One of the hot topics in New York City real estate is the popular website Airbnb.com. For the uninitiated, Airbnb seeks to provide tourists with an alternative to traditional hotels by allowing “hosts” of residential real estate (i.e., owners or tenants in possession) to list their residences for short-term rental. The site contains appealing pitches to both tourists and hosts. Airbnb invites tourists to enjoy “unique travel experiences” by staying in “an apartment for a night, a castle for a week, or a villa for a month,” and to do so “at any price point, in more than 34,000 cities and 190 countries.”1 For hosts, Airbnb offers the opportunity “to monetize their extra space and showcase it to an audience of millions.”2 The site affords hosts control over listing prices, allows them to screen potential guests, provides a platform for payment, and charges hosts only a three percent service fee when a reservation is confirmed.3
The appeal of Airbnb in a tourist haven such as New York City is easy to understand. From the traveler’s perspective, Airbnb provides advantageous pricing. For instance, a search on Airbnb.com for accommodations in New York City for the weekend of Friday, April 15, 2016 through Sunday, April 17, 2016 returned “300+ rentals” at an average price of $139 per night.4 By contrast, a search for New York City hotel rooms for the same dates on kayak.com revealed that even many two-star hotel rooms listed for well over $200 per night, with prices for better rooms increasing steeply from there.5
