site. “I think, unfortunately, New York is no longer leading the way—it’s probably a cautionary tale.”

Updated 10-9-2023, 1 pm EDT: This story was updated to correct the description of RHOAR's membership.

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Amanda Hoover is a general assignment staff writer at WIRED. She previously wrote tech features for Morning Brew and covered New Jersey state government for The Star-Ledger. She was born in Philadelphia, lives in New York, and is a graduate of Northeastern University.
Staff Writer

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