Rent Your Apartment, Break the Law

Greg Beato wrote in Reason's October 2011 issue about the glories of renting what you own, including a mention of Airbnb. As Beato wrote:

 At Airbnb.com, which allows homeowners to rent space to travelers, a guy who lives across the street from a busy park in San Francisco is renting access to his bathroom for $10 a day.

Not sure what the toilet laws are, but as the local news site Metro.US reports, users of Airbnb in New York City are scofflaws:

This month, thousands of New Yorkers will hand over their apartment keys to strangers, making a few extra bucks by renting out their homes when they head out of town.

But they might not know they're actually breaking a city law. A law that went into effect this past May bans renting out apartments for fewer than 30 days.

The law was created to target residential buildings illegally converted into makeshift hotels, but still applies to those who rent out their room for a night or two on popular sites like Airbnb.com.

Enforcement is based on complaints, so the city can issue violations and fines — but only after a neighbor calls 311 and complains, said city spokesman Marc LaVorgna.

And New Yorkers who rent out their rooms on Airbnb have indeed been fined, said LaVorgna. One Clinton Hill youth hostel, Loftstel, which advertised on Airbnb, was slapped with a full vacate order in May, he said.

Fines for illegally renting out rooms can range from $800 to $2,500, but it's not the renter who pays, it's the landlord.

There may indeed be markets in everything, but there are also market-disrupting and unhelpful regulations in everything.