- Real Estate
Washington, D.C. Attorney General and Council Oppose Short-Term Housing Rentals
Airbnb Creates Controversy
The Washington, D.C. attorney general sued a travel company in April 2017 that rents out homes as city lawmakers consider a proposal to severely limit the short-term rentals.
Attorney General Karl A. Racine says in his lawsuit against Ginosi USA Corp. that the short-term home rentals are forbidden under Washington’s Rental Housing Act. The Act says apartments cannot be converted into transient rentals.
California-based Ginosi USA rents out apartments to its travel customers in four apartment buildings in the Washington area. Two of them are rent-controlled.
City officials say the rentals drive up housing costs in the Washington area, thereby reducing the affordable housing available to working class residents.
Similar disputes are being confronted in cities nationwide, particularly against short-term home rental company Airbnb.
Racine’s lawsuit seeks an injunction against Ginosi USA, civil penalties of more than $1 million and back taxes for the rentals. The lawsuit says Ginosi USA charged tenants a 15.5 percent room tax but did not pay it to the city.
Racine filed the lawsuit just before the D.C. Council held a hearing on a bill that would limit property owners to renting no more than one housing unit at a time. The units would have to be in the permanent homes of the property owners.
The bill introduced by Councilmember Kenyan R. McDuffie (D-Ward 5) also would create a special business license for short-term rental landlords. Currently, they need only a basic business license.
Advocates for low-income residents, such as the Working Families Party, say Airbnb creates financial incentives for property owners to get rid of low-rent tenants and replace them with higher-paying short-term rentals in Adams Morgan, Columbia Heights and elsewhere.
Airbnb responded by releasing a study showing that its share of the rental market in the Washington area is too small to threaten the region’s affordable housing.
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