Governor Cuomo Signs Bill to Fine Airbnb Advertisers

Governor Cuomo fired a shot over the bow to Airbnb and other online short-term rental sites by signing a bill on Oct. 21, 2016 that imposes high fines for advertising on those sites.

Housing law, ever since 2010, prohibited sublets of a unit in a residential building in New York City for less than 30 days. A later law, in 2011, sought to clarify that a sublet could be offered only by permanent residents, defined as those occupying premises for more than 30 days. Permanent residents could allow someone else to stay in their units for less than 30 days, without them being present, so long as no money was exchanged.

With the popularity of sites such as Airbnb and HomeAway, however, New Yorkers were finding it far too lucrative to abide by the law. The number of improperly sublet apartments surged, especially since the laws were spottily enforced, and usually only upon complaint. The result spawned an off-the-grid hotel industry that avoided taxes, leaving the neighborhoods with both the tax burden and unwanted transiency.

Cuomo’s bill — which can be read here — goes after the would-be subletters for advertising on these sites. The first violation is $1000, the second violation is $5,000 and the third violation is $7500.

Airbnb issued a statement saying that they filed a lawsuit on Oct 21st in the Federal District Court for the Southern District of New York. On Oct 24th, New York State representatives said they would not enforce the new advertising law until Airbnb’s lawsuit was resolved.