72% Of NYC Airbnb Are Illegal, Says Attorney General

Chris CrumBusiness

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New York Attorney General Eric Schneiderman released a report documenting what it says is "widespread illegality" across Airbnb's New York City listings. It says evidence indicates that nearly three quarters (72%) of listings in the city violate the law.

Of 35,354 private, short-term listings, 25,532 violated either New York State's Multiple Dwelling Law and/or New York City's Administrative Code (zoning laws), the report claims. Meanwhile, hosts generated roughly $304 million in revenue from these listings alone while Airbnb earned about $40 million.

The data used for the report was obtained by the Attorney General's Office after a May 2014 subpoena for information about potential illegal hotels using Airbnb.

The Attorney General and the City of New York have also announced a joint enforcement initiative against illegal hotels. They intend to investigate and shut down illegal hotels in the five boroughs.

"“This report raises serious concerns about the proliferation of illegal hotels and the impact of Airbnb and sites like it on the City of New York,” said Schneiderman. “We must ensure that, as online marketplaces revolutionize the way we live, laws designed to promote safety and quality-of-life are not forsaken under the pretext of innovation. The joint city and state enforcement initiative is aimed at aggressively tackling this growing problem, protecting the safety of tourists and safeguarding the quality-of-life of neighborhood residents.”

"Together, the Attorney General’s Internet and Taxpayer Protection Bureaus and the City’s Departments of Finance and Buildings along with the Office of Special Enforcement will investigate violations of building and safety codes, tax regulations and the executive law," the AG's Office said.

The report claims that commercial enterprises are using Airbnb to operate multimillion-dollar businesses. On such business made $6.8 million in less than five years.

It also says numerous units appear to have served as "illegal hostels," adding, "New York law prohibits commercial enterprises from operating hostels. In 2013, approximately 200 units were booked through Airbnb for more than 365 nights during the year, indicating that multiple, unrelated guests shared the same unit on the same night, as they would in a hostel. The 10 most-rented units were booked for an average of 1,900 nights in 2013, with one top listing average 13 reservations per unit per night."

You can find the report here.

New York appears to be taking the opposite approach to San Francisco, where legislation is underway that will actually help Airbnb.

Image via Airbnb

Chris Crum
Chris Crum has been a part of the WebProNews team and the iEntry Network of B2B Publications since 2003. Follow Chris on Twitter, on StumbleUpon, on Pinterest and/or on Google: +Chris Crum.