New York Says Majority of Airbnb Listings Are Illegal, Will Crack Down on Worst Offenders

The New York attorney general today put out an analysis of the four-and-a-half years of Airbnb user activity data it finally dragged out of the online accommodation marketplace this spring after a long fight.

Up to 72 percent of Airbnb listings in New York over that time were illegal, was Eric Schneiderman’s office’s takeaway.

The real question is how sanctions will be enforced. Schneiderman said he would be working with the city to investigate and shut down illegal hotels, which are the worst offenders. The units that are most specifically called out within the report are a dozen buildings in prime tourist neighborhoods that were at least 60 percent rented on Airbnb for half the year or more, “suggesting that the buildings were operating as de facto hotels.”

The details are somewhat more complicated than the headlines. Airbnb says it proactively removed 2,000 bad actor listings this year, which may well have included many of those hotel-type hosts. So they were included in the data even though they’re no longer on the platform. But okay, Airbnb should have probably kicked those members out much sooner.

Meanwhile, the AG is only including “private” listings, meaning it doesn’t include rentals where guests stay in a home with their hosts there as well. This might be a small minority of arrangements, but it’s still an overstatement to say 72 percent of all listings were illegal.

Of that subset of listings that the AG is considering, here’s what the data showed: 25,532 listings appear to violate New York State’s Multiple Dwelling Law or zoning laws, and they brought in $304 million in revenue altogether, $40 million of it for Airbnb. Six percent of hosts generated 37 percent of the revenue, with one user making $6.8 million from 272 unique listings over the four years. And Airbnb shows signs of cutting into the housing supply, with nearly 2,000 units booked more than half the year.

The AG suggests Airbnb should have paid $33.5 million in taxes over the past four years based on standard hotel occupancy rates. Airbnb says it’s offering to pay New York taxes, as it’s now doing in Portland and San Francisco, but claims that it’s being impeded by opposition from the hotel industry.

But this looks to be part of a broader negotiation. Even while calling Airbnb out, Schneiderman’s statement paid lip service to how “online marketplaces revolutionize the way we live,” and he said his target was cracking down on illegal hotels, not all of Airbnb. This still seems to be a push to go after the worst actors, not small-time hosts.

Airbnb is hoping for a compromise. “We need to work together on some sensible rules that stop bad actors and protect regular people who simply want to share the homes in which they live. We look forward to working with everyone in New York in the weeks ahead,” said Papas.

This article originally appeared on Recode.net.