SAN FRANCISCO—CBS News just reported that a “guest” ina San Francisco apartment, who was placed there by Air BnB hasrefused to leave the apartment and, it may take the tenant monthsand probably thousands of dollars to evict the squatter. Meanwhilethe New York courts have determined that a landlord cannot use alaw enacted last year to prevent apartments from being turned intohotel rooms, thereby enabling the existing tenant to utilize the services of Air BnB to make a profit on the apartmentthey rent. In New York there is also talk among members of the CityCouncil about enacting legislation to help renters defray the highliving cost by taking in paying “guests.” However, little is beingconsidered of the unintended consequences to both landlords andother residents in a building from tenants using services such asAir BnB.

First, there is the overriding security risk posed to both thetenant-host and the other residents from a stranger showing up witha suitcase and moving into a building for a night, a week or evenlonger. However, this risk also extends to the landlord if this“guest” turns out to be a criminal who robs the host or any of theother residents or causes bodily harm to any of the residents. Inthat event, the building tenants can and in many cases will sue thelandlord, claiming that the ownership failed to maintain a safeliving environment. The issue that is lost in attempts to protect atenant's right to profit on their rented apartment is that the“guest” is in fact a transient with little concern for the quietenjoyment of the other residents of the building or maintaining thequality of life or the appearance of the host's home or thebuilding. How then can the landlord and the other tenantsprotect themselves from the stranger in their midst?

Additionally, as the San Francisco tenant learned to her greatdismay: Once the “guest” arrives, there is no way to quickly getthem to leave. However, the other thing that tenants should, but donot, consider, is that they will have to pay tax on the rent moneythey earn; will be responsible to repair any damage to theapartment and perhaps, to the building caused by their “guest”;will have to obtain additional insurance in case the paying “guest”is injured in the home and not covered by the typical inexpensiverenters' insurance policy. Also, if the apartment is in acooperative or a condominium, New York City will be able to chargethe commercial transfer tax rather than the lower residentialtransfer tax when the host sells the apartment. As a result, thecost of housing the “guest” can exceed the revenue from the“guest.”