The New Orleans City Council recently approved a new rule on holding short-term rental platforms like Airbnb and VRBO accountable for ensuring the properties they list comply with local regulations.

New Electronic Verification System for STR Platforms

The idea is to eliminate booking opportunities for unpermitted rentals by forcing platforms to verify properties through a new electronic verification system. The law won't take effect until March 2025 to give the city's Department of Safety and Permits time to set up the system.

Council Vice President JP Morrell said the goal is to help the city finally crack down on illegal STRs, which far outnumber legal ones in the city, by preventing owners of illegal rentals from just relisting their property online after it gets taken down.

Although Mayor LaToya Cantrell's administration already has technology that automatically identifies unpermitted listings, which online platforms take down when notified. City Council member JP Morrell, who sponsored the new measure, said properties often quickly reappear on short term rental sites.

Ending the "Whack-a-Mole" of Illegal Listings

Morrell said. “The new system will be a game changer, because the whack-a-mole will end.”

Platforms will need to ensure properties are permitted as a short-term rental, bed and breakfast, hotel or timeshare before listing them for rent and verification will also be required at the time of booking.

Platforms that don’t verify their listings risk their own licenses to do business in New Orleans, although the rules don’t spell out specific consequences for failing to comply.

Following Other Cities' Lead

Other cities, notably New York City, have required that platforms restrict listings to properties registered with local authorities. A consequence has been that some landlords now advertise their properties on websites like Craigslist and Facebook, which don’t process transactions, according to Wired magazine.

Delayed Start to allow for Super Bowl and Carnival

However, the proposal won’t take effect until March 2025, after New Orleans hosts the Super Bowl and during the final weekend of Carnival season.

Morrell said the time is a reasonable date as it makes it feasibly for the city to have the technology in place.

Although, Morrell told Gambit back in July that he wanted to pass the measure before the end of the summer so that it could take effect before the Super Bowl. “We are going to see a complete explosion during Super Gras of illegal STRs, unless we get a handle on it well beforehand.” But even drafting it has taken longer than Morrell expected.

“It has taken us a long time to get to a position to craft this legislation, working with the city and the platforms themselves,” he said.

Consequences for Platforms That Don’t Comply

Under the proposal, STR platforms would have to verify a permit before allowing someone to book an STR. Plus, they’d have to ensure a property renewed its permit within two days of a permit expiring.

Come March, the city could start fining platforms $1,000 per illegal listing per day.

As the March 2025 implementation date approaches, the question remains: will this new system be ready in time, or will unforeseen challenges require another postponement? Only time will tell if the city's efforts to regulate short-term rentals can meet the deadline. In the meantime, keep an eye on our website for the latest updates on short-term rental news, and be sure to check out the video coverage of this story on our YouTube channel.

Stay informed as the situation develops!