Controversial 'Airbnb law' approved by SF supervisors

San Francisco's Board of Supervisors has approved a controversial proposal that legalizes short-term rentals of private residences, clearing the way for online platforms such as Airbnb and VRBO to be used legally within the city.

Passed Tuesday evening by a board vote of 7 to 4, the so-called Airbnb law allows property owners and tenants to use websites to rent out their homes, apartments and rooms on a temporary basis. The law legalizes a practice that was already widespread in San Francisco but rarely prosecuted.

The law, which takes effect in February 2015, allows only permanent residents to offer short-term rentals and requires the collection of hotel taxes. Rentals will also be limited to 90 days out of the calendar year.

Previous San Francisco housing law prohibited most residential rentals of 30 days or fewer -- meaning the vast majority of Airbnb listings were banned. This was meant to protect renters, so that slumlords couldn't force them out to make a quick buck on vacation stays. Short-term rentals were also considered commercial businesses, which aren't allowed in residentially zoned locations. The intent is to safeguard these areas for housing.

Airbnb proponents say that short-term rentals bring many benefits to San Francisco residents and tourists. Not only do they help "home sharers" make ends meet or pay off their mortgages, they also bring more visitors who might not be able to afford the city's high-cost hotels. The average daily rate for a San Francisco hotel room is about $230 a night, according to an August study by hotel research firm STR Global. On most given days on Airbnb, hundreds of one-bedroom San Francisco apartments with a private bath can be found for less than $100 a night.

The San Francisco-based company counts a total of 350,000 Airbnb hosts and 550,000 listings all over the world. In San Francisco alone, its listings bring in 180,000 visitors that contribute millions of dollars to the local economy, according to Airbnb.

Prior to Tuesday's vote, opponents within the housing advocate community voiced concern that the legislation wasn't strict enough and said it should better protect affordable housing, residential zoning and landlords.

"We need to enforce the laws that are currently in the books," Janan New, executive director of the San Francisco Apartment Association, which represents landlords, told CNET in August. "If they change the rent law, they need to understand that impacts the whole rental system."

Airbnb representatives declined to comment on the vote.