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Buildings May Now “Opt Out” of Allowing Short-Term Rentals

Short-term rental services such as AirBnB, VRBO, or may be convenient for travelers, but in the context of residential apartment buildings, many coop and condo boards and rental landlords wish to prevent their residents from listing their units with these services.  Among other concerns, such transient rentals raise security concerns as building management may have no way to know who may be present in the building and cannot conduct reasonable background checks.  Short-term renters may also create a nuisance in an apartment, with no remedy available to the other residents.  In many circumstances, short-term rental use of an apartment may also violate the law and government regulations applicable to the premises, as well as the terms of the lease or of applicable by-laws or house rules.

In New York City, Local Law 18 of 2022 will requires hosts of short-term rental properties to register them with the Mayor’s Office of Special Enforcement (OSE).  Commercial short-term rental sites are prohibited from processing transactions without first verifying the premises’ registration status.  Moreover, building owners, including coop and condo board and rental landlords, will be able to sign up on a City list of buildings that prohibit short-term rentals.

The new law is scheduled to take effect on January 9, 2023, although the OSE regulations to implement it have not yet been finalized and will be the subject of a public hearing on January 11, 2023.  After a four-month transitional period under the new law, unauthorized short-term rentals will be subject to a civil penalty of up to $5,000 per violation or three times the rental revenue received by the violator.