More than 70 percent of Airbnb's short-term rental listings in San Francisco could soon be purged off the site following a settlement between the home-sharing company and its hometown.
Airbnb sued San Francisco in June to block the city from enacting tougher regulations that would slap home-sharing companies with pricey fines and possible criminal penalties if they post rental listings that aren’t registered with the city.
San Francisco is now claiming victory in that the settlement dismisses Airbnb's legal challenge to the city's short-term rules, thus, clearing the way for unregistered listings to be purged from home-sharing websites.
“We have successfully defended San Francisco’s common-sense regulations on short-term rentals,” City Attorney Dennis Herrera said in a statement. “This agreement helps protect the city’s precious housing supply by obligating these companies to ensure that all their listings are legal and properly registered."
As a result of the settlement, home-sharing companies Airbnb and HomeAway must require their users to provide proof they are properly registered with the city before allowing them to post their short-term rental listings online. The new requirement is scheduled to take effect by September, but current users will have until the start of 2018 to get into compliance.
"Similar to other agreements we have established with cities all around world, this agreement puts in place the systems and tools needed to help ensure our community is able to continue to share their homes," Airbnb said in a statement.
Airbnb and HomeAway also agree to cancel future stays and deactivate listings if notified by the city about unregistered hosts.
The settlement also allows Airbnb and HomeAway to offer its users a way to register with the city using their own websites.
Affordable housing advocates partly blame short-term rentals for driving up home prices in the city. Rental hosts, however, argue home-sharing helps residents afford to live in high-priced San Francisco.
Mayor Lee hopes that the new agreement will help the crack down on illegal hotels.
“This protects our rental housing stock while allowing residents who follow the rules to gain income to help make ends meet," Mayor Lee said in a statement.
"When platforms cooperate with the City to only list lawfully registered hosts, we can more effectively enforce our laws and protect our rental housing supply. This settlement is a significant leap forward for enforcement of our short-term rental laws."
The city’s attempt to crackdown on illegal listings followed an NBC Bay Area investigation in May that revealed thousands of short-term rental hosts in San Francisco continue to break the law by failing to complete the city’s required registration process.
City law defines a short-term rental as lasting 30 days or less. Since February 2015, San Francisco has required short-term rental hosts to register with the city and remain the primary resident of the home they plan to rent out.
Currently, 2,100 hosts are registered with the Office of Short-Term Rentals to legally rent out their homes. However, the Investigative Unit discovered Airbnb alone had 8,800 hosts listing its site as of late 2016. That means at least 76 percent of hosts in San Francisco appear to be breaking the law.
In June, one month after the Investigative Unit aired its original report, the San Francisco Board of Supervisors took steps to begin holding home-sharing companies accountable, including Airbnb, for any illegal short-term rentals they post on their websites. The change in law was scheduled to take effect in July 2016 and would have required home-sharing websites to verify that listings are registered with the city before posting them online. Otherwise, companies could face government issued penalties of up to $1,000 per day and potential criminal penalties.
The ordinance, however, never went into effect. The city held off on enacting the new law after Airbnb filed its lawsuit against San Francisco and requested a judge issue a preliminary injunction to halt the new enforcement process.