Hotel room or Airbnb let? The hotel industry takes note


Last year's Upper Tribunal case between Iveta Nemcova and Fairfield Rents Limited reminded leasehold flat owners who rent out their homes via Airbnb to check that doing so will not be in breach of the commonly found lease covenant to use the demised premises as a private residence only.  The leasehold flat owner had used the flat for short-term lettings which she advertised on the Internet.  The Upper Tribunal decided that the short term lettings were not compatible with the degree of permanence required for use as a home.  

A recent article in The New York Times reports that in the US, the hotel association has a plan initiated in 2016 to combat the impact of Airbnb on its business.  In the US, the hotel industry is increasingly lobbying politicians and attorneys to draw their attention to how Airbnb hosts may operate hotel type-businesses below the radar and not collect hotel taxes for example nor comply with the same regulations to which hotels are subject.

All of this should remind Airbnb hosts to reflect on the legal implications for them in continuing to let out their properties with the Airbnb model.

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The short-term rental company became a Federal Trade Commission target last summer after three senators asked for an investigation into how companies like Airbnb affect soaring housing costs. In October, Gov. Andrew M. Cuomo of New York signed a bill imposing steep fines on Airbnb hosts who break local housing rules. The two actions appeared unrelated. But one group quietly took credit for both: the hotel industry. In a presentation in November, the American Hotel and Lodging Association, a trade group that counts Marriott International, Hilton Worldwide and Hyatt Hotels as members, said the federal investigation and the New York bill were “notable accomplishments.” Both were partly the result of a previously unreported plan that the hotel association started in early 2016 to thwart Airbnb.
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