Judge: NYC Airbnb stay illegal

There's more bad news for the sharing economy coming out of New York City. After the car-sharing service RelayRides recieved a cease-and-desist letter and halted its New York City services last week, Airbnb, the short-term room rental service and hotel disruptor, is also facing legal problems.

CNET is reporting a New York judge ruled that a man who rented out his room on Airbnb did so illegally. He was fined $2,400 for breaking New York City's illegal hotel law.

This hardly comes as a surprise as Airbnb's legality has been questioned in New York and other cities through the U.S., including its hometown San Francisco. Earlier this year travel website SKIFT estimated that more than half of the New York City rentals on Airbnb were illegal. CNET explains the law:

The New York case is centered around a 2011 law that makes it illegal for New York residents to rent out a property for less than 29 days. It was originally aimed at landlords who bought up residential properties and turned them into hotels. Airbnb has been lobbying legislators to change the law so it clearly protects hosts, like Warren, who are not trying to turn their homes into hotels.

With sharing services, like Airbnb and RelayRides, growing in popularity it's clear there's a substantial market for these services. What's not clear is whether cities and their laws are, or ever will be, open for these businesses.

NY official: Airbnb stay illegal; host fined $2,400 [CNET]

This post was originally published on Smartplanet.com