Detroit has outlawed Airbnb for R1 and R2 zoning
detroit.curbed.com
detroit.curbed.com
Hotels and some city people want to focus on the fact that there is unfair competition going on but also seem to recognize that the model is a threat to their bottom line. They seem to want defensive regulation to block all of it rather than just the part that is truly unfair to them some of which is fixed now that Airbnb collects and pays taxes. Not sure if they're at full parity with the hotels in terms of taxes and feels like they should be. Of course a city always has the option of removing these fees for everyone if they think it's unfair.
There's plenty of hypocrisy to go around here.
Not just "many". In New York specifically, it's literally over 50% that are illegal, by virtue of being whole-apartment rentals. Whole-apartment rentals of less than 30 days are not legal.
Ironically, many of the people that AirBNB used to use in their PR campaign as the faces of the "little guy" using AirBNB to "make their rent" were actually people who lived in rent-controlled apartments, which is (almost always) illegal in practice, even if the whole apartment is not being rented.
Airbnb wants the narrative to be that most of their business is regular people renting out a spare room to make some extra money. Certainly that's a component of their business and one I think, and think most people would agree should be encouraged.
Hotels and some city people want to focus on the fact that there is unfair competition going on but also seem to recognize that the model is a threat to their bottom line.
That makes it seem like a minor issue. AirBNB is facilitating this. AirBNB must allow the government to check up on local regulations. Limitations on how many days you can rent out your property and seeing how many properties each individual has is something only AirBNB has. It's further a very common thing related to their business. The main revenue source for AirBNB is exactly what governments (local city, etc) want data of.
AirBNB has often tried to block this, saying it's should be checked without any effort on their part. It took years of talks for AirBNB to cooperate in e.g. Amsterdam. Fortunately EU is now putting this all into law.
If AirBNB is allowing people to easily break local regulations and AirBNB is made aware of that fact they should follow the local regulations.
In most industries following local regulations is a common sense thing. There's also sometimes a personal effect of not following regulations. E.g. if someone on a vessel spills 1 liter of oil in the water that person can get a jail sentence for this. It doesn't matter if it was an accident or not.
Then for things like AirBNB, Uber, etc completely different rules apply. It makes no sense.
My hope would be that the company itself and/or its officials would be charged by some ambitious prosecutor for running a business that pretty openly encourages people to commit wire fraud. I have no idea how likely that is, but probably not very likely. American prosecutors don't have the appetite anymore to take on big companies.
First offense: $1000 | Second offense: $5000 | Third offense: $7500 and so on (daily).
Disclaimer: Invested in a startup that does AirBnB surveillance/reporting for jurisdictions.
It's not a criminal offense, so the punishment is a fine, not prison time.
But it's not just renting an AirBNB that's illegal in New York - listing a short-term, whole-apartment rental is illegal. (Short-term, whole-apartment rentals are not legal, and it's illegal to list an illegal rental).
For example, 18 U.S.C. § 1343 says:
Whoever, having devised or intending to devise any scheme or artifice to defraud, or for obtaining money or property by means of false or fraudulent pretenses, representations, or promises, transmits or causes to be transmitted by means of wire, radio, or television communication in interstate or foreign commerce, any writings, signs, signals, pictures, or sounds for the purpose of executing such scheme or artifice, shall be fined under this title or imprisoned not more than 20 years, or both. If the violation affects a financial institution, such person shall be fined not more than $1,000,000 or imprisoned not more than 30 years, or both.
Is a host that takes money for renting out an apartment, while knowing that such rental is in violation of the MDL, obtaining money under false pretenses?
AirBnB's terms of service, say:
7.2.3 You represent and warrant that any Listing you post and the booking of, or a Guest's stay at, an Accommodation will (i) not breach any agreements you have entered into with any third parties, such as homeowners association, condominium, or other agreements, and (ii) comply with all applicable laws (such as zoning laws), Tax requirements, and other rules and regulations (including having all required permits, licenses and registrations).
Well, you have a huge city with expensive hotels (the most expensive hotels in Vegas are sometimes cheaper than really average hotels in New York). So, the number of people willing to risk it to make a quick buck is not going to be small.
In addition, there is somewhat of a PR problem for NYC. Kicking people out of their apartments, especially in winter, makes for great outrage news stories--especially if you happen to evict some 82-year-old grandma in rent control who is using AirBnB to pay for her meds.
Better to simply notify the landlords, like San Francisco does, who are then incentivized to evict the scofflaws.
It's whole apartment rentals that are illegal. Where is grandma living while she is renting out her rent control apartment, that she pays $900/month for, on AirBnB for $300 a night? Maybe in her second, supposedly not primary, home in Florida?
In any event, I don't suggest they evict hosts. What I suggest is they go after AirBnB for continuing to accept blatantly illegal listings, like this one for example: https://www.airbnb.com/rooms/16148374
While section Section 230 of the CDA is an issue, the fact that AirBnB is taking money from the rental turns this into more than just a third party publisher of information. If Cy Vance wasn't too busy taking campaign donations to look the other way for powerful people, I'm sure he could direct his office to come up with something. Or Berman in SDNY could.
This restriction stops short term rentals in neighborhoods, leaving areas zoned as business (neighborhoods close to downtown and Woodward) free to host.
Airbnb for the rich only. Seems backwards.
In this case, they've probably thought about and decided that almost all potential visitors will still be able to afford one of Detroit's surprisingly cheap hotels, and that the rest may not actually be the crowd you want to attract, anyway.
Part of the appeal of AirBnB was to live like a local. But if all the neighbors are other tourists than what makes it any more unique than any other resort full of tourists?
You would be hard pressed to find any decent apartment within a mile of downtown for less than 1k/mo. Many nice apartments in downtown go for $2k - $3k. I personally would love to live downtown and many of my peers share the sentiment, there just needs to be a larger supply of apartments on the market.
Do I want to live four miles away from Detroit in a run down neighborhood? Not particularly- if I'm already getting into my car to drive to work, why not go a few more miles away into any one of the nice suburbs that surround Detroit?
It's hard to analyse such things without actual numbers. But it seems slightly icky to always go for the "Your're Detroit! You can't afford the luxury of zoning/safety regulations/firefighters/...".
Do you have a source for this?
And now apparently Fannie Mae is moving into this space: https://www.wsj.com/articles/gig-economy-grows-up-as-lenders...
Until it becomes the new normal, and market rents will factor that in. Then, people who, for whatever reason, cannot rent half their apartment out on AirBnB will just be priced out.
By who exactly?
Should the city have spent a few hundred thousand dollars on a PSA? People love calling those a 'waste of money.'