Jersey City Voters to Decide on Imposing New Restrictions to Rein in Airbnb Rentals

Residents of New Jersey's second-largest city will decide Tuesday whether its increasing popularity as an affordable short-term rental option across the river from New York City has reached the point where restrictions are needed to rein in some of the unwanted byproducts.

Jersey City residents will vote on whether to approve restrictions on short-term rental companies like Airbnb, in a referendum that has prompted a barrage of television ads and leafletting in recent weeks.

On one side are city officials who say the short-term rental market has become dominated by absentee owners turning multiple properties into de facto hotels and creating a shortage of affordable housing. On the other is Airbnb and its hosts who say their livelihood will be threatened by the new rules. Both sides accuse each other of spreading misinformation about the size of the market and what effect the new rules will have.

It's a battle that has played out in numerous American cities, including San Francisco, where Airbnb is based.

Jersey City's referendum comes roughly four years after officials gave Airbnb permission to operate in the city. Since then, short-term rentals have increased, partly fueled by New York City's crackdown on the practice. That hasn't set well with everyone.

"What we've seen happen is people buying up two-, three- and four-family brownstones and basically turning them into hotels," said Corey Klein, an attorney and board member of a neighborhood association located in downtown Jersey City, near the Holland Tunnel into New York. "The point we're making is those are units that are off the market. So rental prices go up, and there are less for local families."

In the spring, Jersey City's council approved rules that would prohibit renters from sharing their homes, limit how often a home could be rented and forbid short-term rentals in buildings with more than four units. Airbnb says those restrictions will apply to more than 90% of the city's properties and will disproportionately affect renters, most of whom are minorities.

"That's a huge swath of the population that will be cut out of an economic opportunity," said Airbnb spokeswoman Liz DeBold Fusco, adding that "thousands of residents may be in serious financial jeopardy, with some even at risk of foreclosure or bankruptcy" if the rules go into effect.

Jersey City Mayor Steven Fulop said the short-term rental market has changed dramatically in the last few years, bringing in more absentee owners and creating more nuisances. He said the new regulations are fair and modeled on approaches used by other cities.

"Put yourself in a high-rise building where you pay rent, you have a doorman and security and you've gone through a background check," he said. "And your neighbor is listing his apartment on Airbnb and every day a new person is coming in there. What does that do for quality of life?"

Anand Jagadeesan, a 20-year Jersey City resident who has rented out two houses he owns for about three years, said the 60-day yearly limit on rentals will greatly affect him. He also said the city had provisions in its original legislation in 2015 against absentee landlords with multiple properties.

"The problems they're highlighting now are because they're not enforcing their own legislation," he said.