The Ghost Airbnb Market in New York City: How Owners Are Evading Short-Term Rent Bans

Since the implementation of stricter regulations on short-term rentals (STRs) in New York City, many Airbnb owners have had to pivot their strategies. The initial crackdown, intended to reduce illegal short-term sublets, has led to the creation of a "ghost Airbnb market." This informal network of listing and renting apartments, often conducted through social media and unregulated platforms, has continued to thrive. In this article, we explore the tactics employed by Airbnb owners and the impacts of these ghost listings on the housing market and traveler trust.

The Impact of Short-Term Rent Bans in New York City

According to an article by Planetizen in A ‘Black Market’ for Short-Term Rentals Grows in NYC by Diana Ionescu on November 29, 2023, after New York City implemented new rules that drastically reduced the supply of STRs, many landlords found ways to circumvent the ban. In the initial weeks of the ban, nearly 80% of the available units were taken off the official Airbnb platform. However, the "ghost Airbnb market" continues to exist, with listings and transactions shifting to more unregulated channels.

The closure of the formal market has not deterred some owners. Many are now using social media and other websites to Listings are no longer visible on the official Airbnb site, but they still exist in a shadowy realm, creating significant challenges for enforcement.

Evading the Ban: New Tactics and Unregulated Platforms

The shift towards informal methods has led to an increase in listings on unregulated platforms. One of the most notable is the use of Craiglist, which is known for its ability to bypass stringent regulations. As an example, the author of this article moves to New York City and spent seven months living in short-term sublets each found via Craiglist. These listings are often easier to find and less restrictive, making them attractive alternatives to the formal Airbnb platform.

Another significant player in the informal market is Vrbo. While Vrbo itself is banned in New York City, an Amsterdam-based company outside of American legal jurisdiction has taken advantage of this. The unregulated platform allows for the listing of new short-term rental apartments, indicating that legal constraints are difficult to enforce across borders.

The Implications for Travel and Trust

The widespread use of these informal channels raises concerns about the safety and trustworthiness of rentals. Velsey, as reported in Curbed, notes that Venmoing strangers money requires a significant amount of trust. This trend suggests that travelers are willing to take on more risk to secure a place to stay, which could harm the trust that previous generations of users had placed in Airbnb.

The net effect of these informal listings is a shift back to long-term rentals. According to Velsey, long-term listings on Airbnb have increased by 37%. This suggests that the initial goal of bringing more units back to the long-term rental market may have been achieved, albeit through unconventional means.

Conclusion

While the official Airbnb listings have drastically shrunk since the implementation of new rules, the ghost market remains robust. This informal network is a testament to the continued demand for short-term rentals and the challenges faced by regulatory bodies in enforcing such bans. The use of unregulated platforms and social media highlights the necessity for more comprehensive and geographically expansive measures to address the issue of short-term rentals.