State Legislature Passes Bill to Ban Online Advertisements of Illegal Short-Term Apartment Rentals

Assembly Member Linda B. Rosenthal

Assembly Member Linda B. Rosenthal

The legislation, which is the first of its kind in the Nation, represents New York’s newest tool in its battle with Airbnb. On June 17, 2016, the New York State Legislature passed the first state bill in the Nation to ban online advertisements for illegal apartment rentals. The bill, sponsored by Assembly Member Linda Rosenthal and Senator Andrew Lanza, seeks to protect the at-risk stock of the City’s affordable housing units, which are illegally rented most prominently through Airbnb. For CityLand’s previous coverage on the bill, click here.

Airbnb is an online home-sharing website that connects residential hosts with short-term renters. Landlords also use Airbnb to rent out their empty apartments for less than 30-day tenancies, because the earning potential for short-term rentals is substantially higher than for long-term rentals. However, these short-term rentals are illegal in New York pursuant to existing State law mandating a minimum thirty-day rental period for apartments in Class A multiple dwellings, which are buildings composed of three or more individual residential units. By banning most online listings advertising rental apartments for less than thirty days per renter, the bill makes it more difficult for landlords to turn residential units into illegal hotels, while making it easier for law enforcement personnel to hold accountable the offending landlords who advertise their illegal business online.

Offenders of the new law would be penalized $1,000 for their first violation, $5,000 for their second violation, and $7,500 for all violations committed thereafter. The new law would not apply to one- and two-family homes or to residents of homes who are renting out individual rooms while they continue to live in them.

The new legislation represents the latest action in the State and City governments’ battle with Airbnb. In November of 2015, City Council Member Helen Rosenthal sponsored a bill to substantially increase the civil penalty amount that must be issued by the Department of Buildings for the conversion of permanent residential housing units into illegal hotels. Mayor Bill de Blasio even weighed the pros and cons of the “sharing economy” with Trevor Noah on The Daily Show in May of 2016, months after a report had been released which proves that Airbnb is capable of regulating illegal apartment rentals on his website, regardless of whether it chooses to do regulate the illegal rentals or not.

Assembly Member Linda Rosenthal stated that Airbnb has disregarded New York’s illegal hotel laws for years. “This bill, once it is signed into law, will send a strong message that we prioritize hardworking New York families and affordable housing, and will give law enforcement the tools they need to crack down on illegal hotels that destabilize communities and deprive us of precious units of affordable housing,” said Assembly Member Rosenthal.

Senator Andrew Lanza stated that the legislation does not seek to affect innocent homeowners or interfere with anyone’s property rights, but instead, it is meant to provide law enforcement personnel with a mechanism through which to “hold law-breakers accountable.” “This legislation is intended to deter those bad actors threatening the safety and quality of life of neighborhoods across New York City by illegally operating hotels in residential rental environments,” said Senator Lanza.

New York State Governor Andrew Cuomo is expected to sign the bill into law.

N.Y. Senate Bill S6340A; N.Y. Assembly Bill A08704C (June 17, 2016).

By:  Jessica Soultanian-Braunstein (Jessica is the CityLaw Fellow and a New York Law School Graduate, Class of 2015)

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.