Airbnb faces reckoning as crucial legal rulings loom

Airbnb is facing a reckoning in several cities from officials who say short-term rentals have a bad impact on neighbourhoods and urban housing.

The company is thriving, with investors believing it is worth $30bn (£24.5bn), but it is also facing a series of challenges in cities around the world.

In New York, the company's largest US market, the state legislature has tightened regulations barring people from renting out their apartment on a short-term basis.

The new bill would fine hosts up to $7,500 (£6,000) for listing units on the site that run afoul of local rental limits.

Governor Andrew Cuomo has signed the bill into law, despite Airbnb's attempts to kill the proposal.

San Francisco passed an ordinance this year that would fine Airbnb and similar services $1,000 (£815) each time they process a booking from an unregistered host.

Airbnb has countered the move with a lawsuit, asking a San Francisco federal judge to strike down that law.

The case is a crucial test of Airbnb's business model. The company argues it cannot legally be held responsible for how landlords use its platform.

If it loses the case, which other officials are closely watching, that could drastically reduce listings - and revenue - in some of its biggest markets.

To help ease tensions, the company has proposed a set of measures including creating an online registry of property owners and a hotline for neighbours who want to complain.

In a statement released this week, Airbnb said it will prevent hosts in New York and San Francisco from listing multiple units starting on 1 November.

"This will help to ensure that home sharing does not remove permanent housing from the rental market," the company said.

Airbnb, which takes a cut of the revenue when a room or a home is booked and charges a service fee to guests, says it helps communities by enabling middle-class families to make extra money.

Critics say that, in popular tourist destinations, Airbnb takes affordable housing off the market, drives up home prices and disrupts neighbourhoods with streams of transient visitors.

The company is also facing challenges in Europe.

In London, it recently denied it is to blame for rising rental costs .

Berlin has passed a law banning most short-term rentals, and Barcelona and Amsterdam are imposing steep fines for listings that violate laws there.