Can Short-Term Rental Arrangements Increase Home Values? A Case for AirBNB and Other Home Sharing Arrangements

The sharing economy or “new economy”1 has redefined consumption in the housing context in a manner that impacts traditional notions regarding home values and neighborhood integrity. Housing sharing allows owners to share some of the benefits of property ownership – namely use and enjoyment2 – while shifting some of the burdens of ownership – particularly, the economic burdens. With the advent of the sharing economy, there is a brewing conflict between this new economy and the realities of economic regulation. Thus, in the housing context, we see this conflict playing out in the tension between growing patterns of home sharing and existing regulations that prohibit such sharing. Many state and local governments, relying on their inherent police powers, regulate short-term housing. In particular, certain land use legislation overtly prohibits occupation by short-term renters. One prominent justification for such prohibitions is the maintenance of property values and neighborhood character

Airbnb and the Housing Segment of the Modern Sharing Economy: Are Short-Term Rental Restrictions an Unconstitutional Taking

The last few years have seen a reinvention of the economy through the growth of the sharing economy or the new economy. The sharing economy has redefined consumption in the housing context in a manner that implicates the exclusivity of the use and enjoyment of real property. However, there is a brewing conflict between this genesis and the realities of economic regulation. Recently, controversy erupted in New York after New York Attorney General Eric Schneiderman subpoenaed Airbnb\u27s records requesting data on its hosts for the previous three years. Schneiderman contended that Airbnb hosts in New York City were violating a New York law that requires that certain multiple dwellings units only be occupied by permanent occupants. This Article addresses the question of whether municipal restrictions on short-term leasing constitute unconstitutional takings of private property without just compensation. I contend that such facilitation is desirable because municipalities actually do themselves a disservice when they prohibit these new economy housing exchanges. Such exchanges can help to preserve property values by providing income to homeowners that can be used to offset mortgage and maintenance costs-in other words, sharing the burden of ownership. If homeowners are able to do so, they are more likely to be able to maintain their homes in the short-term and to maintain ownership in the long-term. Moreover, municipalities may also reap economic benefits from permitting such exchanges