Gov. Cuomo declared war on Airbnb hosts Friday when he bowed to pressure from the hotel industry and signed one of the nation’s toughest laws regulating the home-sharing service — including steep fines just for advertising short-term rentals.
State law already bars apartment dwellers from renting their entire units for fewer than 30 days.
The new law — which carries fines of $1,000 to $7,500 simply for posting an available rental for any term short of 30 days — sent shock waves through the industry.
Airbnb officials rushed to federal court in Manhattan seeking to block enforcement of the law, scheduled to begin Nov. 1.
Free-market critics charged that Cuomo was out “to screw New Yorkers.”
“In a desperate attempt to hammer Airbnb to please the hotel unions, state officials just risked nixing $2 billion worth of economic activity that benefits people struggling to afford to live here,” said Brendon Muir, of the Reclaim New York good-government group.
Tenants who make extra income with the popular Web-based service were floored.
“I think the decision is ridiculous,” said Jeffrey Adams, a resident of Bushwick, Brooklyn, and Airbnb host for about two years. “There’s no reason for it to not be allowed, and the fact that he is putting such a large fine on it is insane.”
He’s now considering ending the arrangement.
“The fine really makes me want to stop using it because I won’t make $7,500 a year from it, so it doesn’t seem worth it to maybe get caught,” Adams said.
“I can’t imagine not having Airbnb,” he added ruefully.
The new law applies to all permanent residences in buildings with three or more units.
It does not affect one- or two-family homes or temporary residences like boarding houses, hostels and dormitories.
Tenants who violate the law face fines of $1,000 for a first offense, $5,000 for a second and $7,500 for a third.
Backers of the measure say short-term deals hurt the hotel business while taking affordable residential units off the high-priced housing market.
“Today is a great day for tenants, seniors and anyone who values the safe and quiet enjoyment of their homes and neighborhoods,” said state Sen. Liz Krueger, a Manhattan Democrat.
Peter Ward, president of the New York Hotel and Motel Trades Council, said: “For too long, companies like Airbnb have encouraged illegal activity that takes housing off the market and makes our affordability crisis worse.”
The powerful Real Estate Board of New York also lined up against the rental service.
A Cuomo spokesman said the governor carefully considered the bill before deciding Airbnb’s critics were right.
“Ultimately, these activities . . . compromise efforts to maintain and promote affordable housing by allowing those units to be used as unregulated hotels,” said the spokesman, Rich Azzopardi.
In court papers, Airbnb’s lawyers say the city and state violated federal law by penalizing the company for content created by and posted on their site by third parties. The lawyers argued that the law also violates the First Amendment.
Most people who list on Airbnb are only looking to make a little cash while they’re out of town, said Chris Lehane, head of global policy for the San Francisco-based outfit.
“It’s baffling to us in this time of economic inequality that folks would be looking to impose fines of as much as $7,500 on a middle-class person looking to use the home that they live in to help make ends meet,” Lehane said.
As of August, Airbnb had 45,000 city listings and another 13,000 across the state, making New York one of its largest markets in the world.
Additional reporting by Gabrielle Fonrouge