The New York City Economy Tracker is a joint project between Investopedia and , using publicly available data to eva෴luate the economic health of the city across a variety of metrics.

ඣ For the week of September 18, 2023, we’re looking at how new regulations have impacted short-term rentals across New York City.

Short-Term Rentals Dry Up In New York City

Short-term rentals have decreased across New York City as the Mayor’s Office cracks down on landlords. As of September 5th, New York City landlords with short-term rentals on hosting platforms such as Airbnb, VRBO, Booking.com, and others are required to register with the Mayor’s Office of Special Enforcement (OSE) and be present during guest stays.

 The Short-Term Rental Registration Law has been a major shakeup in the city’s short-term lodging industry. In June, Airbnb filed a suit against New York City to block implementation of the law, but it was dismissed by a New York Supreme Court Judge.

According to data from the watchdog group, Inside Airbnb, the number of listings on Airbnb for less than 30 days in New York City have plummeted in response to enforcement of Local Law 18 from 21,785 in August to only 6,841 in September. At the same time, the number of listings on Airbnb with a minimum night availability over 30 days rose from 21,797 to 32,612 during the same time period.

Many of the listings have been altered either by the hosts or Airbnb itself in response to the legislation’s enforcement. However, some short-term listings have been removed from the platform entirely between August and September 2023.

Neighborhoods Around Downtown Brooklyn See ⛦La♐rgest Decline

With the new regulations, neighborhoods around downtown Brooklyn saw the largest declines in Airbnb short-term rentals from August to September. Four of the five neighborhoods with the largest drop in short-term rentals in that time period were🐻 in Brooklyn, with three in downtown Brooklyn: Cobble Hill with a 95% decline, Brooklyn Heights with a 93% decline, and Carroll Ga🎃rdens with a 92% decline. 

Many of the neighborhoods with the highest decline in short-term rental availability in Brooklyn and Queens were some of the same neighborhoods with the highest rent costs. The city’s Office of Special Enforcement (OSE), which is overseeing the implementation of the new law, has stated the diminishing stock of available housing as one of the main reasons for Local Law 18, along with potential safety hazards and noise and litter complaints that accompany short-term rentals.

According to Christian Klossner, Executive Director of the OSE, the city reviewed 1,031 out of 4.266 short-term rental applications it received, and only granted 329 of those as of September 11, 2023.

Entire Apartment Short-Term Listings Were a Third of Airbnb Ma🍌rket

Local Law 18 was designed to target listings available for less than 30 days that included the entire apartment or home due to their high likelihood that the landlord was not present on the property. According to Inside Airbnb data💎, these listings were a major proportion of Airbnb’s business in New York City and before September of 2023, typically accounted for about a third of all listings on the platform.

While Local Law 18 has definitely had an impact on the availability of short-term rentals on platforms like Airbnb in New York City, it remains to🐼 be seen whether it will have any effect on either 🎀the hotel industry or the city’s housing market.

Currently, according to data from the Times Square Alliance, while the hotel occupancy rate in Manhattan is up to 85% as of July '23 compared to 75.6% in July of last year, it is still below the 90% occupancy rate from July of 2019.

 Additionally, as of August '23, NYC rental availability is up to about 39,300 units compared to 34,056 in August of last year according to data from StreetEasy. However, this number is still notably lower than the 42,357 available units in August of 2019.

 Substantial increases in either rental or hotel availability would have to occur to determine if Local Law 18 will actually return them to pre-pandemic levelಞs, much less above them.