In a recent blog post, Airbnb has called on New York City to reconsider its strict regulations on short-term rentals, implemented under Local Law LL18 in September 2023. The company argues that these regulations have not alleviated the city’s housing crisis but have instead driven up travel costs for visitors and decreased accommodation options for both tourists and locals. Airbnb is urging city officials to roll back portions of the law, claiming they are negatively impacting tourism and small businesses dependent on visitors.
Local Law LL18 mandates that Airbnb hosts in New York City meet specific criteria to rent out their properties on a short-term basis. Hosts must be permanent residents of the units they rent out and register with the city before listing stays under 30 nights. The law was introduced to address concerns about the impact of short-term rentals on the housing market, specifically claims that they contributed to the city’s affordability issues. According to the city, the regulations aimed to combat rising rent prices by limiting the number of apartments available for short-term stays.
However, Airbnb contends that these regulations have had minimal impact on New York City’s housing crisis. Citing data from Apartment List, the company points out that the vacancy rate for apartments in New York City has remained unchanged at 3.4% since the law took effect. This data suggests that the restrictions on short-term rentals haven’t freed up a significant number of long-term rental units, as city officials hoped.
Airbnb further emphasizes the decline in available short-term rentals, citing a report by Airdna, a data analytics firm, which found an 83% plummet in Airbnb listings allowing stays of less than 30 nights since the law’s implementation. This significant reduction, according to Airbnb, has led to higher prices for travelers and fewer accommodation options for visitors.
Another critical issue raised by Airbnb is the rising cost of travel in New York City. Data from Co-Star, a real estate analytics firm, reveals that hotel rates in New York City increased by 7.4% year-over-year in July 2024, compared to a 2.1% increase across the rest of the United States. Airbnb argues that the reduction in short-term rental options has contributed to these higher hotel rates, making it more expensive for tourists to visit the city.
This rise in accommodation costs, Airbnb states, has a direct impact on tourism and local businesses. With fewer affordable lodging options, travelers may choose to avoid New York City entirely or spend less on other aspects of their trip, such as dining, shopping, and entertainment. Airbnb believes that rolling back certain aspects of Local Law LL18 could increase the supply of short-term rentals, providing more affordable accommodations for visitors and supporting the local tourism economy.
Airbnb’s request for New York City to reconsider its short-term rental regulations follows a series of legal and regulatory challenges between the company and the city. Last year, a New York judge dismissed a lawsuit filed by Airbnb challenging Local Law LL18, ruling that the law was within the city’s right to regulate short-term rentals to protect its housing market. Despite the dismissal of its lawsuit, Airbnb has continued to push back against the regulations, arguing they are too restrictive and fail to address the underlying issues of the housing crisis.
Airbnb has stated that it remains open to working with New York City officials to find a solution that both supports the city’s housing goals and allows short-term rentals to operate in a regulated manner. The company has previously proposed measures such as limiting the number of nights a unit can be rented on a short-term basis, but allowing more flexibility for hosts who are permanent residents of their properties. However, the New York City mayor’s office and the Office of Special Enforcement, responsible for enforcing the city’s short-term rental laws, have not yet responded to Airbnb’s recent request for reconsideration.
As the city continues to enforce Local Law LL18, it remains to be seen whether any changes will be made to the regulations in response to Airbnb’s concerns. The debate over short-term rentals in New York City highlights the broader challenges of balancing housing market regulation with the economic benefits of tourism. While city officials argue that Local Law LL18 is necessary to protect the housing market, Airbnb and its supporters contend that the law has unintended consequences, including higher travel costs and reduced economic activity from tourism. As Airbnb continues to advocate for changes to the law, the future of short-term rentals in New York City remains uncertain. What is clear, however, is that both the housing market and the tourism industry will continue to be affected by the city’s approach to regulating short-term accommodations.
