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What Airbnb Hosts in Boston Need to Know About the Latest Legislation and Pending Litigation

 Airbnb has changed the way people travel. It’s a great way for hosts to meet people from around the world and for visitors to have a more local and comfortable experience. There can be financial benefits on both sides too, as hosts earn money on their empty rooms and tenants save on lodging expenses.

Evolution of Airbnb

As with many tech businesses, this platform quickly evolved, leaving cities scrambling to catch up with these changing hospitality demographics. When hosts first signed up with the platform, there may not have been any short-term rental restrictions in their lease agreements. Even after leases were updated, many hosts continued to rent out their open space, trying to find ways around the lease terms. There was also a notable rise in investors buying properties for the sole purpose of running Airbnb businesses.

While hotels were certainly impacted by lost reservations revenue, cities also protested the rise of Airbnb. They were losing out on tax revenue and saw a correlation to a worsening housing shortage as investors took inventory off the market.

Latest Rules for Boston Short-term Rentals

After debating Airbnb’s presence in Boston through the spring, City Council finally set forth the following ruling:

  • Apartment tenants are not allowed to rent their apartment on a nightly basis
  • Airbnb investors are not allowed to rent their units on a nightly basis
  • Property owners are limited to listing one unit on the website
  • Airbnb is required to monitor their listings and ensure only legal properties are listed
  • Airbnb is required to collect and give user data to city officials

These regulations will, which apply to all short-term rental platforms, not just Airbnb, are scheduled to take effect on January 1, 2019.

Airbnb Claims New Law Violates State and Federal Laws

Airbnb sued the city on Tuesday, November 6, 2018, claiming that the parts of the law requiring Airbnb to police listings and share user data violate existing laws. They cited the federal Communications Decency Act, which states that online platforms which publish information provided by others cannot be penalized for this third-party content.

Their suit also protested the harsh penalties Airbnb will suffer if it does not successfully monitor its listings. The penalties include fines of $300-per-violation-per-day and even forbidding the company to operate in Boston.

Next Steps for Airbnb and Boston

The home-sharing platform is no stranger to lawsuits. Many cities have been passing new legislation, an act which Airbnb has often followed by suing the city. San Francisco and New York City, for example, passed laws similar to the pending legislation in Boston, and Airbnb sued both cities. The New York case is still pending. In San Francisco, however, Airbnb came to an agreement to collect and turn over user data, but it’s up to the city to enforce the laws.

It’s hard to tell how the Boston case will turn out. At the state level, there is interest in creating a statewide short-term rental registry that would help cities enforce local laws and hopefully stem the seemingly continuous spate of lawsuits filed by Airbnb against cities.

Arthur Hardy-Doubleday

Author Arthur Hardy-Doubleday

Arthur Hardy-Doubleday practices law in Cambridge and Martha's Vineyard Massachusetts. He works in the areas of Real Estate, Personal Injury, and Consumer Protection Law. When not practicing law, Arthur enjoys sailing, hanging out with friends on the beach, and waking his dog "Ridiculous."

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