Again and again, people who use Airbnb to 'hack' the rental market get little sympathy from me when the chickens come to roost. If your landlord was interested in running a tenement home/boarding house/hotel, they wouldn't sign you into a year-long lease. Also, and I know this has been hashed out before on these comment threads but he's grossing $30k a year on the back of his landlord. The landlord has every right to be upset and take action.
The author of the post seems shocked that he's in violation of anything. Perhaps he'd like to share excerpts of his lease before he feigns such shock.
Come on, the guy lives alone in a 3+ bedroom apartment in Brooklyn. We all know he signed that lease specifically to run a pseudo-hotel business under the guise of an Airbnb profile. He whines that he can't afford to live in the New York rental market without roommates; so get roommates or move somewhere cheaper.
BTW, the author is a professional writer who (gasp!) has a brand new startup to plug.
edit: It sounds like this guy has a sincere love for the experiences and newfound social life he's found when acting as an ambassador for his city. His heart is in the right place. He would make a great Couchsurfing host and probably make even greater, long-lasting relationships.
"Come on, the guy lives alone in a 3+ bedroom apartment in Brooklyn. We all know he signed that lease specifically to run a pseudo-hotel business under the guise of an Airbnb profile."
Categorically not true. Chris is a good friend, and he had a long term roommate until recently. He took on the lease because he knew they could cover rent whether or not the third room got let out. It is an amazing apartment in an awesome building, and his involvement in airbnb is not cynical or presumptuous. His listing was great value and he is an excellent host. I met him through airbnb and am incredibly grateful for it. So, try not to presume.
The only part of your comment that is germane to the GP is that before his roommate left they could cover the rent without renting the third room. "Chris being a good friend" and "His listing was great value" are irrelevant.
Thanks, I really appreciate the context; didn't expect it. Though he still has other options... like approaching his roommate about the financial hardship suddenly imposed upon him, leveling with his landlord to get out of the lease, or finding a new (real) roommate.
The NYC rental market is brutal, getting out of a lease is rarely the best option. If you're lucky enough to find an affordable spot in a good neighborhood with decent space, you hold onto it with white knuckles.
Actually, the general tone seems to be exceptionally meek: he does say he was surprised, but I got the impression that he thinks he shouldn't be surprised. It reads much more like a "look what an idiot I was, and please don't repeat my mistakes" story than "oh woe is me".
There's a lot of people trying to rent out rooms on AirBnB now, and many of them think it's a "small issue," as likely to be ignored as, say, hosting a close friend for a month or two while they're looking for a flat after an explosive breakup. But it appears that a typical landlord disagrees with that opinion, and some shout-outs to that effect might be really helpful.
It's definitely an interesting story. The author was offering a personal experience that was enjoyable for both the guest and the host. As he said, his guests and he often established a unique connection. On the other hand:
"When I delivered my rent at the beginning of the next month, I found the management company’s office under construction. It's now a hotel. The “loft-style” rooms are now listed on Airbnb for $169 a night."
Is this how airbnb was intended to be used? Isn't the point of a bed and breakfast-style experience the small-scale feel that the author described? Are guests really going to get the same attention/enjoyment out of airbnb if it's more-or-less a run of the mill hotel experience? Also, aren't there different regulations in place for rentals vs. hotels? The property manager may be violating laws as well.
I know you're skeptical they'll ever get hotels, but there's a continuum between private sofas and hotel rooms, and they just moved one step further along it.
[link to an airbnb user]
This is after only a few months. I bet you they will get hotels eventually. It will start with small ones. Just wait till all the 10-room pensiones in Rome discover this site. And once it spreads to hotels, where is the point (in size of chain) at which it stops? Once something becomes a big marketplace, you ignore it at your peril.
There are lots of hotels listing on airbnb. And yes, some look like they were intended to be apartments.
NYC hotel laws are strict. Its very possible what the landlord is doing is illegal. If the OP was staying in his room, may be it qualified as a bed & breakfast. I don't think the landlord would meet that qualification.
In an efficient market, every niche will be filled. Resistance is futile. If there is money to be made, landlords will flock to it. The laws will change or be ignored.
It may well not be how AirBnB was intended to be used, but it definitely is. When I took a trip to London recently I rented an "apartment" (A room with a kitchen in it) from a guy on AirBnB that had at least seven rooms listed on the site.
When I wrote this I wasn't looking for sympathy. Most hosts probably have nothing to worry about. What's interesting is that my landlord became my Airbnb rival. The internet's magic is enabling disintermediation -- as the tenant, I was the middleman, and my lease gave him a way to cut me out.
I'd concur with the folks who say that 'shocked' is over-reaching. More like surprised the owner went straight for a restraining order rather than having a chat with him at their next meeting. If I were this guy's landlord I'd probably talk first, sue later. But that's just me. It is an interesting (and good) counter story to the one of an owner having their house trashed.
That the market is expanding is not surprising. There are a lot of empty bedrooms around. We've yet to see someone doing this with their foreclosed property but I'm sure that will happen too. Like Ebay, AirBnB seems to have a 'let the user do what they will and let whomever thinks they are harmed go after them.' A good example of this was the way software companies responded to people selling old copies of software on eBay or enterprise gear that normally requires a service contract. It may start a sort of 'race to the bottom' for some folks, we'll have to wait and see.
As landlords, we obviously have language prohibiting these sorts of actions on the parts of our tenants. But that isn't just because of our own greed. Tenement homes/boarding houses get worn down quite a bit faster than rentals. It's easy to end up with the property completely trashed, it's easier to get sued or otherwise in trouble, and it's easy to end up with neighbors complaining and disliking you.
In addition to all of that, often codes simply don't allow boarding houses, regardless of who is running them. One of our renters tried to run a boarding house without our knowledge, and when the police were called to one of their parties, the city threatened to levy considerable fines against us for running a boarding house, regardless of whether we were actually running it or getting any money from the tenants.
"If your landlord was interested in running a tenement home/boarding house/hotel" - then he would have to staff it himself too, promote it and take the risk of no bookings. With a tenant he has someone making sure the place is looked after + he has a contracted income for the whole 12 months.
By the sound of this place, the landlord could probably do quite well out of airbnb. But in that case, why not just approach the guy and cut a deal or explain that he wants him out to rent the place himself?
Yes, though if the landlord had a hand in the operation I'd imagine it would have to be a legal business. This means taxes, insurance, wages, administration costs, permits that probably make it more trouble than its worth.
Let's take a moment and see the amazing things that can be accomplished with AirBnB and marvel at the things that we do to ourselves with regulation which could make things like this practically impossible. Stifling business and innovation, deadweight losses to society, and all that economics jazz. Great for the traditional hotel industry, though, and whatever lobbyists they have at City Hall and in Albany...
Yeah, it's amazing how one can make a lot more money by violating health and safety regulations. Upton Sinclair did a great piece about how amazing it is.
Your comment is incredibly relevant and insightful because the world is black and white and our current regime, which is perfect, is all that stands between us and _The Jungle_. So-called "sensible" reforms to hotel-related legislation and economic freedom in general will only doom us all to accidental cannibalism in our hamburgers.
Seriously, this is flippin' AirBnB, not the slaughterhouse industry. I only asked you to think about the costs, not to roll everything back. Is this a knee-jerk reaction to straw-man arguments which you happen to imagine coming from your least-favorite Republicans, or what?
True, its easy to go this grasp for this argument in the abstract. Hell, maybe the way they do things in NY is corrupt. But in reality you're grossly oversimplifying a century of progress in public policy.
Labor laws protect the needy and powerless, taxes pay for schools and city services, permits keep us safe and hold businesses accountable if they fuck customers over or violate things like heath codes...
The problem is that it's hard to tell when value arises from the elimination of a deadweight loss and when it arises from externalization of costs. E.g. environmental regulation generates some deadweight loss in the form of compliance, etc. It also seeks to internalize inherent costs of activity that would otherwise be externalized. If we got rid of the regulation, a factory owner would see a small amount of benefit from the elimination of the deadweight loss, and a very large amount of benefit from being able to externalize the inherent environmental costs of operating a factory on the local community.
In the situation of AirBnB, the externalities are imposed on all the other residents of the building and the neighborhood who signed up for apartment leases on the assumption that random people would not be coming and going. The value that accrues to the AirBnB host is generated partially by the loss of value to his neighbors. So what you have is not a creation of value, but rather the opportunistic transfer of value.
Negative externalities are best handled by tort law. Let case law develop over time. Central planning (i.e. one law with 'good intentions') does not work.
Tort law works okay when the number of interacts are limited, but it falls down when you're talking about large numbers of people interacting. Ronald Coase, who is deified in modern conservative economics circles, said as much in his seminal 1960 paper on the FCC.
So I can sue smokers for polluting my air as I walk past them? How about my neighbors who play loud music at 4am? Oh, and that guy who urinated on the plants outside my apartment?
Hmmm. I'm not sure that it's so easy for courts to take on all these cases. I'm especially worried that it's too much burden on individuals to defend their rights. Maybe we should try to find a consensus on what's OK and have the police hand out tickets?
Okay, I don't want to drag HN into flamewars for the lulz, so... Man, all you guys, chill. I'm not saying let's all go anarchist hyper-libertarian on you, or say that no regulation has any purpose or any benefit. I'm just asking you to think about the costs we impose on ourselves with it - I think this is reasonable, because you're clearly doing a perfectly good job thinking of alllll the benefits already, as your responses have clearly indicated.
And this is a specific occasion to see the costs. Most occasions you won't get to see the costs. They'll be behind the veil of obscurity and all you'll actually see is a bunch of (possibly self-interested) Republicans talking about abstractions, if the costs are mentioned at all.
Perhaps now that we are better enabled by technology we can get all or substantially all of the benefits with fewer costs in the future? Then everyone can be happy happy freedom joy double rainbow all across the sky puppy-kisses. For srsly. :)
Yeah, but what are the "costs" when AirBnB "moves in?" Expectations of residential building/neighborhood such as certain amount of traffic and noise, as well as neighbors who are relatively long term (in other words, you can get to know them--example may not apply in some cities).
Face it, AirBnB is just the next hiding place for illegal rentals after tax and zoning officials caught on to vrbo. I don't understand how so many people think that they can turn the property under their control (owned or rented) into a business without liability or regulation. Just write the word taxi on your car, pick up some fares, and see what happens.
Exactly. This restraining order was the first I had heard from my landlord that he didn't want us airbnb'ing. A phone call and I would have stopped. I knew it was too good to be true.
Attached to the order was a complete printout of my Airbnb listing and all my reviews, included as evidence I had violated clauses in my lease. (Some leases, I have since learned, have evolved specific language prohibiting tenants from listing their pads on vacation-rental sites such as Airbnb.)
I don't buy your innocence here. I've been leasing houses for ~10 years now during and after college. The leases have always required a mix of landlord approval for subletting, banned running a business from the house, and prohibited occupation by non-lessees.
Here are two clauses from an older lease[1] I happen to have in my desk:
* Tenant shall not assign this Agreement, or sub-let or grant any license to use the Premises or any part thereof without prior written consent of Landlord.
* The premises shall be used and occupied by Tenant and Tenant's immediate family... exclusively, as a private single family dwelling.
Your faux innocence is pretty annoying actually. You were abusing the property for commercial purposes and you're surprised he didn't give you a friendly phone call?
1 Looks like the lease was originally snatched from www.academichomes.com/downloads/ExampleLeaseAgreement2.doc
I actually find your belligerent attitude annoying. Is that helpful to note?
OP would be 'abusing' the property if he were running a crack den. I see no problem with tenants doing whatever they want with the property that they are leasing - as long as no damage is done & neighbors are not troubled.
> I see no problem with tenants doing whatever they want with the property that they are leasing - as long as no damage is done & neighbors are not troubled.
That's why landlords define "damage [being] done" and "neighbors [being] troubled" in a legally binding contract called a lease, and when you break that contract, you can get evicted.
I strongly suspect most resistance to these basic facts in this thread is typical Airbnb/pg/HN apologia. It certainly isn't coming from anyone who has rented in NYC, that's for sure.
I don't find it that hard to believe that someone would blindly sign a lease after only quickly skimming over the important bits and then never look at it again. I remember one landlord looking quite surprised when I sat in his office and read all 8 pages of the contract, asked for clarifications on a couple of points and asked for one clause to be changed. It seemed to me that she'd never seen anybody do that before.
As a landlord my lease agreement is only 3 pages, and I have always reviewed it with tenants before I allow them to sign it. I review every clause with them and have them initial every page. If they have questions or objections we sometimes modify clauses; we cross out the standard language and write in the new agreement and we both initial the change. It only takes a few extra minutes to review the entire agreement, and I wouldn't want a tenant to sign something that I know they haven't read.
When said person is occasionally and randomly having friends or guests over, sure.
When said person is making a fulltime income solely from renting space in an apartment that he is only leasing, well, "most people" would think "I should probably take a look at my lease first"...
I think it's pretty much de facto standard that you must disclose first hand before you sign the lease contract whether you rent the place for living or for business. Subletting is not always forbidden but you have inform the landlord before you subleasing.
> I don't find it that hard to believe that someone would blindly sign a lease after only quickly skimming over the important bits and then never look at it again.
I don't find that hard to believe either.
What I find revolting is someone not reading the lease, violating it, then playing the victim.
The clauses in your lease which expressly forbid this sort of activity would actually probably count as the "first you heard from your landlord that he didn't want you AirBNB'ing." It's not like you were unaware of them - you wrote that you "had flouted the same clauses" before.
Now that you were cranking tons of guests through for personal gain, you were surprised when your landlord took exception. If I found out that somebody was blatantly disregarding the rental agreement they'd signed with me for commercial gain, they would not be getting a friendly "hey brother, can you please stop?" phone call either.
It sounds like the OP was actually an excellent host, and that's worth something on AirBnB. The landlord wouldn't necessarily be able to consistently pull in the kind of high-quality guests by himself.
The OP is a parasite, abusing his landlord's resources for gain. Also, if he hasn't declared his 'rental' income for tax purposes then his problems are only just beginning ...
The OP pays his rent. He abused his landlord's resources in the sense that his lease prohibited his behavior, but there's no need to label him as a parasite. His behavior is no more parasitical than the behavior of the landlord himself. If you have no moral objections to rent, your objection to someone creating value by providing rental liquidity and turning a small profit while doing so is bewildering.
>"He abused his landlord's resources in the sense that his lease prohibited his behavior"
He signed an agreement with another party saying he would not do what he ended up doing, for profit. How are you equating that with the landlord collecting rent?
Maybe if the landlord signed an agreement with one rent price, then started charging a higher price, you could equate the two behaviours.
>Why would the landlord want a middleman in this case?
for the reason I stated, someone to look after the place while multiple Airbnb guests come and go. Otherwise you'll need to pay for a cleaner and check the place every time someone stays. That middleman is taking a lot of the pain of managing a property away from the landlord.
I'm glad someone made the connection; if his landlord is going to Airbnb anyway, why not cut a deal?
If I was his landlord, I would have more than enough leverage with the breech of contract to get him to sign a new similar contract, this one charging maybe 2 times more rent. The landlord gets paid more, which in turn covers his slightly higher (or possible the same) landlords insurance and then some. The landlord lets his tenant do what he's good at (maintain a sterling Airbnb profile and choose good renters) and the landlord takes a larger cut. Worst case scenario, his tenant doesn't take the deal and the landlord proceeds to kick the tenant out for breech of contract (could possibly lead to a court battle, but breech of contract is a pretty cut and dry phenomenon and the contract most likely has breech of contract clauses built into it) and do was he was going to do anyway (rent it out through Airbnb or otherwise).
As it stands the landlord will be throwing money at lawyers (possibly covered by landlords insurance, but could effect the premiums later), which may not turn out favorably for the landlord in court, to ultimately do something that is outside his area of expertise (act as an Airbnb hotel himself).
> If I was a landlord I'd have no more problem with this
Until you are a landlord, you can't really say for sure what you'd do as a landlord. I just recently started renting out my house. Going into it I was all "as long as they pay the rent on time and don't trash the place, I don't really care who rents it". But then I started getting into the fine points of liability and eviction rights and all the icky stuff you never see as a renter. And then I started showing the place to prospective tenants and started to realize how critical it is for me to choose the right people to live in my house. After doing all that, I would really hate to see the tenant let someone I know nothing about rent the place. And so the lease states they can not. The wholesaler -> customer relationship is not the same as landlord -> renter.
I don't think it's the same situation as somebody reselling goods you've sold wholesale. As other posters mention, running a commercial operation from a residential apartment brings with it a number of insurance concerns for the landlord, safety and security concerns for other tenants (which would also be the landlord's concern), and no doubt a host of other liability issues which I'm ignorant of because I'm not an NYC landlord.
If you were a landlord who was an AirBnB fan, you could certainly choose to not include clauses that specifically forbade this sort of activity. This guy chose to lease somebody else's property and then go ahead and use it in a manner that was expressly forbidden by his lease agreement to line his own pockets.
I have zero sympathy for him. He got slapped down for misusing somebody else's property and rightly so.
So, naturalists observe, a flea.
Hath smaller fleas that on him prey;
And these have smaller still to bite 'em;
And so proceed ad infinitum.
-- Jonathan Swift
Crazy: I had the same landlord. I drove by his management office on Box Street last week and saw it was turned into a hotel, and now I see the luxury lofts listed on Airbnb.
He's not a normal landlord, he's a shark. He owns several dozen buildings, prefers paying fines to getting permission, and once had our whole building manned with thugs to prevent a city agency from entering the building and confirming that he was constructing a unit on the roof without a permit.
He even connected several of his buildings' toilets and sinks directly to storm drainage pipes, dumping raw sewage straight into the creek (http://bit.ly/L3f8Ey).
Those sorts of actions are what regulation was supposed to prevent.
The current option, of crowd-sourcing information about possible lodging, wasn't previously possible. While we still need regulation to prevent the dumping of raw sewage, we could get so much more out of the space we have with decentralized, information-rich decision making.
Plus, it's not like regulation has actually kept people like him from doing illegal things. As long as the punishment is "a fine" breaking the law is just another cost of doing business. If instead the government could evict him from his properties he might possible decide its worth following the law.
I wonder how many home owners renting through AirBnB properly report commercial use of their home to the property appraiser for homestead exemption purposes. My guess is zero.
It's not up to you to determine what is a "little" thing and what's a "big" thing. It's up to the people who signed the contract. Apparently, the landlord thinks it's a big thing. In fact, I never met a landlord who didn't. They always verbally specified that I am not to run a boarding house, on top of it being in the lease. Probably because I was a college kid and well, rent to a college kid and you get a boarding house ...
Actually, it's because the landlord could get sued or even end up going to jail due to stuff you did if his contract doesn't protect him from issues resulting from the sublease. The #1 concern with being a landlord is liability.
I'm a landlord and my wife works in property management. Here's why this is a big deal:
You're technically violating contract law and opening yourself and the landloard up to a ton of liability by doing this. Leasing and renting is much more complex than simply letting someone sleep over at your property. A property owner can get in some serious trouble if something were to happen (someone gets hurt, robbed, etc..) and he/she hasn't taken the correct steps to protect his/herself. Not to mention the issues around covenants, local ordinances/regulations, taxes, mortgages, and insurance.
There are clauses in leases the landlord will often let slide. For example, limits to number of cars on the property. Such clauses are often there so that the landlord can take action if the tenant does something like put eight cars on blocks on the lawn, rather than actually attempting to limit the tenant to 1 car.
There are also clauses in leases that are completely unacceptable to break. For example, paying rent.
One of my clauses is that I can't run a business from my apartment. I know this is meant to prevent me from warehousing or having some kind of showroom type traffic going on - and I am fine doing programming on my own stuff or other projects in my place.
Yeah... this is why the San Francisco rental market is a joke. I'm pretty sure the standard SFAA lease is more or less designed to be broken, so that the landlord can toss you out if he needs to (because otherwise the inane rent board regulations would keep him from doing so even in a legitimate situation).
On top of that you have landlords who tell you "oh, such and such won't be a problem" even though it says in the lease that it's a problem and that the lease comprises the whole of the agreement. (cough hi, J Warvro and Associates, it's me again cough) And no one wants to modify it because it's too legally risky.
How would modifying the SFAA lease be legally risky?
In the absence of a written lease, the obligations of a tenant to the landlord are to not cause damage to the landlord's property -beyond ordinary wear and tear-, to pay the landlord the agreed-upon rent in a timely manner, and to not interfere with the quiet enjoyment of others tenants in the building. A landlord's obligation to his tenants are to provide a place that's fit for habitation (There are some things like a functional phone jack in definition of that), ensure that any hazards that may be caused by damage to the building are rectified in a timely manner, and to address any tenant's complaints regarding those two items.
A written lease will generally only add restrictions on one or both parties. Unless explicitly changed by the terms of a written lease both parties are required to live up to the basic obligations that they would be held to in the absence of a written leasing agreement. (And even then, there are certain obligations that a landlord cannot free himself from.)
Edit: Replaced "waive" with "free himself from" in last paragraph. "waive" wasn't the right word to use.
In San Francisco, the Rent Board places additional obligations on the landlord and declares random things legal and enforceable or not legal and not enforceable. (For instance, a recent example: if there are multiple tenants in the apartment and their rooms are the same, they may not split the rent unequally. it must be split proportionally. so decreeth the rent board.)
The SFAA lease contains things that are... battle-tested.
If you're a tenant, it's not your problem, but if you're a landlord, you probably don't want to be one of those guys who ends up with a tenant that's impossible to get rid of, stays in the apartment forever, and pays half of what you could get if you could legally rent the apartment to someone else (which you can't).
You're right. The SF Rent Board does add some rules to try to ensure that a landlord can't evict a tenant simply because he's insufficiently profitable. But, from my POV, those are obligations that a landlord has to the local government.
"if there are multiple tenants in the apartment and their rooms are the same, they may not split the rent unequally. it must be split proportionally. so decreeth the rent board."
Do you have a citation for this? The only possibly relevant section that three minutes of searching turned up was 37.3(c) "Initial Rent Limit for Subtenants".
"[The] Rent Board ... declares random things legal and enforceable or not legal and not enforceable."
Law at all levels is more like quicksand than bedrock. At least the Rent Board has a consistent and public agenda. Do the Rent Board's actions make more sense to you if you view them as a Renters' advocacy group?
"If you're a landlord, you probably don't want to ... [end] up with a tenant that ... pays half of what you could get if you could legally rent the apartment to someone else."
Is this the meat of the "legal risk" that you were talking about earlier? If so, you're not talking about legal risk; you're talking about limiting earning potential.
For something like forty years it's been the position of the SF Rent Board that the renters of San Francisco should be able to find, secure, and retain affordable housing whose rental rates more-or-less track the -actual- increases of costs to the landlords who rent out the space. If you do even the smallest bit of research before you decide to become a landlord, you'll discover that the city will make it hard for you to throw people out of their homes simply because they aren't making enough money for you. What's more, you'll discover that things have been this way for decades.
I suppose "political risk" would be a better term than "legal risk" per se. Subtle differences in the lease and established law increase the risk that the landlord has an unfavorable outcome (possibly including earning potential loss). As a consequence, they are unwilling to consider any changes to the lease, even a minor one, not simply because they may be screwed, but also because there are hundreds of other prospective tenants who would jump at the apartment who won't present them with any such risk.
I don't understand why the amount is important. He did not cause $20,000 in damages to the landlord. At most, he did $20,000 in damages to the hotel down the street.
No, he didn't. But he did do some damage. That's the nature of property, the more it's used, the more damage it accrues. By having "extra" people in the apartment, the property was being depreciated at a greater rate without compensation to the landlord.
I'm unsure that this makes sense. If he had picked up a roommate instead of renting on ABnB, the landlord wouldn't have gotten more money, yet there would more 'more people' causing 'more damage.'
Generally, the shorter time you're staying for, the less invested in the property and community you are. For an example, a guest will on average think less of making noise when coming in late than a tenant who will be having a longer term relationship with the neighbours.
Personally, I've never known anyone that would treat a place poorly just due to a short stay. The people I know that would treat a place poorly are people would do so on a long or short stay.
To that point, I wouldn't think it matters in any appreciable way.
The lessee is still responsible for those damages whether or not he was renting the room, so the landlord has a path for recompense in the event that any portions of the place are damaged to the point of requiring rumuneration.
And that's the key. I have never met a landlord who demanded compensation from regular wear and tear. Not for the appliances, floors, walls, etc.
I wasn't talking about holes in walls. I was talking about the general wear and tear that the landlord would never be compensated for. In the end, he would have to replace appliances out of his own pocket at a faster rate, etc.
Because, at the risk of repeating myself, $20,000 isn't "little ways".
It is $20,000. We are talking about something important here. Yes, we all make a few holes in the wall or unsanctioned little repairs or something, but we're talking $20,000. It's not "little things". I'm not saying it's automatically "damage" or harm of any kind. In fact it pretty clearly isn't since it's hard to miss $20,000 in damages. But we're not talking about a couple holes in the wall, we're talking about $20,000.
I've got a very simple four-word point, and I was not trying to imply any further argument.
The large amount of profit may inspire attention, but it doesn't correlate with the extent of lease violation (to my mind).
The lease likely mentions guests generally, not charging for them. Which would mean CouchSurfing.org is just as problematic - and that the amount of profit is immaterial.
You seem to be continuing to impute arguments to me that I am not making. No, I don't particularly think that AirBNB is especially problematic, I think the entire "genre" of business faces the same problems. None of them are the sort of little issue we don't have to worry about, they're all worth talking about (and, alas, probably litigating and legislating about).
He may have imposed more than $20,000 in potential liability on the landlord (i.e., if something went wrong). Standard insurance does not usually extend to the hotel-style leasing that AirBnB offers, so the landlord (and the tentant) would have been personally liable for any damages.
It is possible that the actuarial value (i.e., risk-adjusted value) of those potential liabilities exceeds $20,000, but we would need more information to know.
In general, I'd have to agree this is a clear violation of his lease and doesn't deserve sympathy, but have you guys seen the piles and piles of legalese in these New York City leases? The lease itself doesn't deserve sympathy! For example, my lease last year from a private landlord even stipulated I'm not allowed to go to court and must use arbitration instead. I didn't think through it well, but next time I'll know better. It didn't become an issue though.
New York is considered much friendlier towards renters than most other places. It's generally agreed(?) arbitration favors the repeat customer (the business) because why would you bite the hand that feeds you? So, I'd say arbitration is not as good as it sounds from a first glance.
Does anyone have any insight to cast on this whole arbitration system?
The more I think about this and how it impacts me as a landlord, I am starting to see Airbnb as (warning: the following analogy is not perfect) the Napster of lodging. I think they'd better step up and become the iTunes of lodging in this regard, before more news stories like this start creating a rift between landlords and Airbnb.
I don't think it's that much of an issue, really. The problem isn't on Airbnb's end. It's on the renters that are giving up their rental property without examining the contracts that they signed. Airbnb could probably be treated the same as subletting or renting out the property, so any clauses in the lease/association contracts that covers that should cover Airbnb.
The important thing for you, as a landlord, should be to make this clear on the contract. Whether it's increasing the deposit or rent if the renter wants to open up the property to Airbnb-like usage or just not allowing it period, it should be clear in the contract.
EDIT: Airbnb actually does state this in their terms of service:
>Accordingly, you represent and warrant that any Listing you post and the booking of, or Guest stay at, an Accommodation in a Listing you post (i) will not breach any agreements you have entered into with any third parties and (ii) will (a) be in compliance with all applicable laws, Tax requirements, and rules and regulations that may apply to any Accommodation included in a Listing you post, including, but not limited to, zoning laws and laws governing rentals of residential and other properties and (b) not conflict with the rights of third parties
Sure, but why not actively reach out to landlords (and city governments, etc)? Wouldn't it be better for Airbnb and everyone else if both (a) and (b) became less likely to be impediments?
I am in a fairly rare position where I'm feeling that I would actually be receptive to advocacy (and I'm a very stubborn person), but nobody's advocating anything to me yet. I feel like a music publisher in the year 2000 saying "Great idea! What would you like to see in a downloadable music service?"
What can Airbnb do? They're not a party to any agreement that a landlord has with their tenants, and I don't think they want that.
You're a landlord. You mentioned in another thread here that you have a strict "no subletting" clause in your contracts with your renters. What could Airbnb do to change your mind? Nothing, I would wager. They don't offer insurance to their client hosts, so they're definitely not going to assist with your insurance.
They could advocate for making a "no subletting" clause less restrictive, and show some data, or at least give a rationale for why I'd want to do that.
I'm totally willing to change my mind. In fact, I'll probably take that step on my own when I rewrite my lease. I would just like to know other people's opinions on best practices instead of taking a shot in the dark, and Airbnb seems uniquely positioned to come up with something.
What would be bad is for stories like this to create a backlash from landlords against Airbnb and reduce the usefulness of the concept.
Sometimes capitalism gets in the way of distributing goods and services. Usually when people try to decide what other people shouldn't and shouldn't do with things they sell to them.
I agree, but unlike the weird ownership issues that come with, say, copyrights and boxed software, this is a case where I quite literally still own something, and I'm letting someone use it for a fee. Laws put all kinds of restrictions on me, but some decisions on how my property is used still stay mine.
Let's be frank: landlording has never been socially productive. All the actual services provided by a landlord can be provided by a homeowners' association in a condo or cooperative building. It's really just a class division, an issue of bad public policy, and an issue of the balance of local housing markets between renting apartments, buying condos, and buying houses.
If they're throwing the book at you -- throw it right back. Tell your landlord that you're going to find the hotel closest to your apartment and show up with printouts of their newest illegal competitor: your landlord.
It sucks to get the government involved with these disputes, but he opened the door.
New York hotels are highly regulated. I'm making the assumption that the landlord doesn't have the right permits (and isn't paying the taxes) to run a hotel.
The point is there are no clean actors here. A landlord running an illegal hotel and a renter that broke their lease. But thanks for calling me a sociopath. ;)
Almost every rental agreement I've ever signed disallows sub-letting. They also have rules about having people come to stay (as roommates, rather than as sublessee.) no sympathy whatsoever.
Now why did the landlord decide to list rooms him/herself? That's interesting. Could Airbnb become a way for small-business hotels to book rooms? Generally landlords don't want short-term tenants for various reasons. I wonder if the Airbnb idea, which plays on the social aspect of borrowing an individual's house vs. dealing with an dispassionate corporate entity, enables leasing of smaller properties to work. If that's the case, then a landlord seeking to run Airbnb listings to turn a few rooms in an apartment complex into a hotel might eventually run into trouble if this kind of arrangement becomes common on Airbnb, since then you lose the social aspect that was making the tenants well-behaved. With tenants who might abuse the property a small apartment landlord probably would not want to deal with them.
Maybe an enterprising landlord could put in a clause claiming 50% (or more) of the revenues from Airbnb if any tenant chooses to use it. In fact, maybe the OP should offer such an arrangement to the landlord as a settlement and thus be able to remove the restraining order and continue making some profit.
It isn't exactly clear but it seems this person has violated terms of his lease. So I'm not sure what is the issue here. Is he looking for sympathy? Or just warning others to look at their lease agreement before starting down this path?
Nope, it's just a story. And a taste of things to come vis a vis the future of airbnb and similar services.
I have no sympathy for this guy, and I have the greatest sympathy for his landlord. I'd be annoyed if anyone started using my rental property as a hotel due to the greater wear and tear; in fact, this is semi-common in the area where I own rental property so I keep an eye out for the possibility when selecting tenants.
You charge $1200 to rent a dwelling out. It's $1200 flat. Whether 1 person @ 1200 or 3 people at @ 400 each.
How do you somehow accrue more nebulous "wear and tear" from a temporary visitor than you would from a second lessee? It's still no more than two people at once.
This is not necessarily true. Some people rent out the living room couch as well as the spare bedroom. Besides in the second lessee case, the landlord at least gets to vet the second person.
Vetting only lessens the chance of catastrophic damage from an idiot tenant, though. It does nothing to mitigate wear and tear. That was what my now-masisvely-downvoted point was. The "wear and tear" argument is on pretty shaky ground.
The wear and tear argument was not made along with a vetting argument. Vetting is one issue. Wear and tear is another issue. There is some ground between the perfect tenant and the idiot who burns a place down. There are all those people in the middle that go about their lives and little things happen. But have you ever heard the saying "drive it like its a rental"? People will naturally be slightly more careful with things they own or have a direct responsibility to take care of. The more people you have using a space that are not directly responsible for its care, the more likely those little things will happen. We're not talking about the catastrophic damage. We're talking about things like the extra nicks in the banister caused by someone dragging their suitcase up the stairs. When you have a new person dragging their suitcase up (and then back down) the stairs once a week, the chances for additional nicks goes up. Eventually all those little things start to build up. And it is pretty easy for a one of those rotating guests that caused a little more damage to just move along since its not their apartment building. People who live there and have a responsibility for the place (and coincidentally have been vetted) are more likely to notify the landlord to get it corrected.
Huh... I thought there are usually clauses regarding "subletting" when signing a rental lease? At least where I am anyway, "subletting" is generally frowned on.
I'm a landlord. The language in the lease I use clearly stipulates no subletting.
There are very good reasons for this. I did a background check on my tenant, not every possible person my tenant may randomly hand the keys over to, unsupervised. It's really not the same thing as having guests over.
That said, I'm not opposed to including some kind of pro-Airbnb language in my next lease. This is new territory so I don't know what it should be. A larger security deposit? A cut of the proceeds?
What's in your lease might not matter, leases often contain clauses which are completely unenforceable which courts can freely choose to ignore if they believe the term is unreasonable.
I'm pretty sure I can get "you can't charge other people money to live here" to stick. A no subletting clause is pretty standard where I'm from and it seems to apply here.
In Chicago and iirc San Francisco, landlords are required to accept reasonable subletting arrangements; no-sublet clauses are unenforceable --- but requirements to get the approval of the landlord are.
In Chicago, the law says that landlords must accept a "reasonable sublet." So it's not even up to the landlords.
That being said, running a BnB is different from subletting. With subletting, you enter into a long-term (i.e. a month or more) lease agreement with your tenant. With a BnB, you have more people coming and going for much shorter stays. Here's why that distinction can matter.
In probably every US jurisdiction, the law distinguishes between apartment buildings and hotels. If I own an apartment building, I can't just let my leases expire, hire some maids, and starting renting rooms out by the night.
For starters, there's zoning. Hotels generally require a different zoning code than apartment buildings. If the local government catches you in flagrant violation of zoning laws, expect trouble.
Next, there's permits. You need a different set of permits for a hotel vs an apartment building. Again, this would usually be enforced by the local government, and they will come after scofflaws. (Permits are a source of revenue for them, so they have a strong incentive.)
Then, there is the building's mortgage, if any. It's not unusual for mortgages to have restrictions on how the building is used. Will the bank foreclose on you if you start running your apartment building as a hotel? Possibly not, since they make more money collecting their monthly payments than foreclosing. But it's still a risk.
Those are three big reasons why a sublet is different from running a BnB out of your apartment. Will any of those things come into play if you, a landlord, look the other way about one of your tenants who's on AirBnB? Hopefully not. But the problem is that if you show you're willing to tolerate it, and it gets out of hand, then you might have to share the blame. Which is why it might be prudent for landlords to crack down as soon as they find out about this type of activity.
The only place I've seen subletting really tolerated has been college towns, specifically for the summer term of school. Students sign 1 year leases, and are often not in town over summer, so a certain degree of tolerance for sublets seems to have developed.
Last time I used AirBNB, I rented an apartment, and 1 hr after I arrived the landlord showed up banging on the apartment door, furious, threatening to call the police.
Thankfully, my social skills calmed her down, but now the apartment leasee (lessee?) is knee deep in legal matters. Clearly the lessee broke the lease, however I'm sure she didn't really understand so at the time.
AirBNB needs to be much clearer in the listing process of the possibility and legal ramifications of violating one's lease. Especially since it ends up hurting not just the people listing apartments, and apartment owners, but also AirBNB customers who trust the listings on the service to be legitimate and lawful.
Oh boy, I wonder if this guys knows what he's up against tomorrow (7th, June). If he's lucky the landlord will just tell him not to do it again. If not they'll be allowed to rip up the lease; now he's got 2 problems.
Crazy: I had the same landlord. I drove by his management office on Box Street last week and saw it was turned into a hotel, and now I see the luxury lofts listed on Airbnb.
The author of the post seems shocked that he's in violation of anything. Perhaps he'd like to share excerpts of his lease before he feigns such shock.
Come on, the guy lives alone in a 3+ bedroom apartment in Brooklyn. We all know he signed that lease specifically to run a pseudo-hotel business under the guise of an Airbnb profile. He whines that he can't afford to live in the New York rental market without roommates; so get roommates or move somewhere cheaper.
BTW, the author is a professional writer who (gasp!) has a brand new startup to plug.
edit: It sounds like this guy has a sincere love for the experiences and newfound social life he's found when acting as an ambassador for his city. His heart is in the right place. He would make a great Couchsurfing host and probably make even greater, long-lasting relationships.