By Taylor Hill
Since the end of October, Airbnb has been trying to resolve a piece of legislation that could significantly impact their operations in New York. Airbnb filed a lawsuit in the Manhattan federal court system saying that a particular piece of legislation that imposes fines on advertising short-term home rentals is ambiguous and could lead to overreaching into online platforms.
New York’s Governor Andrew Cuomo signed into law legislation that would allow fines, and penalties up to $7,500 on host markets that advertise illegal short-term rentals. It stands that a company such as Airbnb would be concerned about such legislation.
Airbnb is an online market place that allows people to list rental properties or short term living accommodations online with the cost that have been set by the property owners. The company has been trying to resolve this conflict with New York State legislators, saying that the wording of this particular law may allow civil penalties and criminal liability to third party listing companies such as Airbnb.
They believes that, as a third party listing company, they should not be held responsible for housing conditions or how landlords use the company’s website. Many cases sprung up between online housing markets and local public officials.
This legislation poses a threat to Airbnb’s business structure, as well as other companies like it. Airbnb continues to resolve these conflicts in New York and has started taking proactive steps to make sure this doesn’t happen in any of their market areas.
Unfortunately, this lawsuit does not seek protect the people who use services such as Airbnb, only the listing companies themselves.
“We are a country that grew because of the homeowners ability to quarter people,” said Tony D’Orazio, the Libertarian candidate for the 25th New York Congressional District. “It was so important that it was included in the original Bill of Rights. For a state to infringe on someone’s ability to quarter others at their discretion is ridiculous.”
The push to target services such as Airbnb comes from legislators concerned they aren’t receiving taxes traditionally levied on hotels and the hotel industry concerned that their prices are undercut by short-term rentals. Short-term listing rates are almost always significantly cheaper than traditional lodging, with estimates showing that Airbnb is often 21.2% – 49.5% cheaper than hotels. The median rate for hotel lodging in New York City is $245, while the cost for a full apartment is only $180.
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