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Two airbnb hosts fined $60,000 each for illegal rentals in Singapore

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On 3rd April 2018, two Singaporean Airbnb hosts who provided Airbnb-style accommodation in a Bukit Timah condominium were fined $60,000 each for letting out apartments without official permission, the first of such case in Singapore under new rules against short-term rentals.

Photo credit: The Straits Times

Former property agents Terence Tan En Wei, 35, and Yao Songliang, 34, admitted to four charges in February and were fined $15,000 on each count.

This was the first case of prosecution for a breach of the Urban Redevelopment Authority’s (URA) rules on short-term rentals that kicked in on 15th May 2017.

According to court documents, both men earned at least $19,000 from four listings of their units at d’Leedon near Farrer Road over five weeks last year, between 15th May 2017 and 21st June 2017.

They also went further to set up several companies that were used to rent out the four units for short-term stays.

As former real estate agents, they should have the knowledge that short-term stays were illegal.

Since then, the men have had their licences revoked.

Tan and Yao also took precautionary and calculated measures to avoid detection, by taking their guests to a completely different unit to evade suspecting security guards. The guests were subsequently led to the correct unit after the guards left the compounds.

The prosecution had sought to fine each man a total of $80,000, while the defendants hoped to pay a maximum fine of $20,000 each.

District Judge Kenneth Choo said that while a $80,000 fine was too excessive, there were several aggravating factors. The men were profit-driven when they rented out these units on home-sharing portals such as Airbnb and Homeaway.

Judge Choo noted that the men were both first-time offenders, who pleaded guilty at the earliest possible opportunity, and cooperated fully with the authorities.

Ms Wong Soo Chih, the duo’s lawyer, said her clients were satisfied with the outcome. They paid the fine on the spot.

But Ms Wong noted that her clients could have been sentenced prematurely, given an upcoming public consultation on home-sharing rules. “While ignorance of the law is no excuse, to the layman, it sounds like the authorities are open to home-sharing,” she said.

The Government has said that a long-awaited consultation paper, that sets out a regulatory framework for short-term accommodation, will be released soon.

In a letter to The Straits Times Forum page earlier, URA’s group director for development control, Ms Goh Chin Chin, said that it would take some time to work through the consultation process and to amend legislation, if necessary.

In the meantime, home-sharing websites should “remind their users to comply with the existing laws” of a minimum stay of three months, she added.

A URA spokesman also said that it will continue to investigate any feedback received on illegal short-term accommodation, and work with management corporations and management agents to gather evidence.

“If investigations reveal that illegal short-term accommodation was operated on a commercial¬†scale or involved recalcitrant offenders, URA will proceed with prosecution. An example of such egregious cases is the one in court today,” she said.

When the men were first charged, an Airbnb spokesman said rules in the city-state do not reflect how Singaporeans use their homes and travel, and the company hoped to work with local authorities to find a way forward.

Airbnb is known to be a popular and often cheaper option as compared to hotels for many travellers.

But Airbnb has faced increasing criticism that it worsens housing shortages and squeezes the long-term rental sector, with cities including New York, Miami and Berlin cracking down on the service.

In central Paris, rentals are limited to 120 days a year and apartments must be registered with city authorities. A similar limit applies in London.

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