Airbnb NYC Rules And Regulations: What You Need To Know

It’s no secret that the demand for vacation rentals and other short-term rentals in New York City is sky-high. After all, NYC is one of the biggest tourist travel destinations in the world. Not only can NYC hotels be expensive, but availability may be limited—causing many travelers to turn to services like Airbnb to find rentals. Many travelers also feel as though an Airbnb (or similar) rental provides a more authentic experience than a hotel.

If you live in New York City, you may be toying around with the idea of becoming an Airbnb host yourself to take advantage of this high demand for rentals. Before you do, however, it’s important to not only weigh the pros and cons of Airbnb hosting but to be aware of NYC’s strict laws and regulations that are in place regarding these types of rentals. Doing so can help you make a more informed decision and potentially help you avoid costly penalties or fines down the road.

Benefits of Becoming an Airbnb Host

There are several benefits to consider when it comes to becoming an Airbnb host.

Bring in Additional Income

Perhaps the biggest draw of Airbnb hosting is that of bringing in additional income. By renting out extra space in your home, you can earn extra money that may help to offset your monthly rent or mortgage costs. This can be a great alternative to taking on a second job or picking up more hours at your current job.

Flexibility and Versatility

Being an Airbnb host also offers a great deal of flexibility and customization. For example, you can choose to only rent your place out during peak times of the year, such as the holiday season. On the other hand, you can offer rentals year-round if you wish. Airbnb also allows you the freedom to decide on your own rental rates.

Meet New People

If you enjoy meeting new people, then becoming an Airbnb host can be a great way to do this. Not only will you have the chance to host new guests in your home on a regular basis, but you can act as a “tour guide” of sorts by making recommendations around the city. A lot of Airbnb hosts find this to be a very rewarding experience.

Potential Drawbacks of Becoming an Airbnb Host

Of course, there are some possible drawbacks to consider when it comes to Airbnb hosting as well.

Income Can Be Unpredictable

If you’re looking for a side-gig where your income is predictable from one month (or even one week) to the next, this may not be the best option for you. Demand for rentals can fluctuate greatly, and so can your income from hosting an Airbnb.

Finding Renters Can Be Time Consuming

Communicating with renters and potential renters can be a time-consuming task. You’ll need to make yourself readily available to respond to questions and inquiries about your rental. Even once you’ve secured renters for a particular time frame, you’ll need to be in frequent contact with them to provide the information they need prior to their stay. During your guests’ stay, they may need to get ahold of you with additional questions or requests. Don’t forget to get renter’s insurance just in case!

Renters Aren’t Always the Best Guests

You’re taking on a bit of liability when you open up your home to “strangers,” even if they are paying for their stay. Not all guests are as clean and courteous as you may expect, so you may end up with some cleaning up to do after they leave.

Some Cities Have Strict Regulations on Rentals

In New York City particularly, becoming an Airbnb host can be complicated due to the many laws and regulations that are currently in place. Whether you live in an apartment, condominium, or single-family home, your ability to legally become an Airbnb host can be muddled by confusing laws—and failing to abide by these laws can result in hefty penalties and fines.

Understanding Hosted vs. Unhosted Rentals

If you’re thinking about becoming an Airbnb host in New York City, the first thing you’ll want to do is familiarize yourself with the city’s laws regarding such rentals, including the Multiple Dwelling Law (MDL). Please note that this section on hosted versus unhosted rentals applies specifically to those living in a multiple-dwelling unit, which is classified as a building with three or more separate rental units. Those considering renting out a single-family home on Airbnb in New York City should check out the section below labeled “What About Condominiums and Single-Family Homes?”

Hosted Airbnb Rentals in NYC

A hosted Airbnb rental refers to one where the owner of the unit is present during the time of the guest’s stay. If you’re renting out your condo on Airbnb, then this means you’ll be present for the entirety of your guest’s stay, acting as a host. These types of rentals in New York City are permitted for any duration of time, provided that the guest has complete access to all parts of the unit.

Unhosted Airbnb Rentals in NYC

The main issue with becoming an Airbnb host in New York City is complying with the state’s strict Multiple Dwelling Law (MDL), which prohibits unhosted rentals of less than 30 days in “Class A Dwellings” (buildings with three or more units). This means that if you want to rent out your apartment to bring in additional income while you’re away for the weekend, you actually cannot do this legally.

A Note on Rent-Stabilized Buildings

If you live in a rent-stabilized unit, such as a co-op, keep in mind that there may be additional restrictions on how much you can charge for an Airbnb rental. In general, those living in rent-stabilized buildings are discouraged from becoming Airbnb hosts because even in situations where laws are followed, many landlords frown on having these buildings used for Airbnb rental purposes. Even if your co-op doesn’t have specific rules against short-term leases and using your unit for Airbnb hosting, you might still ruffle feathers with your landlord and other tenants who grow tired of seeing non-residents coming in and out of the building.

Furthermore, in a rent-stabilized building, you cannot legally make a profit on an Airbnb rental. In most cases, you’d probably have an easier time simply finding somebody to move in on a longer-term basis and take over half of the rent.

What About Condominiums and Single-Family Homes?

If you own a condominium and are thinking about renting it out as an Airbnb, remember that state laws take precedent. If your condo is located inside a Class A Dwelling, you will still be prohibited to conduct any unhosted rentals for less than 30 days. In addition to this, your condominium’s HOA may have specific bylaws in place that make it difficult to become an Airbnb host. For example, some may have minimum/maximum lease terms or even explicitly prohibit the use of units for vacation rentals.

If you have a single-family home in New York City, you won’t be affected by the state’s Multiple Dwelling Law. However, you may still be subjected to zoning restrictions that can complicate your plans to be an Airbnb host. For example, your home may need to meet specific building codes to meet the legal requirements of a “rooming house.” The best way to find out what type of zoning restrictions are in place for your property is to look up your Certificate of Occupancy. There’s a chance that you may need to obtain a certificate in order to have your zoning amended, and inspections may need to be performed on your home in order to do this.

Keep in mind, too, that renting out your home on Airbnb or a similar platform could also subject you to additional taxes, which could eat into your profits.

What’s the Reasoning for These Restrictions, Anyway?

As you can see, there are numerous restrictions and laws in place that can make it difficult to become an Airbnb host in New York City. However, these restrictions are in place for a reason. For starters, Airbnb was originally started to be used as a home-sharing service; it was not intended to become an income platform for commercial investors. Over the years, however, more commercial investors have been getting involved in the Airbnb market, which many New Yorkers claim has had a significant impact on neighborhoods by increasing prices and driving gentrification.

On the other hand, Airbnb claims that these services are actually helping the NYC economy by allowing residents to bring in more income and preventing hotel prices from surging. Regardless of what you believe to be the case, everybody in New York City is subject to the same laws and restrictions and can face serious fines by disregarding them.

Potential Fines and Penalties for Illegal Renting in NYC

Specific fines and penalties for illegally renting out a dwelling can vary greatly in New York City. For example, violations of the MDL can easily result in fines of up to $2,500 per day. In New York City, it is also against the law to even advertise illegal rentals as of October 2016. If you’re caught advertising an illegal rental, you can expect to face fines ranging from $1,000 to $7,500 (depending on how many violations you’ve had). Airbnb can also be charged these fines for allowing your advertisement on their platform.

Fines can be hefty, but the good news is that as long as you’re staying up-to-date on city laws and regulations regarding Airbnb and similar rentals, you shouldn’t have anything to worry about.

Making the Most of Your NYC Airbnb Rental

If you’ve decided to become an Airbnb host in New York City, there are a few tips worth keeping in mind that can help you make the most of the experience.

Stay on Top of Changing Laws

First and foremost, stay up-to-date on new laws and changes to existing laws. For example, the city is currently trying to pass a law that would require Airbnb hosts to list their active rental addresses on the platform. The idea here is that this would prevent commercial investors from using the platform for profits. Airbnb is fighting this law as a violation of free speech, but you’ll want to stay on top of this and other proposed laws that could affect you so you don’t commit any violations as an Airbnb host.

Hire a Professional Cleaning Company

Keeping your rental clean is one of the best ways to ensure great guest reviews, which can, in turn, make it easier to find new renters and drive up your income. If you haven’t done so already, consider working with a local cleaning company to help you keep your place in tip-top shape. Maid Sailors is happy to offer a number of cleaning lady services to suit your needs in New York City and the surrounding areas.

Have a Plan For Maintenance Issues

In addition to having a cleaning company you can trust, it’s also wise to have an experienced contractor or handyman on-call so you can address any maintenance issues quickly during your guest’s stay. For example, if a pipe springs a leak while you have guests, you’ll want to be able to have this taken care of quickly and affordable.

Know How Much to Charge

Airbnb allows you to charge as much or as little as you’d like for your rental, but there are some important factors worth taking into consideration when it comes to pricing your property. A good place to start would be to look up current prices for similar rentals in your are and try to price yours competitively. When deciding on a price, be sure to also factor in things like cleaning fees to maximize your profits.

Make Sure Your House Rules Are Clear

Avoid issues with your guests by writing out a specific set of “house rules” that are clear. This should include policies on things like pets, children, noise/quiet hours, and similar items. Make sure your guests are issues a copy of these house rules prior to their stay so they can review them and address any questions or issues with you prior to their check-in.

Overall, becoming an Airbnb host in New York City will require some specific knowledge of the state and city’s laws regarding the renting out of dwellings. As long as you understand and abide by these laws (as well as any rules set forth by your HOA or landlord), you should be in good shape. From there, you can begin enjoying all the perks of being an Airbnb host in the Big Apple!