Airbnb has decided to drop their lawsuit against the City of New York, the largest market for its operations with revenues exceeding 1 billion dollars in the city for its hosts.  Airbnb has had a huge impact on business specifically in Manhattan and Brooklyn.  The lawsuit was based on a law signed in October that called for fines of as much as $7,500 for illegally listing a property on rental platforms such as Airbnb.  The law would have imposed fines that would have hampered Airbnb's operations throughout the country and required additional supervision of listings being put on their website.  The lawsuit was dismissed on the agreement that New York City enforce the law only against hosts and Airbnb not be fined.  The settlement of the lawsuit goes into effect today December 5, 2016.   For more about the settlement you can read here.

NYC property management companies have vehemently objected to Airbnb taken hold in New York City. Specifically some landlords have been fined and violations imposed as a result of tenants illegally renting out their apartments to Airbnb'ers.  A recent case brought by Related exemplifies this.  In the particular instance, Related attempted to evict a rent-stabilized tenant who they discovered was renting the unit out on Airbnb for $649.00 per night.  The tenant was paying $6,670 for the unit on the market rent of $9,000.  Related sought and received an eviction.  The state appeals court held that tenants have no right to benefit from apartments that have rent restrictions.

Although there are no guarantees that this would stop illegal units cropping up throughout the city, it is certainly a positive step into deterring possible violators.  It will be interesting how the City will go about enforcing the law going forward but Assemblywoman Linda Rosenthal is optimistic that there will be a crackdown.   She states “I expect the city will now get down to the important business of enforcing the law against the serial lawbreakers on the site” who turn affordable housing intol illegal hotes. This is a win for everyone."

http://www.blueharbourpropertymanagement.com/airbnb-drops-suit-city-hosts-will-fined-instead/

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421-a Tax Abatements are Being Revoked on Landlords in Non-Compliance

The crackdown on Landlords who are not registering their buildings with the city's rent regulation has swiftly come down on owners of buildings in New York City.  A new report by Crain's New York Business indicates that the city along with the Attorney General's office, Governor Cuomo and Mayor DeBlasio's office warned owners of 178 buildings that they must register the 1,400 affected apartments with the city's housing agency which will enforce rent limits each year.  The failure to register their buildings will result in the 421-a tax designation that the owners have on their buildings to be removed and the owners being responsible for the reinstated taxes for the period that they received the abatement by the city.

421-a  is a program gives developers a 10 year tax exemption for building a multi-unit residential project on vacant land.  The developer of a project on vacant or mostly vacant land is exempt from paying the taxes it would usually have to pay for a 3 year period of construction. Thereafter the developer is given a  10-year-long exemption period, during which the exemption becomes more of an abatement. Every two years during that period, the tax break is reduced by 20%, until fully used.

It is further reported that since 2014, the Attorney General's office under the Real Estate Tax Compliance Program  have caught more than 460 landlords in noncompliance, revoking the tax break at 35 buildings and sending notices of revocation to 178 more.  For more information on the report click here.

As a New York City property management company it is imperative to be in compliance and up to date with the city's reporting and enrolling of apartment units.  The failure to do so, as you can see for some landlords can result in potentially millions of dollars in losses that could have been prevented by having safeguards set up with respect to reporting.  At Blue Harbour Property Management we set deadlines on reporting and enrolling apartments with the City.  That way, we never have to worry about exorbitant that could be detrimental to the entire development and overall health of the building.  This is part of building management expertise that a landlord should look for in deciding on a apartment management company in New York City.

http://www.blueharbourpropertymanagement.com/421-tax-abatements-revoked-landlords-non-compliance/

Visit us at www.blueharbourpropertymanagement.com