New York Attorney General: Nearly 3 Out Of 4 NYC Airbnb Rentals Are Illegal

Brian Chesky Illustration Airbnb logoMike Nudelman/Business InsiderAirbnb’s founder Brian Chesky.

Almost three-quarters of Airbnb rentals in New York City are in direct violation of zoning regulations and other laws, according to New York Attorney General Eric T. Schneiderman.

Schneiderman released a report Thursday called “Airbnb in the city.” In it, he concluded that 72%, or more than 25,00, of short-term rentals through Airbnb seem to violate New York laws.

The report also says hosts netted about $US304 million from illegal Airbnb listings, and that Airbnb made $US40 million from them. Around 6% of Airbnb hosts in New York City accounted for a disproportionate share of of revenue: 37%, or $US168 million. Schneiderman also concluded that New York City was likely owed $US33 million in unpaid hotel taxes from illegal short-term rentals.

The report is a result of the attorney general’s subpoena in May. Airbnb, which initially fought the subpoena, anonymized and submitted its data. It’s based on 497,322 private stays in homes, apartments, or private rooms in 35,354 places in New York City between January 1, 2010, and June 2, 2014.

Most of the reservations came from Manhattan and Brooklyn; reservations in Queens, the Bronx, and Staten Island accounted for only 3%, or $US12 million in revenue.

Additionally, the report says that thousands of Airbnb rentals in New York are illegally being used as long-term sublets. “In 2013, more than 4,600 units were booked as short-term rentals through Airbnb for three months of the year or more,” the report says. “Of these, nearly 2,000 units were booked as short-term rentals for a cumulative total of half the year or more — rendering them largely unavailable for use by long-term residents.”

The report also found that many listings were actually illegally operating hotels. “In 2013, approximately 200 units in New York City were booked as private short-term rentals for more than 365 nights during the year. This indicates that multiple [guests] shared the same unit on the same night, as they would in an illegal hostel,” according to the report. “The 10 most-rented units were booked for an average of 1,900 nights in 2013, with the top listing accepting 13 reservations on an average night.”

Nick Papas, a spokesperson for Airbnb, sent the following statement to Business Insider:

“We’re proud that Airbnb has helped countless families pay their bills and stay in their homes.

Now, we need to move forward. We should not deny thousands of New Yorkers the chance to share their homes, pay their bills and stay in the city they love. We need to work together on some sensible rules that stop bad actors and protect regular people who simply want to share the home in which they live. We look forward to working with everyone in New York in the weeks ahead.

The report’s conclusions rely on incomplete and outdated information. For example, the findings do not account for the more than 2,000 listings we have already removed from our community in New York. Additionally, every single home, apartment, co-op and living space in New York is subject to a myriad of rules, so it’s impossible to make this kind of blanket statement. That kind of uncertainty and lack of clarity is exactly why we’re advocating for clear, fair rules for home sharing.”

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