Buildings for Landlords: Want to End Short Term Rentals in Your Building? Get on the “Prohibited Buildings List”
By Rachel Sigmund McGinley
On January 9, 2023, a new law known as Local Law 18, also known as the Short-Term Rental Registration law, became effective. This new law requires short-term rental hosts (rentals fewer than 30 consecutive days) to register their apartment with the Mayor’s Office of Special Enforcement (OSE) and receive a registration number. Booking services such as Airbnb, VRBO, Booking.com, etc. will be prohibited from listing any unregistered short-term rental.
To register an apartment with OSE, the owner or tenant of the apartment must certify to OSE that (a) the short-term rental is not prohibited by a lease or other agreement; (b) that they “understand and agree to comply with provisions of the zoning resolution, multiple dwelling law, housing maintenance code and New York city construction codes relating to short-term rentals;” (c) that “there are no uncorrected violations of the New York city construction codes, the housing maintenance code or the fire code that would endanger occupants of such dwelling unit;” and, critically, (d) that the building does not appear on the Prohibited Buildings List (PBL).
The PBL is the portion of the law that condo and co-op boards have been yearning for. The PBL allows building owners (including condo and co-op boards) to simply register with the City to prohibit short-term rentals in their building.
OSE is required to deny any registration requests for apartments located in buildings on the PBL. In addition, OSE is required to notify building owners (including condo and co-op boards) of any registration application for an apartment in its building, which will take out all the investigatory work that, up until now, boards have had to in order to confirm that an apartment is being used as an illegal short-term rental.
Registration through OSE has not yet begun; OSE currently estimates that registration will open in late February.
Enforcement of the registration requirements will not begin until July 2023, but enforcement of existing short-term rental laws remains ongoing. Hosts who violate the new law will be subject to fines ranging from $1,000 to the lesser of $5,000, or three times revenue from illegal rentals. Fines for booking platforms would be limited to the higher of $1,500 or the total fees collected from illegal transactions.
Short-term rental listings for units in “Class B” multiple dwellings, which have been approved by the City for legal short-term occupancies, are exempt from the registration requirement, as are rentals for 30 consecutive days or more.
By Rachel Sigmund McGinley, the Chair of Adam Leitman Bailey, P.C.’s Cooperative & Condominium Representation Group.