New York’s new legislation targeting illegal short-term rental activity is slated to slash Airbnb’s New York booking revenue in half.
According to an article by Bloomberg, Airbnb and its users are on track to generate $140 million in booking revenue this year from which Airbnb takes a roughly 15% cut. But come January when the new legislation goes into effect, Airbnb and its New York hosts can kiss at least $70 million of that revenue goodbye.
That's a big number, but in the grand scheme of things, this is a relatively small loss for Airbnb. What could be truly catastrophic for the short-term rental industry is the precedent this legislation sets.
"Other cities will now see that data is the key to enforcement," Scott Shatford, CEO of hospitality analytics company AirDNA told Bloomberg.
"It's just a domino effect from here," he added.
New York’s legislation could provide the multifamily industry with the ammo it needs to win the short-term rental war.
Airbnb is taking this with a stiff upper lip, saying that it’s not afraid of New York.
"New York City is an outlier because the New York City Council is a wholly-owned subsidiary of the hotel industry, and they aren't interested in working together," Chris Lehane, Airbnb's head of global policy told Bloomberg.
Either way, grab your popcorn and soda, because this is bound to be one heck of a fight.