City Share Housing Ordinance Enables Out-Of-Control Party Houses At Rented Homes, Critics Say

CHICAGO (CBS) -- Massive crowds, public drinking, and so-called crib parties are just some of the problems that have plagued some neighbors in Old Town for years.

They blame the city's Shared Housing Ordinance. CBS 2 Investigator Megan Hickey dug into some of their complaints, and reported Thursday evening that the city could be missing out on money too.

Right now, there are only two online platforms that pay for licenses – Airbnb and HomeAway. Time and time again, we have found properties that get kicked off those sites and end up on sites that are not regulated.

On Feb. 23, 2019, between 1:45 a.m. and 2 a.m., four police officers came to break up a party at an Old Town rental. Within 15 minutes, dozens of people streamed out.

"It just was bad," said Rich Christian, who lives next door.

But it was not an isolated incident. Night after night, month after month, cameras captured crowds waiting at the door to pay an entrance fee.

The loud late-night parties continue, the police keep showing up, and the neighbors feel helpless.

"You have 60, 70, 80 people that are marching in out of the building at all hours," Christian said.

Christian said the drugs and public drinking would be enough. But they are not all that happens.

"They're urinating off the deck of the building onto my neighbors building," he said.

He said Chicago's current home sharing ordinance doesn't have an easy way to deal with problem hosts. In this case in Old Town, the city eventually had to sue the owner in Housing Court in order to stop the short-term rentals.

Airbnb took the listing off the site within 24 hours of its license being revoked. But as representatives explained at yesterday's city council hearing, that does not necessarily mean the problem is solved.

"We can delist problem properties, and that's what we did in that case," said Yvette Bourcicot, public policy manager for Airbnb. "But there is an issue of migrating to other unregulated platforms."

And Christian's party house neighbor did just that. The property ended up on Booking.com - one of several online platforms that, as of right now, doesn't have to pay vacation rental and home sharing surcharges to the city.

Airbnb and HomeAway's fees added up to $1,125,740 million between June 2017 and June 2019.
Christian thinks all home share platforms should be held to the same standards. He also wants automatic repercussions for bad host written into the city's law.

"The contracts have to have teeth," Christian said.

A representative of the City's Department of Business Affairs and Consumer Protection said they have been, and are continuing to, work closely with platforms like Booking.com to try to bring them into existing regulations.

As of March 2020, Chicago has 8,500 home share units - but only about 60 percent of them are registered with the city.