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Private investigators are making bank catching illegal Airbnb hosts

(BUSINESS NEWS) With rents sharply rising, it’s not hard to see why so many people are tempted to illegally rent out their spaces on Airbnb.

private investigators airbnb

What’cha gonna do?

Risk versus reward: it’s the classic conundrum of the businessman. How much risk is acceptable, and how great are the rewards that can be realized?

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In large cities across the United States and around the globe, landlords are undertaking that calculus, even when it may run afoul of the law. The risks are that they will be caught violating local or state laws prohibiting the eviction of renters to turn what used to be a great apartment into the next hot Airbnb rental.

For other landlords, they gamble that no one will notice that they’ve bought up properties in desired locations around the city, routinely exceeding local restrictions on the number of nights that a property can be used as a short term rental.

Private eyes, they’re watching you

Landlords’ decisions to gamble on Airbnb legalities have created a new cottage industry: the real-estate private investigator. Private investigators are tasked to spy not on people, per se, but on property. Watching vacationers enter and leave a recently vacated apartment, investigators attempt to prove their plaintiffs were evicted illegally. San Francisco law prohibits evictions solely for the purpose of converting the property into a short-term rental, such as is common with Airbnb.

That such a case would manifest itself in San Francisco is not surprising. The city has become a flashpoint in discussions about gentrification and a lack of affordable housing in the city. With rents skyrocketing in recent years, the city has just now seen stabilization in market prices for one-bedroom apartment rentals.

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In 2016, rent prices in San Francisco actually dipped by 1.2 percent over 2015 rates. But with a median rent for a one-bedroom apartment in the city coming in at $3,343, it’s not hard to see why so many apartment owners would be tempted to convert their holding to a short-term rental sites like Airbnb.

For their part, Airbnb contends that they haven’t affected the housing market for those in the middle and lower income brackets. Instead, they point their fingers at local building restrictions that prevent new construction from starting, with increased demand coming from the lack of supply. However, they are taking steps to partner with local officials to ensure that they are complaint with local laws.

One host, one home

In November, Airbnb began a policy in San Francisco that established a “one host, one home” requirement. The purpose is to drive out investors looking to acquire apartments to turn into Airbnb rentals, rather than homeowners looking to supplement their incomes by leasing out their own property.

The same policy now exists in New York City, which has seen many of the same problems with the affordable housing market that San Francisco has seen. An economic impact study conducted in New York found that in Manhattan’s Soho/Greenwich Village neighborhoods, a short-term rental exceeds a longer rental’s value by nearly $10,000 annually.

“We strongly oppose illegal hotels and bad actors who remove housing from the market,” said company spokesman Nick Papas, speaking to Bloomberg. “We’ve removed thousands of listings from our platform that aren’t right for our community. We are committed to working with cities to address their specific needs.”

Private investigators now fill the gaps when Airbnb or local enforcement officials are unable to monitor rental compliance.

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They are trying to provide protection to those who may be otherwise at the mercy of their landlords, turning what was once their homes into a trendy nightspot for tourists.

Unfortunately for renters, investigators are finding themselves in a lucrative market.

#AirBnBusted

Written By

Roger is a Staff Writer at The American Genius and holds two Master's degrees, one in Education Leadership and another in Leadership Studies. In his spare time away from researching leadership retention and communication styles, he loves to watch baseball, especially the Red Sox!

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  1. Pingback: The CEO Scam is hitting businesses hard, how can your company protect itself? - The American Genius

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