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Airbnb reveals that half of its hosts in New York City are breaking the law

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Mihai Simonia/Shutterstock
Airbnb wasn’t kidding when it said it planned to be more transparent in the future. In an internal report published earlier this week, the lodging firm revealed that 55 percent of New York City hosts are breaking the law.

How are they breaking the law? Well, in New York City, it is illegal to rent a whole apartment for under 30 days. Hosts caught doing that could be fined up to $50,000. NYC has hit a few hosts with fines in the past for failing to adhere to the city’s laws.

That doesn’t mean 55 percent of hosts will be fined, but considering the Attorney General’s 2014 report showed 37 percent of revenue came from hosts with three or more listings, some landlords are clearly abusing Airbnb by knocking up rent and reaping the rewards. That might force the Attorney General to push for more regulation against Airbnb.

The illegal hotels are tucked away behind all of Airbnb’s good reasons for using the service to arrange to stay in New York, like the fact that its hosts’ median earnings are only $5,110 per year, not enough to be considered a full-time job. The startup also claims that 95 percent of its hosts only share one listing, though it is quite easy to set up multiple accounts with alternative information.

84 percent of Airbnb’s hosts share listings for less than 120 days, and 78 percent are of low, moderate, or middle income, two more facts that make it sound like the majority are just average homeowners. That said, a minority of hosts are making over $100,000 per year from the service in New York City.

Some affordable housing advocates claim that Airbnb has skewered the information in its favor, instead of releasing an independent report. New York City council members Jumaane Williams and Helen Rosenthal have already called the disclosure “pointless,” saying that Airbnb refused to disclose any actionable data to the council members.

It is hard to judge what Airbnb’s presence in a city does, since the firm is so tight with host info. The growing regulatory pressure in San Francisco, New York, and a few other cities makes it seem like Airbnb is not as friendly as it appears, but regulators have not presented any alternative to the “shared economy” approach to renting apartments.

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