It’s been half a year since New York City decided to tighten the reins on short-term rentals like Airbnb, hoping to turn apartments back into homes for locals instead of temporary spots for visitors. The idea was to tackle some of the city’s housing headaches—think less noise, less mess, and more peace for the locals. Yet, the most noticeable change has been tourists heading over to New Jersey and small Airbnb hosts left scratching their heads.
When New York City put its foot down in September, around 15,000 Airbnb listings vanished overnight, adjusting to fit the new law by switching to longer stays. Fast forward to February, and the number has shrunk even more, to under 5,000, says Inside Airbnb, a group keeping an eye on these shifts. With New York expected to welcome a whopping 65 million visitors in 2024, other cities are now peeking over the fence, curious about how these changes play out. A quick Airbnb search these days will likely show you a room in someone’s apartment, a hotel room, or a place in nearby New Jersey. And while there are about 35,000 New York listings on Airbnb for month-long stays, it seems a lot of apartments that used to welcome short-term guests haven’t switched to long-term leases.
Airbnb’s head honcho, Brian Chesky, isn’t mincing words, calling New York’s move a warning to other cities thinking about clamping down on short-term rentals. It’s a global conversation now, as cities everywhere grapple with how Airbnb is reshaping neighborhoods and bringing tourists into traditionally residential spots. Whether New York’s tough stance will inspire others remains to be seen.
New York’s new rulebook doesn’t ban short-term rentals outright but it does lay down some strict ground rules. For starters, hosts have to actually live in and be around for the rental period, and they can only have two guests at a time. This has essentially ended the game for those swanky, investor-owned apartments, but also for regular folks who made a bit of cash renting out their place when they were out of town.
Folks like Tony Lindsay from the New York Homeowners Alliance Corp are voicing their concerns, saying the law missed the mark. According to him, most homeowners weren’t looking to become landlords; they just wanted a way to cope with rising housing costs without the hassle of a full-time tenant. The result? A lot of small homeowners are feeling the pinch.
But it’s not all doom and gloom. Hotels in New York and across the river in New Jersey are seeing a bit of a boost, with slightly higher occupancy rates and room prices. Places like Jersey City, Hoboken, and Weehawken, with their easy access to Manhattan, are becoming hotspots for short-term stays.
Yet, back in New York, the sky-high rents haven’t budged much. It looks like the ban on short-term rentals is just one piece of a much bigger puzzle in tackling the city’s housing crisis. Rent prices have seen a slight dip in some areas, but it’s too soon to tell if this trend will continue or if it’s a direct result of the rental restrictions.
As for enforcing this new law, it’s been a bit hit or miss. With Airbnb out of the picture for many, people are turning to places like Craigslist or Facebook Marketplace to list their apartments. The city’s still in the process of sorting through applications for legal short-term rentals, and while it’s keeping an eye out for illegal listings, fines haven’t started rolling out just yet.
Airbnb isn’t happy about the situation and has been vocal about its stance, pointing out the challenges for travelers and hosts alike, with no real win for housing affordability in sight. Meanwhile, people like Lindsay are feeling stuck, caught between a rock and a hard place, as they watch potential income from short-term rentals slip through their fingers.
In a city as dynamic and diverse as New York, finding the balance between welcoming visitors and keeping homes available for locals is a tough puzzle to solve. But one thing’s clear: this conversation isn’t over yet.
Disclaimer: This blog post reflects the author’s personal opinions and insights. Furthermore, it is based on current trends and information available at the time of writing. It should never be considered as financial or investment advice. The information presented here might not be up to date. Readers are advised to conduct their own research and/or consult with a professional advisor before making any financial decisions.
