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Ask Sam: Is it OK for me to rent out my rent-stabilized apartment on Airbnb?

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Question:

I have a two-bedroom rent-stabilized apartment, and my roommate just moved out. I don’t plan on replacing her. Am I allowed to occasionally rent out my extra room, i.e. on Airbnb? I saw on a city website that it’s acceptable as long as I don’t profit— does that mean I can make no more than my annual rent payment each year via these short-term rentals? What are the rules for renting out your space in a stabilized unit?

Answer:

While it is possible to rent out your second bedroom legally, doing so might still put you at risk of losing your stabilized apartment, says Sam Himmelstein, a lawyer who represents residential and commercial tenants and tenant associations

"What you're suggesting might technically be legal, if you follow certain guidelines, but it still might get you into trouble," Himmelstein explains.

First, keep in mind that thanks to new anti-Airbnb laws in New York State, it is illegal to rent out space in your apartment for 30 days or less, and you also have to be present in the apartment while your guest is renting in order for it to be above board. On top of that, New York City recently passed a law making it illegal to even advertise a short-term rental of under 30 days in a multi-unit building.

Second, there's the issue of using your rent-stabilized apartment to generate income. "You can't charge a roommate in a rent-stabilized apartment more than their proportional share of the rent," Himmelstein explains. "That amount is defined as the total rent of the apartment divided by the number of people living in it."

So if your rent is $3,000/month, that would mean your totaly daily rent is $100, and the most you could charge an Airbnb renter would be $50/day. "So you might be better off renting to a regular roommate who you could charge $1,500/month," Himmelstein says.

"The other thing that happens is that when other tenants see people coming and going with overnight bags, turning the building into a hotel, they often complain to the landlord," says Himmelstein. "And sometimes they take the complaint to the buildings department. They don't want their building turned into a hotel, because it makes them feel less secure."

And if the landlord or buildings department catches wind of your setup, you could wind up in court, and run the risk of losing your apartment. "It's case by case, but at the end of the day, the courts really don't like it when rent-stabilized tenants commercialize their apartments," says Himmelstein. "There are some cases that say that even if you're not technically violating the rules, if you turn your residential apartment into a B&B or hotel, and are turning your apartment into something of a commercial enterprise, that's a problem."

So if you do decide to rent out your second bedroom to short-term visitor, Himmelstein advises to follow city and state laws regarding Airbnb, not charge more than half of whatever your daily rent would be, and not to host visitors too often, lest you raise the ire of your neighbors. And if you do get into trouble with the management, says Himmelstein, "I usually advise clients in this situation to immediately stop renting out the apartment, and to refund the guests if they've charged any more than the daily rent."

"Usually, if you stop immediately and refund anything that might be deemed an overcharge, you'll be safe [from eviction]," says Himmelstein. "But it depends on how long and how much you rented it out, and how much money you charged."

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Sam Himmelstein, Esq., represents NYC tenants and tenant associations in disputes over evictions, rent increases, rental conversions, rent stabilization law, lease buyouts and many other issues. He is a partner at Himmelstein, McConnell, Gribben, Donoghue & Joseph in Manhattan.  To submit a question for this column, click here. To ask about a legal consultation, email Sam or call (212) 349-3000.

 

 

 

 

 

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