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Is Your Neighbor Running A Hotel?

It’s not a crazy as it sounds.  In fact with the summer vacation season looming and the economy still in the doldrums, it’s increasingly likely, all the more so because new and expanding platforms exist to help would-be hoteliers turn their apartments into cash – legally or not.

Tipped off by a law professor friend to The New York Review of Books, within a few minutes of perusing the classifieds, I had my choice of a co-op (yes, a co-op) at 200 West 54th Street, for $1,250/week (discounts available for longer stays). “What about the board?” I asked.  “No board approval,” came the response.

Or I could have had a loft-sized, antique-filled flat near Morningside Heights, thanks to a Columbia University faculty member, who was fleeing her subsidized housing for a few months and for “the right person” the price was negotiable. “What about the landlord?” I asked. “It’s between us.” So what are a few underground apartment transactions between the cash-strapped intelligentsia? 

Only now turning individual apartments into hotels has gone above ground in a big way. Log onto airbnb, one of the newest entries, and you’ll find close to 2,500 listings for New York City. They range from a couch in someone’s living room to a terraced penthouse overlooking the Hudson, in any part of the City from Brooklyn Heights to Harlem,  Greenwich Village to Carnegie Hill. There are lots of photos, plenty of rave reviews, a few complaints about dirty mattresses, but not a single identifying building address, which according to one poster, are blocked by the site until a contract is signed.

I inquired about a two bedroom in a prime location, and promptly got an email from the lister telling me the rate for what was her personal apartment was $299 per night, plus $65 cleaning fee; doorman – no, elevator – yes. The purveyor of the sunny doorman studio near the U.N. told me she lived next door and would meet me with the keys. The St. Marks Place one bedroom was being offered by “Hotel Toshi,” an enterprise that claims to have more than 84 apartments, and warns you since its rooms are in residential buildings, it’s responsible for the unit, not the neighbors.

All communications and cash go through the site. You can pay by credit card or Paypal, and the site doesn’t release the money till a day after your arrival, though some hosts require upfront cash security deposits of hundreds of dollars. The presentation is so sleekly professional, you almost think you’re checking into a real hotel.

At Home Away, there were 853 listings for the City the day I checked, and more available on its sister site, vrbo (vacation rentals by owner. I had my choice of a co-op at 11 East 32nd Street, for $235 per night, or $5,379 for 21 nights, including 9% tax, no extra charge for a child,   Here you have to contact and pay the owner directly, usually thirty days in advance, plus cleaning fees and taxes ranging anywhere from 9 to 15%. Insurance protection is available from the site for a fee in case the accommodations don’t measure up.

Want a place to stay on the cheap? Try hostels.com.  Or maybe you’re a business traveler looking for something more upscale. There are corporate housing sites galore: new york city corporate housing, furnished dwellings, Churchill corporate housing, and plenty more.  

Then, of course, there’s the Grand Daddy of them all, Craigslist – a veritable Wild West of apartments available for one night and more, offered by individuals and enterprising entrepreneurs. The supply is seemingly endless.

What I wanted to know was how renting out your apartment by the night could be legal? Short answer: It’s not. Then how come the practice is proliferating right under the noses of the regulating authorities?

It comes down to the numbers. Despite their increasing visibility, apartment hotel rentals by individuals comprise a small part of the total illegal hotel market, according to Eliyanna Kaiser, Chief of Staff to NYS Assemblyman Micah Kellner. 

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One Response to “Is Your Neighbor Running A Hotel?”

  1. DavidG says:

    The sponsor, in our building since 1986, who still owns 60% of the building today, is using several apartments for student housing “Dorms”, I am not sure the legality, but it has no place in a residential co-op building – clearly against the prop lease.
    As a new board member it’s been very tiring dealing with shareholder complaints around this issue. We are devising additional action plans, but the sponsor is not budging to complaints in writing or verbally, good to know that the sponsor and managing agent are the same and neither uses email.
    Happy Days, we keep on moving forward to raise our building standards.

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