Airbnb Bill Proposed By DC Council

Washington DC can be one of the most challenging places for a property owner to become a landlord. 

New innovations that have come forth from the Internet are challenging those laws set forth by DC Housing. Landlords in DC are required to file for business licenses, maintain records if under rent control, have properties inspected, follow TOPA laws if they sell, and are subject to hefty fines if a tenant calls upon a DC tenant representative ( which is free for tenants ) if found in violation of something in the property that has not been attended to in a timely manner. Example would be a HVAC system not working and the landlord refusing to fix or replace. 

As Airbnb started making footsteps into DC not too long ago various issues have come forth.  Landlords and even tenants jumped on this opportunity to fill vacancies at premium profits for short-term periods of time. 

However there is a fine line in DC with landlord tenant law, and DC regulations onto what is considered a tenant, and what is considered a paying guest. There are rules regarding squatters rights, adverse possession, the exchange of money from "tenant" to landlord, and selling rights that tenants obtain during the process of sale.

Right now Airbnb and DC are trying to come up with a solution to minimize the landlord being able to take advantage of their hotel like system. From what I understand there have been landlords in DC that have multi- family buildings of 15-40 units that are border lining on running their building like a hotel. Using airbnb as its main source of guest traffic. Because they are not signing leases and just coming and going DC is concerned about the abuse of this process in the long run. It basically goes against everything DC landlord tenant law stands for. Landlords without a hotel licenses and or zoned as a hotel should not be able to rent out individual units on a ongoing basis for short term periods of time without a lease. 

The argument comes into play, as there are some management companies that specialize in short term corporate rentals. However those candidates are screened, have leases that are signed off, and are given the landlord tenant guidelines pamphlets when moving in. They have an understanding and expectations of the law from the start.

The bill that is being proposed is consisting of fines ranging from $1000-$7000 depending on how many times the landlord is not being compliant. Hotel owners in DC are also concerned as hotel bookings are down due to many using the airbnb platform. 

There are many challenges in a jurisdiction that is so heavily driven on landlord tenant rights. 

I have personally been asked by tenants to rent out space as a sublet by finding people on airbnb. The quick answer in my company is no. Until some actual rules, and laws are established in DC those that want to sublet must go through the approval process with our company. 

Airbnb is leaving a lot of openings for their customers to gain tenant rights in the District right now. 

For example. Lets say a tenanted property that has a group of 4 working professional’s needs to fill a room for the next month. During that month period the owner decides that he wants to sell the property un-expectantly. The tenants are on a month-to-month lease and the owner is going to follow TOPA laws with their agent.

However the owner of the property did not know that the tenants were secretly renting out a room in the property and profiting from it. With this scenario there are now two problems. The first being the tenants are in violation of the lease by profiting from renting out space in the owners property. Secondly depending on how long that new person has been living there they may have acquired some tenant rights. Length of stay and possible exchange of money can start that process of gaining tenants rights in DC.

Does the landlord now have to serve TOPA rights to the airbnb client? That’s the confusion at this point. Even if they did not serve that person rights under TOPA laws the actual tenants are allowed to sell their rights to a third party for as low as a penny if they want. So lets say 1 tenant out of the 4 sold their rights to the airbnb customer. Now you have 3 other tenants and one airbnb customer all with tenant rights for the sale of the property. As you can see this now creates a long and drawn out legal process for the landlord that can become very costly.

As there is no instant eviction in DC the tenants must stop profiting from the client of airbnb with a 30-day notice to cure or quite from an attorney. However that does not mean that person must move out. If that client was savvy enough and now has gained rights by the purchase of TOPA you now have a non paying new tenant with rights that can hold up a sale for up to 180 days if they wanted. 

Do I think airbnb is a good idea on paper? Yes as was Uber, and other .com ventures, however both take away from professionals like taxi drivers, and landlords that must spend thousands on licensing to be sought as legal under their state guidelines. So in states and jurisdictions where landlord tenants rights are prevalent I think there should be something that Airbnb should come up with along side  DC Housing to create a fair system. Right now Airbnb is not showing signs of doing that. 

For all questions please feel free to email at barry@bclmgt.com

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