(Above) Dining/Great Room of an Airbnb in Old Town. Interior photos by Andrew Charles Miller. (Click on images to view larger versions.)

By Don DeBat

Jun. 4, 2025 – Managers and hosts of short-term rental units in Chicago will soon be more heavily regulated by the City of Chicago under a newly amended ordinance.

Airbnb unit owners (hosts) and managers will be required to provide additional data in the form of a quarterly report to the Department of Business Affairs & Consumer Protection (BACP) and the alderman of the ward where the short-term rental is located, noted 44th Ward Alderman Bennett Lawson, who represents East Lakeview and Wrigleyville.

“Short-term rental properties can provide lodging options for those visiting Chicago and generate revenue for property owners, but we have not had the data we need to understand where those units are and who is responsible for them,” said Lawson (left).

“This quarterly report will help increase transparency and accountability, and ensure we’re supporting responsible hosting neighborhoods across Chicago,” he said.

Currently, short-term rental taxes paid by Airbnb guests run approximately 23 percent, compared with 17 percent for guests in downtown Chicago hotels.

The hotel industry, no fan of Airbnb, has lobbied heavily against short-term rentals. However, when out-of-town guests compare the space and luxury amenities often found in many Airbnb suites, compared with the typical single room in a corporate-brand hotel, there often is quite a difference.

For example, the owner of an Old Town Airbnb invested $30,000 in furnishings and upgraded appliances into his swank two-bedroom Airbnb. The professionally decorated unit showcases expensive original artwork, colorful, framed European posters, big-screen TV with free-movie package, a bathroom with Jacuzzi and glass-enclosed shower, a gourmet kitchen with granite countertops, microwave, and ice maker, and an in-unit washer and dryer.

The host of a nearby one-bedroom short-term rental in a Victorian building provides a coffee bar with exotic teas and espresso, and a library filled with books on Chicago neighborhood history and travel.

The Airbnb manager typically charges a fee of 20 to 25 percent of gross rents, so nightly rental fees for these short-term residences can be hefty, depending on the season. Building owners say it is worth it.

“The additional Airbnb rental income often helps landlords provide more affordable below-market rents for tenants in our other units,” said the owner of an Old Town four-flat building.

“The short-term rental income helps pay the astronomical real estate taxes being charged in such upscale lakefront neighborhoods as the Gold Coast, Old Town, Lincoln Park, and Lakeview,” the building owner said.

Here is a summary of short-term rental data being requested from Airbnb managers under the new ordinance:

• The registration number, address, and unit number of all short-term rental units listed on the Airbnb managers platform.

• The registration must show evidence of a Cook County Homeowner Exemption and prove the unit is the primary residence of the host.

• The exact number of nights each unit was rented to guests and the amount of rent listed on the platform in connection with the rental of each unit.

• The total tax paid by the Airbnb manager to the city in connection with the rental of each short-term rental unit.

• A cumulative tally of the number of nights each rental unit is booked on the platform during the remainder of the calendar year.

• The telephone number of the host and local contact person.

• The Chicago ward in which the rental unit is located.

The BACP is required to submit to the alderman any reports on the number and type of all citations, violations, or other disciplinary actions related to the short-term rental unit. Violations could include excessive party noise or evidence that the short-term rental manager is not controlling the maximum number of guests residing in the unit.

The ordinance limits occupancy to two people per guest bedroom or sleeping room. That does not include a guest’s children under the age of 18 years.

A fine of $5,000 to $10,000 may be charged for each violation. Excessive citations and violations could create conditions of ineligibility for listing the unit on the platform.

“Chicago governmental officials and some aldermen have the idea that all short-term rental operators are irresponsible and unprofessional,” said a veteran North Side Airbnb manager. “They need to know that most managers are doing this job professionally and properly.”

The idea that the city should “root out” and further regulate vacation rentals in some neighborhoods is an incorrect narrative, the manager said.

“A flourishing vacation rental industry in the inner-city disperses tourism revenue on to homeowners and small businesses. It brings in tourist dollars that help support our local economy. The beneficiaries are all hyperlocal,” he noted.

Small “Ma and Pa” landlords and small businesses like restaurants, shops, bars, and local cleaning people all are working hard every day to make a decent living in an economy where inflation doesn’t stop, the Airbnb manager said.

He asks, “Why don’t regular people deserve a slice of what otherwise would all go to large, corporate hotel owners at the very top of the economic food chain?”