The real issue is insurance. AirBnB is living in a vacuum in that space. I would bet less than 1% of hosts have proper coverage for subletting out their living

The real issue is insurance. AirBnB is living in a vacuum in that space. I would bet less than 1% of hosts have proper coverage for subletting out their living space, and 99.99% of landlords have specific exclusions on their policies against subletting. So you have an instance where a potential loss to the insured (the landlord), the host, and the consumer is completely uninsured. Now multiply that reality across the entirety of the AirBnB hosts in NYC, and you have a recipe for a financial nightmare.