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New York City Taking First Steps Against Air BnB Members

New York City Taking First Steps Against Air BnB Members

Old Apr 23rd, 2014, 03:43 AM
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New York City Taking First Steps Against Air BnB Members

Just saw on the news that the city attorney has obtained a subpoena against Air BnB requiring them to provide the names and addresses of all residents/landlords in New York City who are offering to rent their apartments through the service, with the goal of stopping rental and returning these residences (believed to be in the thousands) to the supply available for locals renting long term.

In a press conference several important officials including an influential congressman and the Manhattan Borough President cited the increasing number of complaints from legitimate local residents and concerns that Air BnB is taking out of circulation thousands of apartments that should be available for long-term rent by locals (a city policy aimed at keeping middle and working class people in the city with strict rent regulations).

An Air BnB spokesperson say the subpoena is too broad but it is not clear if they will elect to comply or to fight it in court (possibly increasing the chances of similar legal action in other places).

See how well Air BnB's "negotiations on the city laws" are going?

So for any tourists seeking to rent an apartment in Manhattan - watch the progress of this situation. The results and timing are unsure - but obviously the city's goal is to scare the apartment owners/residents out of participation with the threat of large fines - rather than actually having to prosecute all of them. But it appears they are ready to start broad-based prosecutions from the offering end rather than just responding to individual situations based on actual tenant complaints.
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Old Apr 23rd, 2014, 10:42 AM
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Well, I guess the hookers are going to have to go back to the hotels.
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Old Apr 23rd, 2014, 12:25 PM
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How do they figure that Air BnB is taking anything "out of circulation?" I would think it is the owners/occupants who are doing that.
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Old Apr 23rd, 2014, 12:58 PM
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This service is the most obvious supporting people that are subletting illegally and the number of complaints has skyrocketed - as apparently the number of transactions through Air BnB.

And I said "members" meaning the tenants and landlords that are doing the cheating. The city is just asking Air BnB for all of their names and addresses so they can be prosecuted.
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Old Apr 23rd, 2014, 01:45 PM
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>

Unless there are credible allegations that people are buying NYC apartments to rent them illegally under airbnb schemes (and there are not), then no one is taking them out of circulation. That whole concept is nonsense. The supply of "affordable" housing in NYC is designed to be kept low because rent restriction schemes and rent control both repress supply, but anyone who has taken an introductory econ class knows that.
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Old Apr 23rd, 2014, 04:09 PM
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There are two problems.

One is landlords wanting more than the rent regulations allow them to charge for a monthly rental - so when the apartment becomes vacant they put it up for daily or weekly rental. Not just illegal but unfair, since many of these apartments were built or rebuilt with tax concessions from the city on the basis that the apartments would remain rent stabilized.

The other problem is a tenant with a rent stabilized apartment who moves out of the city but keeps the apartment at a rent stabilized rate (not allowed) and then renting it out for a profit at a nightly or weekly rate.

Both of these are pulling apartments from the legitimate local long-term rental market. And both should be found and forced to rent the apartment long-term (landlord) or give it up (absent tenant).

As for y our theory about keeping the supply of apartments low - then why is the city offering such generous tax benefits to landlords building or rehabbing middle or working class housing.

There is a reason "landlord" is a dirty word in NYC.
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Old Apr 23rd, 2014, 04:16 PM
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It's like "developer" in Nantucket.
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Old Apr 23rd, 2014, 04:44 PM
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Why is there always so much haranguing here about this subject?
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Old Apr 24th, 2014, 04:34 AM
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The supply of "affordable" housing in NYC is designed to be kept low because rent restriction schemes and rent control both repress supply, but anyone who has taken an introductory econ class knows that.

A huge +1.

I can't think of a more obvious and disingenuous ploy to pander to voters than cracking down on a non-existent problem like AirBnB. The limited supply and high prices of Manhattan real estate have absolutely nothing to do with rental availability or prices.

then why is the city offering such generous tax benefits to landlords building or rehabbing middle or working class housing.

Because the rent controls and zoning restrictions have had such a negative impact on supply and prices and this is their ham-handed way to "combat" the problem without upsetting the vested interests they have created via policy.

Why is there always so much haranguing here about this subject?

Because nytraveler wants to pretend she cares about the common man.
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Old Apr 24th, 2014, 07:01 AM
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Sorry - but NYC has had rent control since WW II due at that time to a severe housing shortage and the attempts by landlords to profiteer by raising rents by huge amounts. In 1969, I believe, it was changed to rent stabilization (for modest apartments, less than $2k per month) landlords rent increases are mandated by law based on the number of years of the lease, assuming that they choose to accept tax reductions from the city. If they don't take these tax reductions, or if the apartment rises above $2K per month, they are free to charge what the market will bear.

Landlords typically flout these laws (I had to take one to court since he refused to charge me the legal rent - and ended up with 7 months living there rent free).

All along this has been an attempt to encourage landlords to build affordable housing in the city - rather than just luxury highrises that the average person can't afford to live in.

And for the information of everyone here we live in a middle class co-op - 6 story redbrick with no doorman or concierge or gym or foofy anything - except the usual benefits of a prewar building (large rooms, lots of closets, high ceilings, crown molding and original - from 1925 - parquet floors).

And we are the common man. Not the poor man - but the common one - and do care about others in the community and making sure there is as much affordable housing as possible for local residents - and not illegal profits for landlords and absentee renters. If one wants to build a hotel one is perfectly free to do so. Or luxury housing. But not to take city tax abatements designed to provide housing to the average person and then flout the law to obtain excessive and illegal profits.

I understand that most places don;t have these laws. And some people might not understand them. But this is how it's supposed to work. And I'm in favor of whatever the city can do to bring these apartments back into the long-term rental market.
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Old Apr 24th, 2014, 07:15 AM
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I understand that most places don;t have these laws.

Most places behave rationally in this instance.

And some people might not understand them.

Including yourself.

All along this has been an attempt to encourage landlords to build affordable housing in the city - rather than just luxury highrises that the average person can't afford to live in.

It does nothing of the sort. It may have been an "attempt", but it failed miserably and only the willfully blind would support its continued existence.

But this is how it's supposed to work.

Well over 90% of economists would tell you that rent control reduces the quality and quantity of housing. Most also agree that it disproportionately benefits the well-off and hurts the poor.

If NYC wants more supply, they need to get rid of rent control.

And I'm in favor of whatever the city can do to bring these apartments back into the long-term rental market.

In favor of everything except the most efficient and realistic solution.

If the concern is with retaining affordable housing for the poor (I don't think it is), then it would be far preferable to allow rents to fluctuate freely and offer cash subsidies to low-income households.
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Old Apr 24th, 2014, 11:12 AM
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>

Yeah, that's ridiculous both in concept and that you have bought into the spiel. The fact is that price controls limit supply. It is simple fact, from Soviet Russia to Venezuela to the early 1970s in the US and the 1980s in the UK. And then the economies of the US and UK grew exponentially when the controls were lifted. Meanwhile, in NYC, affordable housing stocks are held by the paradigm millionaire in rent controlled housing.

https://www.baycitizen.org/columns/s...es-super-rich/

http://furmancenter.org/files/public...et_FINAL_4.pdf
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Old Apr 24th, 2014, 12:08 PM
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NYT: For the record, for a NYC rent stabilized apt to be deregulated, the monthly rent has to rise above $2500

AND

the tenants have to be making a combined annual income of more than $200k for the past two years.
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Old Apr 24th, 2014, 01:25 PM
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I do not claim to be an expert on the latest terms for stabilized apartments - since it has been almost 20 years since I rented.

But - there are numerous different views of how an economy works. And allowing landlords to charge whatever they please for apartments in Manhattan (for which they have accepted city tax abatements to stabilize the rents) would result in the remaining middle class (not poor, since there are numerous city-subsidized low-income city housing projects in Manhattan) being driven out of the City and into far suburbs.

This is against the policy of the government - which has a perfectly legitimate interest in allowing middle class people to continue to live in Manhattan.

Please explain to me exactly how allowing landlords to charge whatever they want for their apartments (after they have repaid the tax abatements they accepted from the city) will bring more affordable apartments onto the market - as opposed to more extremely expensive luxury housing. Some people don;t seem to understand that in NY there is a huge artificial market for high priced housing (from people associated with UN embassies, from consulates, from huge corporations and by the uber wealthy from around the world who have been snapping up high end property ever since the dollar sank versus the euro and the pound.)

Please explain to me exactly why removing stabilization would cause landlords to build new affordable housing in Manhattan. (We can already see that they are willing to flout the laws for higher profits. How is a middle class couple supposed to pay $4500 per month for a small one bedroom? And when they can't afford that - where are they supposed to move to?)

I think the misundertanding here is that this law is not just economic policy - it is also social policy. (Yes, in New York we have social policies.) We have goals for the city that are not aimed just at making money.

Even our Republicans. Michel Bloomberg has just spent $50 million of his own money to fund efforts to loosen the NRA's stranglehold on Congress and state legislatures - and finally succeed in passing some rational gun control laws.

And it's not going to make him any money. Just save lives.
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Old Apr 24th, 2014, 02:27 PM
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No, the law is PRIMARILY social policy. But who is going to fund the utopia the law endeavors (and fails) to design - the government? No, that would mean even more taxes in the most-taxed city in the country. Then that cost must be passed along, and it's passed along to the people who can "afford" apartments in NYC that are not effectively subsidized through legal machinations.

>

That artificial market is created by NYC's own laws, which create a disparity. First, NY makes being a landlord a crap business unless you have high-rent tenants who pay, and actually pay, above-market prices. It's nigh impossible to boot a tenant in NYC unless the tenant is caught in the Edwin Edwards conundrum of being found in bed with a dead girl or a live boy (or the inverse: a live girl or a dead boy).

Second, in NYC there is no true free market, there are the stabilized apartments that are sub-market (well over 50% of NYC stock), the rent control that are sub-sub-sub-sub-submarket (only about 2%), and the uncontrolled/unstabilized apartments, which are far more expensive than they would be but for the rent stabilization and rent control policies. Again, this is basic economics. To be able to afford to provide rent stabilized and RC apartments, the landlord must recoup its lost money from someone else, thus the new lawyers and b-schoolers and doctors with 120K+ in debt who move into NYC now with 250K/year income (which gets whacked by NYC taxes) are subsidizing folks who have rented for years at stabilization rates and saved a boatload. In another area of the economy, this is Social Security.

You also do not understand that merely removing rent stabilization will not cause more rent stock to be constructed. That's just one aspect of NYC's perverse rental market. In addition, there are restrictive zoning provisions, building requirements (e.g., parking requirements in buildings above 96th street but not below), and the aforementioned no-booting-the-tenants lean in NY landlord-tenant law that makes property owners a suspect class (which is Leninist), as shown by your own posts.

As for the Second Amendment issues, that's just daft. NYC gun control laws didn't make the city safe - it had the same restrictive gun control laws in the 1980s when the murder rate was 5x higher or more. Look at Detroit and Chicago and Camden, each of which has stricter gun control laws than Dallas or Nashville, and a TON more crime. Ray Kelly, Bill Bratton, Howard Safir, Rudy Giuliani and good police work made the City safe. Bloomberg's anti-gun crusade did not and will not.
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Old Apr 24th, 2014, 02:32 PM
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But - there are numerous different views of how an economy works.

Not really. There is near-unanimity that rent control is stupid.
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Old Apr 24th, 2014, 03:51 PM
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But the alternative to rent control has not been found. No one seems to explain why the free market will provide affordable housing that it was not providing before rent control and rent stabilization were instituted. Did the landlords acquire a social conscience in the meantime?
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Old Apr 24th, 2014, 06:40 PM
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But the alternative to rent control has not been found.

Give subsidies to the poor. Much simpler and it actually helps the poor. Rent control doesn't.

No one seems to explain why the free market will provide affordable housing that it was not providing before rent control and rent stabilization were instituted.

Because it will increase investment in rental housing (assuming that other restrictions, such as zoning, allow it) depressing prices generally.

Did the landlords acquire a social conscience in the meantime?

I was unaware that all landlords were ogres.

The people that like rent control are middle to upper income white people with good credit. They pretend to give a toss about poor people because they think it makes them look better (it doesn't - it makes them look disingenuous). If they actually cared, they'd bother to think about the issue and would realize how disastrous rent control is. It doesn't work in theory and it doesn't work in practice.
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Old Apr 24th, 2014, 09:09 PM
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Because it will increase investment in rental housing (assuming that other restrictions, such as zoning, allow it) depressing prices generally.

So why did that not solve the problem before rent control were instituted?
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Old Apr 25th, 2014, 02:38 AM
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So why did that not solve the problem before rent control were instituted?

It actually largely did and the proportion of housing in Manhattan that is rented has plummeted since rent control was instituted. What has been built since has been luxury units, and there has been a statistically significant increase in dilapidation for affordable housing.

The problem at the time it was instituted was a short-term spike in demand. New housing stock isn't built overnight. Had NY left well enough alone and ended rent control after the immediate crisis ended, we'd be better off and Manhattan wouldn't be populated by so many yuppies.

Ask yourself this. Why has all the major development in places like Williamsburg been at the high end and why has so much of it been condos?
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