In a city like New York, where even the most profligate among us may shed a tear or two at hotel room prices, the homesharing trend has grown by leaps and bounds, with more co-op and condo owners than ever renting out their units to short-stay vacationers - and pocketing more than a few extra bucks in the process.
Led by Airbnb, homesharing has had a steady ascent over the last eight years or so since the company’s founders stumbled on the idea of renting out residential units in popular vacation destination cities to travelers in town both for business and recreation. As lucrative as the business can be for homeowners, it is also fraught with huge risks, including breaking proprietary leases, breaking state and city law and facing significant uncertainty with regard to issues of insurance and liability.
A Risky Money-Maker
“Airbnb is very much in play these days,” says attorney Robert Silversmith, a partner with the Silversmith & Associates Law Firm, PLLC based in Manhattan.
The popularity of joining Airbnb as a renter continues to climb despite the fact that it is illegal in the city of New York to rent out a home for less than 30 days—a measure designed to prevent unregulated, 'pop-up' hotels. In October 2014, the New York attorney general released a report saying that nearly three-quarters of all Airbnb rentals in New York City are illegal, according to The New York Times. The focus of the attorney general’s report, though, seemed to center on the idea of illegal hotels versus illegal rentals, perhaps an acknowledgment that some sort of acceptance of the occasional rental may one day come to fruition, something toward which Airbnb and its advocates are working.
For the most part, it seems that people have been willing to turn a blind eye to the illegality of renting through Airbnb, with enforcement only coming into play when a complaint is made to city officials or to a board or management of the condo or co-op. In a small building, for example, where the neighbors all know one another and a fair number are renting out to Airbnb visitors without incident, the practice could go on undisturbed for years.