SAN FRANCISCO (CBS SF) — A settlement signed Monday morning in a lawsuit filed by Airbnb and HomeAway will ease the registration process for short-term rental hosts and help ensure that only those who are legally registered can list properties on the sites, San Francisco City Attorney Dennis Herrera said.

Short-term rental hosts in San Francisco will need to input a city registration number when listing properties, but will have the option of registering right on Airbnb and HomeAway’s websites, simplifying the process, Herrera said.

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In addition, Airbnb and HomeAway will provide the city with a monthly list of all San Francisco listings to allow city officials to verify that a unit is actually registered.

The sites will deactivate listings and cancel future stays for listings where the city finds an invalid registration.

“This is a turning point when it comes to enforcement,” Herrera said. “This settlement ensures that the two largest rental platforms in San Francisco will only include legal listings. It also guarantees that enforcement with real teeth begins in short order.”

Airbnb issued a statement saying that “similar to other agreements we have established with cities all around the world, this agreement puts in place the systems and tools needed to help ensure our community is able to continue to share their homes.”

Airbnb sued the city last June after the Board of Supervisors passed legislation that would fine the company for every booking it accepted from unregistered hosts.

A federal judge later rejected most of the company’s arguments but issued a stay on the legislation while the parties negotiated on the method of enforcement.

Short-term rentals have generated controversy in San Francisco over worries that they give property owners an incentive to displace long-term tenants for higher profits.

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City law enacted in 2015 requires short-term rental owners to register with the city, obtain a business license and observe limits on the number of days a unit can be rented.

It also prohibits multiple listings by the same host, requires that hosts be a permanent resident in the unit they are renting out and prohibits the use of affordable units with income restrictions for short-term rentals.

However, only about 2,100 hosts have actually registered with the city, while Airbnb alone has more than 8,000 listings, according to Herrera. Short-term rental companies have previously shown reluctance to help the city enforce the law.

The settlement calls for Airbnb and HomeAway to begin requiring hosts to be registered with the city within 120 days, and requires all hosts to be registered by the end of 240 days.

Listings linked to suspected “bad actors” will be the first to be targeted for enforcement, Herrera said.

Mayor Ed Lee said he was pleased with the mediated settlement.

“This protects our rental housing stock while allowing residents who follow the rules to gain income to help make ends meet,” Lee said. “When platforms cooperate with the city to only list lawfully registered hosts, we can more effectively enforce our laws and protect our rental housing supply.”

The settlement must be approved by the Board of Supervisors.

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