Just 282 applications have been filed so far — meaning about 96 percent of all short-term rentals in the city are illegal today

 

More than 90 percent of these Airbnb listings are illegal
More than 90 percent of these Airbnb listings are illegal

By Tim Redmond

FEBRUARY 18, 2015 — Only a tiny fraction of the short-term rental operators in San Francisco have signed up to join the legal registry.

City Planning Department staff reported to me this week that 282 appointments have been scheduled between the Feb. 1 legalization date and the end of April. That’s about four percent of the existing Airbnb and VRBO units.

If hosts continue to sign up at this rate, it would take six years for all of the estimated 6,200 units in town to become legal.

It also means that 96 percent of all the short-term rentals currently operating in San Francisco are illegal.

According to the City Planning Department website:

You may not rent your unit (in all or a portion) as a short-term residential rental until you have received a Short-Term Residential Rental Registration number from the Planning Department.

Some of the backlog is simply due to the staffing limitations of the Planning Department – a sign that critics had a point when they said that the legalization would tax existing resources and that the rules would be almost impossible to enforcement. 

The department requires all would-be Airbnb hosts to provide a valid business license from the Treasurer’s Office, proof of $500,000 in liability insurance, and proof that the place for rent is actually the hosts primary residence.

Each person can register only one unit.

It’s clear that many of the existing rentals aren’t primary residences. In New York, for example, this nifty little tool lets you check on Airbnb rentals shows, one third of all listings come from hosts with multiple units.

If that’s the same pattern in San Francisco, then about 2,000 Airbnb listings will never be in compliance with city law. That’s a lot of units, and so far, I’m not seeing any signs that the number of available Airbnb rentals has dropped by one-third in the past few weeks. “Actually, the numbers are up,” Dale Carlson, who is working with a group that wants to better regulate short-term rentals, told me.

Which raises two questions: If a new law is passed and nobody decides to use it, was the law worth anything in the first place?

And now that it’s clear which units are legal and which aren’t legal, when will the city start enforcing the rules and shutting down the illegal ones?

Again, by the city’s own rules and statements, nobody can rent out a short-term unit without a permit. There are fewer than 300 appointments so far, which means only a handful of permits have been issued.

Go to Airbnb.com and look up San Francisco. There are thousands of places listed for rent.

I can see the Planning Department, overwhelmed with applications, giving amnesty to anyone who has actually filled out the paperwork and asked for an appointment.  Gina Simi at planning notes:

it’s still very early.  At this time we’re focused on efficiently implementing the application process for the residents who make an appointment and have been successful in doing so since the ordinance went into effect.  We’re strongly encouraging residents to visit our website (www.sf-planning.org/shorttermrentals) to familiarize themselves with the conditions and information they need to provide before they call to schedule an appointment.

But that website says you can’t rent your place without a permit. What about those thousands that are on the market today whose owners or tenants have made no effort to comply with the law?

Portland, Oregon, passed an Airbnb legalization law last summer. But almost nobody there has signed up for permits, either. And now (unlike San Francisco) Portland has moved to fine the hosting platform –that’s Airbnb — $500 a day for every listing that doesn’t show a permit number.

If San Francisco doesn’t do something like that, will we have to wait six years for the company to follow the rules?

Maybe not: Carlson said that a ballot initiative for the fall is pretty much 100 percent. “We’re going,” he said.

 

  • Start by boarding up all the non-complying properties. Charge Air BnB for the manpower and the materials to do it.

    • Guest

      Since the left apparently believes that building new homes increases the cost of housing, it is logical that reducing the number of homes in SF will reduce the cost of homes.

      You are a genius, sir.

  • W.C. Whiner

    100% of short-term rentals were illegal before the law passed. 4% is a start.

    Why would you bother with a ballot-measure fight about this one? I mean, sure, it’s less of a rounding error than Ellis Act evictions, but still: it’s a big rounding error, instead of a small one. The real problem is that the city is woefully behind on building housing, full stop.

    When people need housing, build more.

    • Guest

      Boosters who call for building housing at all costs claim that to do otherwise would be to cast San Francisco in amber to turn it into a non-working museum city like Venice.

      AirBnb is what is colonizing the Victorian Belt, replacing rental housing with short-term rentals. Why build more housing if it is just going to get converted into hotels? Who wants existing residential neighborhoods to be converted into hotel zones?

      • W.C. Whiner

        Leaving aside the ‘at all costs’ crack, simple math tells the tale. From 2005 to 2013, per the American Community Survey, total housing unites were up 26,000, while units for seasonal, recreational, or occasional use barely budged. Videlicet:
        https://www.dropbox.com/s/xqgqbhbozmuu58z/ACS%20unit%20growth%202006-2013.png

        We build more housing because people need places to live. Housing units are not being converted to hotels in sufficient numbers to show up in the Census Department surveys, and they know their stuff.

        Please, always run the numbers. It’s helpful.

        • Guest

          AirBnB is new and is industrializing the industry of short term rentals in local markets. When the City fails to enforce the law, then the green light will be flashing encouraging prospectors to strip mine our residential neighborhoods.

          Nobody wants residential neighborhoods converted into hotel zones.

          • W.C. Whiner

            Dude, man, choose life.

          • Guest

            If the city hadn’t made long-term letting so unattractive, this would not be a problem.

            Many property owners choose Airbnb because the alternative is dealing with rent control. The city has brought this problem onto itself by punishing those who offer housing services. And their solution appears to be punish them some more. Good luck with that.

          • W.C. Whiner

            That’s plain, simple regulatory arbitrage. Long-term letting is immensely profitable even with rent control, but it’s more profitable without. People will break rules that cost them money if there is no enforcement.

          • Guest

            WC, as a (mostly) former long-term landlord who now does (mostly) short-term lets, I can tell you that short-term letss are not more profitable when you take into account void periods, turnover expenses etc.

            It is more work for about the same money.

            So why did I switch? So that I could retain control over my building, quit at any point, and know that I’d have vacant units.

            It’s about control, not money.

          • W.C. Whiner

            The arbitrage is with controlled units, and from prior postings I recall that you own non-controlled units. The situation is entirely different then.

          • Guest

            WC, I have owned both controlled and non-controlled units.

            The incentive to go the Airbnb route is almost exclusively for controlled units.

          • W.C. Whiner

            ..which means it’s still about money, in the form of terminal value. Vacant, controlled units are worth much more when you sell than occupied ones.

          • Guest

            To some extent, WC, but it’s not about immediate profit. It’s about taking a long-term view about the value and utility of your property, and taking into account both the monetary and personal value of not having someone living there who you cannot get rid of.

            As a landlord of many years, I can tell you that it is the lack of control, rather than the lack of income, that causes landlords to avoid rent control.

            And if you look at most of the changes in the law over the last 10 to 15 years, they are not about reducing rents but about trying to close loopholes. At this point, rent control is a legislative monster chasing its own tail.

          • W.C. Whiner

            Yes, terminal value is not about immediate profit. It’s still about money. The twenty-plus-year obligation to accept below-market rent is the issue.

            Rent control is one leg of a three legged stool, where the other two stools are missing. The missing stools are tax on luxury apartments and public building.

          • Guest

            As I explained, it’s about control as well. How would you feel if there was someone in your home and you could not get rid of them?

            The city tried public housing and it was and is a disaster.

            There are plenty of taxes and fees on new development, most of which is not “luxury”.

      • medalist

        It’s almost entirely rent controlled housing stock that’s being used short term. New housing you can raise rent to meet the market. Stabilizing Rent Control to entice owners back into the long term market would have the effect you desire.

        • Sam

          Absolutely. You see this most critically where someone owns both controlled and uncontrolled units, as I do.

          Then it makes far more sense to rent out the uncontrolled units long-term, while living in one of your controlled units, and renting out short-term any other controlled units.

          You can always tell bad policy when it induces people to behave in odd, strange un-natural ways. And so it is with SF’s housing policy which incentivizes living in a rental unit while you rent out your primary home.

    • Runforthehills

      Not according to Campos. That pandering fool is going to try and put a moratorium on building in the Mission.

      • SFrentier

        Limit supply. I actually like that. Another way to increase the value of my Mission RE investments. Good going Campos 🙂

        • Guest

          When marcos and SFRentier agree with each other, you know something has gone horribly wrong

  • Mariachi

    That map is pretty questionable. Leaving aside all the spots in the water (could be houseboats, although you’d think you might notice the one moored in a shipping lane under the Bay Bridge,) GG and McLaren parks? The eastern ass-end of Chavez? India Basin industrial park?

    • Dave

      I’m more interested in the toll booths at the Golden Gate Bridge….how can I find that listing on Airbnb?

      • Y

        I believe all the locations on the map have been shifted randomly by a little bit, so that you can’t identify any particular location.

        • jjfieber

          True. I made the map. The locations are self reported by airbnb’s hosts and not accurate enough that they could be found. The platform wants to protect its profits afterall, illegal or not.

          • Guest

            You don’t respect the privacy of SF residents, Jennifer?

    • Guest

      Another problem with the map is that it assumes that all lets through Airbnb are short-term. But the new law doesn’t apply to rentals of over 30 days even if it is made through Airbnb. Nor is any hotel tax due in those cases.

      There is a significant demand for “medium term” rentals (say one to six months) and Airbnb is a good way to locate them. In theory they would fall under rent control but in practice that risk is minimal, say, if you only rent to visiting foreigners on temporary work assignments,

  • phil

    Anyone know how to report non-compliant airbnb’s in their neighborhood?

    • SFrentier

      Dick.

    • Guest

      Anyone know how to report tenants who are doing Airbnb to their landlords, so that they can be evicted?

  • Dave

    Tim fabricated this part:

    “Portland has moved to fine the hosting platform –that’s Airbnb — $500 a day for every listing that doesn’t show a permit number.”

    Here is what the article he links to actually says:

    “The ordinance gives the city authority to fine hosts and companies up to $500 per property that’s not in compliance, Lannom said.”

    So they have the potential to levy fines against the hosts and the web companies, but Tim’s statement that Portland is actively moving to the fine the web platform is something that he made up.

  • SFrentier

    That’s because this big brother crap registration is largely unenforceable (except fo dicks like Phil above that want to nark you out.) So smartly, just about every airbnb host is giving THE BIG MIDDLE FINGER to SF’s Bored of Stupes legislation. It’s a mockery, and everyone knows it.

    • Guest

      It’s weird. Tim says he hates this new bill and yet he is now complaining that Airbnb hosts hate the bill and its provisions.

      So is Tim saying that he now supports the bill? If not, why he is opposing civil disobedience by hosts against the bill? Surely he should support such protests and non-co-operation?

  • Guest

    I haven’t registered and have little intention to do so.

    “no laws have any validity or binding force, without the consent and approbation of the people” – Alexander Hamilton

    • Register My Ass

      Exactly. F*ck this law. I’ve been renting my home long before there was AirBnb and will continue to do so in private.

      • Guest

        Yep, I was doing short-term lets through CraigsList eighteen years ago, and via the newspaper before than.

        The lefties are so consumed with hatred about Airbnb they do not realize that many more of us do this off the grid, and this registration deal is looking in the wrong place.

  • Guest

    No one’s goingn to register & btw, there’s someone here who points to the Paris example, and Gary points to the Spain example, both of which are noisy about fines but France is going to vote out the socialist asap, and Spain, who knows what will happen. The left is excited about Podemos but I doubt they will get elected.

  • Chris

    Just because a unit is listed on airbnb doesn’t mean it’s being rented. I have my home (in the east bay) on airbnb, as well as separate listings for my two guest rooms (which I also use to host visiting family & friends), and I only accept about half of the inquiries I get, which amounts to about 2 rentals a year for the house and about 1 rental a month for the guest rooms.

    So it’s at least possible that most of the listings in SF that would be illegal to rent are listings where the host is declining all inquiries until they get their permit, or old listings that the host is no longer actively renting. (I’m assuming that the law regulates renting, not advertising.)

    Also, note that although I am a host with three listings, they’re all for one house which I live in, so none of them indicate any loss of housing stock. So, Tim, I’d appreciate it if you would stop making the assumption that hosts with multiple listings represent rental housing that has been removed from the market.

  • Gerard Koskovich

    “Guest” who’s yammering about the Socialists getting voted out in France clearly doesn’t know much about French politics. The regulations around short-term rentals that ban Airbnb in Paris are municipal codes. The recently elected mayor of Paris is socialist — and the city council has a majority of Socialist, Green and other left party members. Whatever may happen at the level of presidential politics in France, elected officials in Paris are highly unlikely to give Airbnb a fee pass to transform significant parts of the rental housing stock in the city into hotel rooms.

    • Guest

      France also has a long proud history of evading taxes and ignoring their government.

      As does Greece, Spain and other so-called “socialist” places in Europe.

      It’s easy to support high taxes when you’re personally evading them

  • J.Carl

    So often when the city enacts a new law, they fail to embrace all the ramifications. Another example might be re-naming a street to honor someone. Besides street signs needing changing, there are map data bases, websites, stationery, business cards, phone books, google searches, on and on. Many people have two residences – under tax law both can be “principle” . There can be divorces, kids, ex-partners, and so on. How do you determine a breach of the law if a friend of a friend needs a place for few weeks when you are not using it? If they give you money to reimburse you for utilities, or a gift certificate for a restaurant is this rent? Do you need a permit? The real push behind this is the hotel lobby. They hate airbnb. Also the city losing the tax. But many people no longer want a hotel experience. They don’t want to be in an expensive tower downtown with no kitchen, no neighborhood. Some want to be in a home with a host. There are too many shades of grey for enforcement to be practical. The old systems simply resent the new changes that don’t serve them, but do serve a changing society.

    • Guest

      And many people believe, as I do, that the city has no damn business telling me who can be in my home and what arrangement they and I make. That is why I don’t register or pay the tax. It is a form of civil disobedience against an unjust law.

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