You are right to make the technical distinction between NYC's "rent control" and "rent stabilization", but both have the same negative consequences for housing maintenance and creation.
According to [1], in 2011 about 47% of NYC housing units were rent-regulated.
[1] http://furmancenter.org/files/publications/HVS_Rent_Stabiliz...
People subletting their apartments aren't subletting rent-controlled apartments, by and large. This doesn't apply in other cities, but in NYC, any listings you see on AirBnb are almost certainly for unregulated apartments.
> According to [1], in 2011 about 47% of NYC housing units were rent-regulated.
73% of those (34% of total apartments) are pre-1947, which are regulated, but most of those are under a separate provision, which means they aren't subject to the same restrictions as what we're talking about here.
My point is, rent-controlled apartments are being subletted. The situation in my building is not a fringe case. Craigslist and word of mouth illegal subletting is common. AirBnB is not the only name in the illegal subletting game in NYC, but they are the only name in luxury illegal sublets.
If they are rent-controlled, even if they are paying their rent, he can evict them with no problem.
The relevant government agencies have a moderate amount of information line, but I'd recommend calling them instead. I've done this before; they're very friendly and helpful if you call them on the phone. I'd recommend giving them a call and asking for advice on the eviction process:
http://www.nyshcr.org/rent/ http://www.housingnyc.com/html/about/about.html
I grew up in a rent-controlled apartment in midtown manhattan that my mom has lived in since the 70s (you have to have lived in the apartment since before the end of 1971, actually).
However, it's not true that you could easily be paying 5% of market rent. My mom is paying about 50% of market rent and here's why:
Every 2 years the landlord is allowed to increase the rent by up to 7.5%, not exceeding the maximum base rent. Housing votes to increase the maximum base rents and ends up voting in favor of it maybe 3 times a decade or so.
However, if the landlord makes capital improvements to the building, they're allowed to increase the rent and in buildings in good areas with rent controlled tenants, they often do. Capital improvements let them raise the rent a lot more than that 7.5%.
My mom paid $318/mo for her apartment in 1984. If housing had voted to increase the maximum base rent every single time and the landlord increased the rent 7.5% every two years she would be paying $875. But this hasn't happened. Even so, she pays nearly double this amount because of capital improvements made to the building over the years.
They've even fucked her over and increased her rent based on capital improvements to the apartment she made herself out of pocket (updated wiring, renovated bathroom, etc).
As someone who used to work at a tax certiorari firm, I can tell you there's just as much fucking over between the landlords and city/state tax money. Landlords are making money for not doing a whole lot except owning land. New York landlords make a killing. I've seen their returns. There are landlords who leave large portions of or entire buildings vacant _on purpose_.
If you really want to go down that rabbit hole, we can talk about how land ownership and the tax structure is a massive wealth extraction from the lower classes.
Don't give me that bullshit argument.
So when you have problems with your wiring that your landlord refuses to fix (that are required to be fixed by housing regs) you have two options: a) complain and wait months/years for action or b) fix it yourself out of pocket.
You choose option b and then the landlord raises your rent. You don't think that's getting fucked over? You think tenants should put up with shitty (below required) conditions just because the rent is cheap (as regulated by law)?
Wow.
This is not the issue.
There are very, very few rent-controlled apartments left in NYC. Almost nobody who works in the tech industry here has one, because it requires having lived in the same apartment since the 1970s. If you have one, though, you could easily be paying 5% of market rent.
Rent stabilization is a very different set of laws altogether, and these apartments are also vanishing slowly.
As for true rent control, landlords would love it if their rent-controlled tenants were to sublet their apartment on AirBNB. That would allow the landlord to kick the tenant out and charge market rent - 20 times more - for the apartment.