Summary:
NYC's Local Law 18 has prompted Airbnb to remove thousands of listings, leading to an underground rental market.
Private invite-only groups are thriving on social media, providing alternatives for short-term rentals.
Ohana, a startup focused on rentals longer than 30 days, has raised $3 million to expand its operations.
Competition is fierce, with startups like hostU and Furnished Finder capitalizing on the changing landscape.
Criticism arises as startups are accused of disrupting community-driven rental groups.
A year-old crackdown on Airbnb in New York City has given rise to a booming underground market for apartment rentals, with innovative startups emerging to capitalize on the situation.
The Impact of Local Law 18
Last fall, the New York City Council enacted Local Law 18, imposing stringent regulations on home-sharing, which led to Airbnb removing thousands of listings from its platform. Hosts are now subject to complicated registration processes and must be present during guest stays unless rentals exceed 30 days.
The Rise of Underground Groups
In response, private invite-only groups have proliferated on platforms like Facebook, Instagram, WhatsApp, and Craigslist, featuring names such as “Friendbnb” and “Gypsy Housing NYC.” These groups often charge fees through apps like Venmo or PayPal. One group, “NYC Short Term Sublets,” has gained over 17,300 members and posted 630 listings in just one month.
Startups on the Scene
Among the startups thriving in this environment is Ohana, based in a loft at the renovated Domino Sugar Factory in Brooklyn. Founded by Jacob Halbert and Ezra Gershanok, Ohana focuses on rentals longer than 30 days and has aggressively recruited hosts, amassing over 1,200 from Airbnb alone. They recently raised $3 million from prominent investors, including former Airbnb executives.
Ohana’s offices are in the former Domino Sugar factory in Williamsburg.
Competition and Controversy
Ohana's tactics have drawn criticism, with some groups accusing them of infiltrating and disrupting community listings. For instance, Ricky Berrin, founder of the NYC Home Sharing group, has publicly called out Ohana for their aggressive recruitment strategies.
New Entrants and Market Growth
Another startup, hostU, launched by Bella Le Sage, focuses on connecting students to housing and has recently expanded into NYC. Furnished Finder, a Texas-based company, has also seen significant growth in demand since the new regulations, confirming that many former Airbnb hosts are now listing on their platform.
Bella Le Sage is a student at Northwestern University and launched a home-sharing site for students, hostU last year.
Comments