Room-letting enterprise Airbnb is at the centre of a new controversy, with the landlord of a New York apartment block suing a tenant for USD 300,000 (AUD 418,300) for renting out her apartment on Airbnb.
Tenant Madalina Iacob is accused of costing the building over USD 60,000 in fines after repeatedly renting out her apartment for USD 200 a night on short term rentals sites including Airbnb, the New York Daily News reported.
“Under the law, the landlord is strictly liable even though it’s the tenant causing the violation – and even though we’re not participating in this with this lady,” the building’s lawyer, Lawrence Silberman, told the Daily News.
New York has major problems with Airbnb. A report last year by New York Attorney General Eric Schneiderman found that nearly three-quarters of Airbnb’s listings between 2010 and 2014 were essentially “illegal hotels” – defined as short-term rentals that violate state and city laws against renting out an apartment for less than 30 days unless the occupants are also present.
Hoteliers in New York and elsewhere say Airbnb and its hosts not only steal business, they evade the rules and regulations that apply to legitimate hotels, hostels and lodging houses – rules that govern fire safety, security and so forth.
Accordingly, New York has started fining the owners of buildings where tenants let out rooms via Airbnb or similar applications.
Iacob, a yoga instructor and life coach, pays USD 2095-a-month for her one-bedroom apartment. Reportedly, she was caught renting out her apartment for profit in May, earning the building four fines.
A city administrative law judge hit the landlord responsible with USD1000-a-day fines, totalling USD 45,000, for “transient use” and an additional USD 16,000 for good measure.
City inspectors have allegedly caught Iacob continuing to rent out her apartment on several occasions and the landlord is concerned that fines will mount up to USD 250,000. He has launched a lawsuit and lawyers are circling.
Written by Peter Needham