Illegal Short-Term Rental Conversions in San Francisco

Gamache et al. v. Airbnb Inc. (filed)
Plaintiffs v. Vbro.com and homeaway.com (pending)
Plaintiffs v. Flipkey.com (pending)

Background and Information

San Francisco lawyers filed the first ever lawsuit against Airbnb on behalf of tenants who have been damaged by the illegal conversion of residential housing. In the suit against Airbnb, Plaintiffs are tenants of a single residency hotel which has been converted from affordable housing into an unpermitted and unregulated tourist hotel. The Owners of the hotel use these websites to make a huge profit off the rentals. However, Hooshmand Law Group is preparing to file similar suits on behalf of tenants and apartment owners affected by these websites short term rentals.

The conversion of residential units into tourist or transient hotels has significantly contributed to the housing shortage in San Francisco. It is estimated that currently there are more than 6,000 residential properties currently rented in San Francisco for illegal short-term rental. The conversion of residential units in apartment buildings and neighborhoods has had an adverse impact on the other people who live in those apartment buildings and neighborhoods. Guests staying in the short-term rentals create significant additional amounts of foot traffic and security problems due to this increased foot traffic, and the extent of additional customers who are only staying for short stays can be noisy, inconsiderate, destructive, violent, and even dangerous to the people in the surrounding apartments and neighborhoods.

The conversion of residential units into short-term rentals, used primarily by tourists, has removed rent controlled apartments from use and caused residential rents in San Francisco to rise as thousands of residential units are no longer available to local tenants.

Airbnb makes its money by partnering with its hosts, and by taking a percentage of a guest’s booking fees and charging the Host a fee. The amounts vary depending on the amount of the rental. Airbnb actively attempts to make more money by increasing the number of Hosts and travelers and matching them with each other. Given the number of articles surrounding the illegality of Defendants activity, postings on its own website from users, and involvement in lawsuits on behalf of users, AirBnB is on notice that its business is illegal in San Francisco.

It is an unfair business practice to enable the rental of residential units as tourist units. Moreover, it is illegal to offer residential units for tourist use in violation of San Francisco law and it is false to advertise short-term rentals in San Francisco without stating that they are illegal. Following the suit against Airbnb, Hooshmand law will file suit against VBRO a subsidiary of Homeaway.com, who offers nearly identical, and equally illegal, services in San Francisco.

Mark Hooshmand, Tyson Redenbarger, and Stephanie Foster of the San Francisco law firm of Hooshmand Law Group, specialize in representing Tenants in civil actions. These two lawsuits seek to hold Airbnb, VRBO, and Homeaway liable for the impact they have on affordable housing as well as the damages they have caused renters in the San Francisco area due to their negligence and unfair business practices, as well as for their calculated conduct in attempting to persuade the city in condoning such action by manipulating the legislative process.

Attorney Tyson Redenbarger’s statement: “We believe this is the first lawsuit ever on this important issue. Airbnb is facilitating the short-term rental of rent-controlled units, thereby preventing the rental of those units to long-term tenants. This lawsuit will hopefully correct this issue and make available more units for long-term rental.”

Attorney Stephanie Foster’s statement: “San Francisco’s affordable housing crisis is forcing tenants literally into the streets. Companies like VRBO, FLIPKEY, and AIRBNB are not only taking advantage of the situation but violating local laws in the process. Our goal is to protect affordable housing and create legal and fair means for businesses like these to exist.”

We urge any other tenant in buildings with illegal conversions to come forward and contact the attorneys in this case.

Contacts:
Mark Hooshmand
Tyson Redenbarger
Stephanie Foster
Attorneys for the Plaintiffs

Hooshmand Law Group
22 Battery St., Ste. 610
San Francisco, CA 94111
Tel: (415) 318-5709
Fax: (415) 376-5897