East Hampton’s New Strategy Against Illegal Airbnb Rentals

A precedent-setting case unfolding in the Hamptons could affect Airbnb hosts across the East End.

East Hampton Town is considering using subpoenas against the rental company to uncover illegal short-term rentals in the area, 27East reported. The legality of such a move, however, isn’t clear yet.

Clarity could come soon, though. Last summer, the town subpoenaed Airbnb, demanding records for rentals of a Montauk home. The town discovered dozens of illegal rentals by the host, Harvey Elgart, who racked up more than $100,000 in revenue.

Elgart’s case is playing out in the courts. His legal team is challenging the validity of the subpoena, arguing that a town in New York can’t subpoena business records from a California company.

If the town wins, more subpoenas would surely follow. Town Supervisor Peter Van Scoyoc said they could become an “important tool” in enforcing East Hampton’s rental policy.

In East Hampton, property owners can rent their homes out for short-term stays — up to two weeks — twice a year. There is no limit on long-term leases. The policy aims to balance the needs of homeowners who need summer rental income with those who don’t want short-term renters wrecking the tranquility of Hamptons summers.

Until now, town inspectors have been knocking on doors and quizzing guests about the length of their stays. But hosts caught on, instructing guests to say they were members of the owner’s family, not renters.

Only eight hosts were cited this summer out of more than 300 who use Airbnb.

The subpoena strategy could be a problem for rental platforms, too. Outside of deterring hosts, it might lead to companies being found liable for facilitating the violation of local law, Van Scoyoc said.

Airbnb has been advocating for a statewide law that would legalize short-term rentals and provide tax revenue to localities. But such legislation has yet to come to a vote in Albany.

— Holden Walter-Warner