Lifestyle

Airbnb rules will make your next trip to New York City even more expensive


Rules again dangling on the field of short-term rentalbest known for vacation rentals found on platforms like Airbnb and Vrbo.

Places like Maui, Hawaii and Atlanta limit the number of apartments that homeowners can list online. Other cities like Paris limit the number of days a landlord can rent an apartment. New York City’s latest law requires landlords to register with the city, or risk listing platforms not processing their payments.

There are more than 40,000 Airbnb listings in New York City, according to monitoring group Inside the Airbnb. The executive director of the New York City Office of Special Enforcement told New York Daily News late last year that this latest regulation, Local Rule 18, could remove more than 10,000 listings from Airbnb.

While you may end up paying more for a New York hotel room or vacation rental, don’t sing a swan song for Airbnb.

“Like regulations in general, especially for things like vacation rentals, I think enforcement,” said Makarand Mody, an associate professor and director of research at Boston University’s School of Hotel Administration. it is a real challenge. “For that reason, I don’t think it’s going to have as big of an impact as a quarter of the inventory hitting the market.”

New York City has banned rentals of houses or apartments for less than 30 days if the owner is not present during the stay. However, Local Law 18 requires landlords who have complied with applicable guidelines and plan to rent space to register with the city database and obtain a registration number.

Listing platforms like Airbnb and Vrbo would then have to verify that number before listing a home and processing payments for that listing. Failure to comply with the new measure means landlords could end up owing the city between $1,000 and $5,000 in fines.

Mody is not at all in favor of renting an illegal vacation rental unit, nor does it support landlords who do not comply with the measures. But he is the latest of many to note that all these regulations for the growing short-term rental industry are difficult to enforce.

If you search for a four-night stay in February and filter your Airbnb search by entire homes and apartments, you won’t be able to find any listings in New York City. Instead, you can find more than 1,000.

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It’s more news than actual enforcement or any kind of real impact on the Airbnb offering, Mody added.

short staffing

The latest regulation comes after years of failed efforts by New York City to rein in lawbreakers in the short-term rental sector.

There are about 13,000 homes – not all of them on the vacation rental platform – that are regularly rented illegally in New York City, according to The Real Deal.

Christian Klossner, executive director of the mayor’s special enforcement office, told the real estate news site that he and his team of 30 don’t have the resources to hunt down rule-breakers.

“Someone who is living in their own home, renting it out a few times a year sometimes, and doing it in a way that they don’t drive the neighbors crazy is not a priority for us,” he added to TRD. “We have bigger fish to fry.”

ZACH GRIFF/THE POINT

Contingency plan

This doesn’t quite mean going ahead and booking whatever New York City Airbnb you find online. A person is always at risk of being evicted during their stay if the city discovers that an apartment is illegally rented and occupied.

There are also plenty of warning signs that the new regulation is doing legitimate damage to overall listing availability — especially if it’s a matter of whether landlords are getting paid.

Airbnb sent users an email in December linking to a form where they can complain to New York officials about the new rule. But the company indicated on Monday to TPG that no single city in the world or potential regulatory obstacles could significantly affect overall performance.

“Over the past decade, our Host community has continued to grow, thanks in part to the work we have done with cities around the world to support clear, balanced regulations that bring provides certainty to the Landlord and allows the community to benefit from short-term economic activity. an Airbnb spokesperson said in a statement. “Nearly 90% of our top 200 markets by revenue worldwide have certain regulations, and no single city accounts for more than 1.5% of our revenue.”

New York City represents less than 1% of all active Airbnb listings worldwide.

The new regulation is likely to put a strain on travelers’ wallets, as less supply gives landlords and hoteliers more power to charge more. Even with the average hotel occupancy down 13% from last year’s pre-pandemic levels, the average daily rate in New York City is still slightly above 13%, according to STR.

At the end of January this year, the average daily hotel price in New York City was only about $200 a night. At the same time in 2019, the average price was slightly higher than $177 a night.

One can correlate with some of the pricing power that hoteliers derive from holiday rentals that are already lower than normal in the market. According to rental analytics firm AirDNA, the number of short-term rental listings in New York City has dropped during the pandemic. By the end of last year, the city was still only recovering 60% of its peak at the end of 2018.

“I don’t think this is slowing growth,” said Kevin Davis, CEO of JLL Hotels & Hospitality, Americas. “It changes the way these companies grow, and frankly, it has an effect on the wages people pay. To the extent that Airbnb or short-term rentals are harder to do in cities, what will happen is that existing properties will generally continue to exist. There may not be new supply in that municipality, so prices for existing properties will go up.”

A new tune

MARRIOTT HOME AND VILLA

There’s something different about this latest regulatory expansion from years past.

First, this isn’t a showdown between Airbnb and hotel companies over the past year regarding short-term rental landlords that don’t have the same safety and tax requirements as a traditional hotel.

Instead, the city government this time around is trying to do things like provide more year-round housing for those who say the short-term rental craze in recent years has driven them out of the cities. neighborhood.

While this new scrutiny may cause a blow to the growth rate of the holiday rental industry as a whole in certain parts of the world, it will not be the death knell for this type of business. this accommodation.

When a city introduces short-term rental regulations, prices go up, says David. But adjoining towns and cities that are not regulated will likely see short-term rents rise to make up for the limits set by the adjoining city.

“This is a new phenomenon in many places where the municipalities have yet to respond, certainly in big cities like New York,” Davis added. “[In] other markets where we see a lot of short-term rentals [like] Savannah, New Orleans and Palm Springs, you’ve seen those markets enact laws. But at the end of the day, I don’t think that will be a limit. That’s a minor hitch in certain jurisdictions, but overall it won’t affect overall growth.”

There is also an expectation that many hotel companies will not only accept that short-term rentals are here to stay – but they will jump into the game themselves.

Marriott was in space with Marriott Bonvoy’s Houses & Villaswhile Accor offers vacation rentals through Onefinestay. Mandarin Oriental Monopoly And Four Seasons Private Vacation are hotel brand providers at the end of the ultra-luxury region.

“My prediction is that in about the next 5 years you will see owners of traditional hospitality [companies] also owns short-term leases,” Davis said. “From a consumer perspective, I think they will see a higher quality product and more organized and built assets.”

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