Cities with the Most Airbnb Legal Issues
The success of your Airbnb real estate investing highly depends on the location of your vacation rental property. So it’s better to avoid cities with Airbnb restrictions where Airbnb operations are substantially limited.
Let’s take a look at Airbnb regulations in some cities with the most Airbnb legal issues.
New York City, NY
New York is the biggest tourist destination in the United States, but the Airbnb regulations here are pretty strict. There are many laws and regulations that are currently in place, and failing to abide by these laws can result in hefty penalties and fines.
The main issue with becoming an Airbnb host in New York City is complying with the state’s Multiple Dwelling Law (MDL). It prohibits renting out unhosted space of fewer than 30 days in “Class A Dwellings” (buildings with three or more units). That means you can’t legally rent out your apartment while you’re away for the weekend.
If you have a single-family home in New York City, you may be subjected to zoning restrictions. For example, you may need to meet specific building codes to meet the legal requirements for rental property.
The host can only have two paying guests staying in the home or apartment for less than 30 days. The Airbnb host can’t install any locks because guests must have free and unobstructed access to all rooms and exits.
Keep in mind that the City of New York requires that home-sharing platforms like Airbnb share data about listings and you as a host (they must obtain your consent for this). If you don’t consent to share your data with the city, you won’t be allowed to host short-term stays on Airbnb. That means you’ll only be able to host guests for stays that are 30 nights or longer, which are exempt from data-sharing.
San Francisco, CA
San Francisco was among the first cities to regulate short-term rentals. Airbnb hosts are required to register as a business and receive a valid Short-Term Residential Rental Certificate from the Office of Short-Term Rentals. You can register your listing only if you live there for at least 275 days per year.
A host can rent out a spare room for an unlimited number of nights as long as they stay at the property. But they may rent out their entire space while they are absent for up to 90 days per year.
Hosts in San Francisco must pay taxes on their rental properties. San Francisco imposes a 14% Transient Occupancy Tax (TOT) on short-term reservations (less than 30 nights). Airbnb collects and remits the TOT in San Francisco.
Los Angeles, CA
According to Home Sharing Ordinance (CF 14-1635-S2), home-sharing is permitted in Los Angeles if your listing is your primary residence where you live for more than six months out of the year. Hosts are required to register with the city and post their registration number on all listings. The fee for a home-sharing registration or renewal is $89.
Airbnb hosts in Los Angeles are allowed to rent out their residences for a maximum of 120 nights per year. Exceeding the limit will result in daily fines. If you want to host for an unlimited number of nights, you must register for extended home-sharing and pay an $850 fee.
The City of Los Angeles imposes a 14% Transient Occupancy Tax on the listing price (including cleaning fees) for stays of 30 nights or less. Airbnb collects and remits the City transient occupancy tax. But hosts are still required to file monthly returns to the Office of Finance and take a deduction for tax collected and remitted by Airbnb.
Santa Monica, CA
Santa Monica prohibits renting out an entire home as a short-term rental while the host is not present. The city only allows home sharing for less than 30 days when at least one of the primary residents lives on-site throughout the visitor’s stay.
If you want to home-share your primary residence, you must apply for a home-sharing permit and business license. The Santa Monica Short-Term Rental Ordinance contains restrictions on the number of group bookings, occupancy, and visitor vehicle limitations.
It limits the occupancy of the home-share to less than ten persons, one person per 200 square feet of the dwelling unit, or two persons (excluding minors) per bedroom.
Santa Monica assesses a 14% Transient Occupancy Tax on the listing price, including any cleaning fee for 30 nights and shorter reservations. Airbnb collects and remits transient occupancy taxes in Santa Monica.
Las Vegas, NV
Airbnb rules and regulations in Las Vegas ban non-owner-occupied rentals. Airbnb hosts must receive a business license, carry liability insurance of $500,000, and renew their rental permit every six months to avoid fines. Hosts must register with tax authorities, collect taxes from guests, and remit them to the city and county.
The short-term rental property must have no more than three bedrooms and be at least 660 feet from any other short-term residential rental. The maximum occupancy of a short-term rental must not exceed two adults per bedroom.
Additionally, Las Vegas prohibits the use of short-term rentals for weddings, birthday parties, receptions, and other types of special events.
Final Thought
When planning your vacation rental investment strategy, you should remember that each jurisdiction has a different set of rules regarding short-term rentals. At present, many legal challenges surround short-term rentals in residential neighborhoods, and some cities have introduced Airbnb restrictions.
If you want to become an Airbnb host, you should be aware of the legal requirements in your area. Keep in mind that laws around Airbnb restrictions are changing rapidly, so it’s crucial to stay up-to-date.
You may also want to check our article to learn about the best places to buy vacation rental property in Europe and the US.
DISCLAIMER: the information in this article is not excessive and is not intended to give legal advice. Consult your lawyer and local authorities before starting an Airbnb business.
Sources:
https://www.airbnb.com/help/article/868/new-york-ny
https://maidsailors.com/blog/airbnb-nyc-rules-and-regulations-what-you-need-to-know/
https://www.airbnb.com/help/article/871/san-francisco-ca
https://planning.lacity.org/ordinances/docs/HomeSharing/adopted/faq.pdf
https://www.airbnb.com/help/article/864/los-angeles-ca
https://www.airbnb.com/help/article/908/santa-monica-ca
https://www.smgov.net/Departments/PCD/Permits/Short-Term-Rental-Home-Share-Ordinance/
