Movement to ban STR's

Movement to ban STR's

Real Estate Agent · Colorado Springs, CO · Member since 2017 · 224 posts · 201 votes

I've been trying to follow what is happening on the STR front nationwide and would love to hear from BP members about what's happening in your particular city/location as far as restrictions? When we bought our property in Colorado Springs, I knew there was a chance we only had a window to do STR's in as I saw Nashville beginning the start of a ban. A year and a half ago, the city of Colorado Springs was extremely STR friendly. After we closed on our property, we heard about restrictions being discussed and I was very involved in that whole process. The permitting process and rules which were instituted at the start of this year seemed very fair and reasonable to people on both sides of the issue. Somehow in the past several months, all on our city council except for two members have decided they pretty much want to ban any further STR's other than owner/occupied despite the lack of any verifiable data showing any issues (no permits have been revoked and very, very few complaints to code enforcement). I do believe they will grandfather in those who currently have a permit. We had quite a bit of success at the start by banding together and forming an alliance of owners, but that influence doesn't seem to be helping at this point. I did see the Texas State Appeals Court just struck down the city of Austin's attempts at banning non-owner occupied which could mean more STR owners will turn to the legal system if they feel the city isn't treating the issue fairly. If you are an STR owner, I'd love to hear what your city is doing?

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Chris MasonPro Member
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Lender · CA · Member since 2015 · 9k+ posts · 10k+ votes
6y

The market for furnished rentals is a lot larger if you think of it as a "furnished rental" rather than as a "short term rental."

When a nurse is in town on a 3 month contract gig, where are they staying (healthcare is a big employer in my area)? When an actor is in town for a play that's going to be in rehearsals for a month then run for 2 months, where are they staying? That wedding planner has a short list of suggestions for where the bride and groom should stay, are you on that list as an option (near me is wine country => lots of weddings happen there)? XYZ Medium Sized Company takes on 3 unpaid interns per year but covers their lodging, who do you know at XYZ Medium Sized Company? Almost any industry or region you can name has stuff like this. Hotels dominate these things b/c they are markets that typical AirBnB hosts don't even know exist, meanwhile the hotels are building corporate B2B relationships (& not giving a cut of their action to AirBnB to boot). 

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  • Rental Property Investor · Tremonton, UT · Member since 2019 · 15 posts · 6 votes
    6y

    @Robin Searle

    I have been running an owner occupied STR for almost a year. It's gone very well. I am curious about the "furnished rental" market that you have spoken of, and listing mediums you know of for such a thing. I've had quite a few people reach out for extended stays on our AirBnB (1-6 months long) but nothing has ever worked out (often because the Airbnb fee gets outrageous when compounded for long periods of time).

    Are there other sites that are furnished rental specific? For people who focus on that market how do they find tenants?

    Thanks!

  • Real Estate Agent · Colorado Springs, CO · Member since 2017 · 224 posts · 201 votes
    6y

    @Bryce Bender There are several FB pages for Travelling Nurse accommodations that you could advertise on. They are typically looking for several months. There is also a company in Denver called Avenue West (you can Google them) who handle corporate rental placements. I'm not sure if you can advertise with them if they aren't managing your property though. There are also several corporate rental pages on FB including some for owners so they likely have a lot of insight into where to advertise. I would think you'd want to keep the listing for longer term rental off Airbnb from the sounds of the fees. I was planning to use my STR for clients who were between houses (e.g. while doing a new build) but we've been booked solid so that hasn't worked out. The STR definitely been very profitable but I also have long term rentals that are profitable too. I agree with many of the posts on this thread that having a back-up plan is a must. It'll certainly be interesting to watch the legal challenges around the country.

  • Real Estate Agent · Tampa, FL · Member since 2017 · 191 posts · 98 votes
    6y

    As far as I know, the city of Tampa and Hillsborough County have no regulations against it. There is a tax in place and owners do need to register with the DBPR.

    Beachfront cities and towns in Pinellas County ( St. Pete area ) are a different story. STRs are banned in most of those areas barring some exceptions for owner occupants and the zoning. If it is commercial or "tourist area" zoning, it is allowed.If it is residential, rentals cannot be shorter than 30 days.

  • Rental Property Investor · Tampa, FL · Member since 2019 · 74 posts · 27 votes
    6y

    @Robin Searle

    STR Changes are being discussed for Boise Idaho in the political circles. There has been vocal opposition in the news about STRs driving up our Boise housing prices and locals being priced out. "Affordable Housing" is one of Top 3 issues for our 2 new mayor candidates (run off elections today to determine which one is selected). They seem to breeze over the city raising max taxes past 3 years but that's a separate discussion.

    Personally I do not own any STRs but I have stayed in VRBOs a few times before and really enjoyed them compared to hotels.

    As with most important issues, I would also rather keep politicians out of it and let free markets dictate.

    Good luck!

  • Real Estate Agent · Colorado Springs, CO · Member since 2017 · 224 posts · 201 votes
    6y

    @Ryan Hall I so agree with you. All of the people saying any city is going to be overrun with vacation rentals obviously doesn't believe in free markets. If every other house was converted to an STR, the rates would be driven down so that none of them were profitable and property owners would start moving back to a long term rental model. My family always stays in STR's when we go up to the mountains. So much nicer than having separate hotel rooms - we are all in a home and can cook meals together while enjoying a great locale. That was one reason I wanted to do this model - it's so fun to read the great reviews about how much our guests loved staying in our property and letting visitors enjoy Colorado Springs!

  • New Orleans · Member since 2019 · 15 posts · 4 votes
    6y

    @Lucas Carl wow! What city, state is that at?

  • New Orleans · Member since 2019 · 15 posts · 4 votes
    6y

    @Brian Spies short term rental, so like air bnb and such

  • Contractor · Nashville, TN · Member since 2019 · 11 posts · 4 votes
    6y

    @Robin Searle I have a STR in Nashville and the city is getting really strict. There is currently a proposed bill that if passed would prevent all future owner occupied STR's from renting out the whole house at once. Also it wouldn't allow the homeowner to be absent from the home longer that 15 consecutive hours during the time it is rented.

    This is absolutely absurd to me. I have no idea how they plan to enforce this but I sure hope the bill doesn’t pass!

  • Investor · Chattanooga, TN · Member since 2019 · 1 post · 1 vote
    6y

    @Robin Searle

    In my area the pressure to limit STR is coming from local communities that have had to deal with noise, crime, and other disturbances from bad tenants. Particularly when out of town investors buy a property strictly for STR and are completely oblivious as to what's going on at the property. My community now has a requirement that NEW STR properties must be owner occupied if they are zoned residential.

  • Real Estate Agent · Colorado Springs, CO · Member since 2017 · 224 posts · 201 votes
    6y

    @Matthew Dunn I believe that’s where Colorado Springs is headed although we have had no reports of crime or any other code violations according to the city. I guess those of us who hold permits already will be the lucky ones

  • Hatfield, PA · Member since 2012 · 1k+ posts · 629 votes
    6y
    Zoning and ordinances has nothing to do with people who want to make a profit. People have the mistaken idea that they should be allowed to do whatever they want and the rest of the people are just getting in the way. The local residents and their quiet enjoyment by far come first. The only short-term rentals I have any kind of pity for those who also live there and are invested in the community.

    being overrun is exactly what's happening to some neighborhoods and communities.

    "All of the people saying any city is going to be overrun with vacation rentals obviously doesn't believe in free markets.  "
  • Real Estate Agent · Colorado Springs, CO · Member since 2017 · 224 posts · 201 votes
    6y

    @Ken Latchers I’m a Realtor and I absolutely believe in everyone’s right to quiet enjoyment of their home. I also believe in private property rights which I would think every investor in this site would be of the same mind. What you are talking about should be addressed by regulation and code enforcement not outright bans in my opinion. You might be all for government overreach until it affects something you want to do with your own property that was not only allowed but encouraged by your city when you purchased!

  • Member since 2019 · 114 posts · 111 votes
    6y

    The ritzy part of my location, Oakwood, has banned short-term rentals.

  • Naji SabaPro Member
    Investor · Austin, TX · Member since 2017 · 21 posts · 18 votes
    6y

    @Robin Searle: glad to see this topic discussed, as it's getting ridiculous!  My two CoS STRs in in R-2, so safe for now, but the corrupt politicians are having some really nice kickbacks somewhere.  Like all RE investment, the biggest winners are always those who discover the treasure (hot area) first.  And then everyone else shows up to ruin it.
    Thanks to @Trey Farmer for sharing the link on Austin! I had no idea about this great news as I look to turn my current Austin home into an STR when I move.

  • Real Estate Agent · Colorado Springs, CO · Member since 2017 · 224 posts · 201 votes
    6y

    @Naji Saba yes Mine is in R2 as well. If you aren’t part of Colorado Springs short term rental alliance you should goin! Ryan just shared that link and it’s interesting that the state overruled Austin’s Han.

  • Hatfield, PA · Member since 2012 · 1k+ posts · 629 votes
    6y
    We are  in agreement.  I am not talking about the bans,  I'm talking about that a lot of  short-term owner wannabes  are unhappy that so many communities are catching up with the  rapid growth  of short-term rentals which is often not even in  the code book.

    on the other side, a lot of the short term rental owners seem to think that communities should not even be regulating this or doing so lightly. I am totally opposed to the concept that people making money should be favored in any way over the neighborhood.

    personally, I think it should be 100% banned for owners who do not live in a community. In my opinion, that is just a hotel and I would love to see them all gone except for true vacation markets like the Smokies. My neighbor operates a guest house, and I actually got a call about him complaining about my tenants who are not even doing anything in particular because he was monitoring them through camera and audio.

    Over time, a balance will be found.

    Originally posted by @Robin Searle:

    @Ken Latchers I’m a Realtor and I absolutely believe in everyone’s right to quiet enjoyment of their home. I also believe in private property rights which I would think every investor in this site would be of the same mind. What you are talking about should be addressed by regulation and code enforcement not outright bans in my opinion. You might be all for government overreach until it affects something you want to do with your own property that was not only allowed but encouraged by your city when you purchased!

  • Rental Property Investor · SF Bay Area, CA · Member since 2014 · 352 posts · 543 votes
    6y
    Originally posted by @Chris Meadors:

    @Robin Searle Napa, CA has a 30 day minimum. I understand South Lake Tahoe just banned any further licenses for Short term rentals as well. That’s my random market update:)

     Hi Chris,

    I thought there was a complete ban in Napa, CA.    That's why I thought I saw so many STRs in next door Sonoma and very few in Napa, Ca.  thanks for the info.

    What are doing to enforce this law?   Neighbors reporting to the city?


    Dublin, CA has no ban but city officials not very friends and will use existing laws on the books to force 30 day+ stays.

  • Flipper/Rehabber · Tigard, OR · Member since 2017 · 1 post · 0 votes
    6y

    @Brian Spies STR stands for short term rental

  • Real Estate Attorney & Investor · Greater NYC Area · Member since 2016 · 70 posts · 48 votes
    6y

    @Robin Searle in NYC and Jersey City regulations and limitations are being implemented. In Jersey City AirBNB spent millions to fight the implementation of regulations but voters overwhelmingly (70%) voted to regulate STRs. Being so close to Manhattan, residential neighborhoods and condominiums with families were dealing with unruly tourists and transient tenancies (bachelor parties, etc.) sharing their common spaces and dividing interior walls. In NYC STR falls under hotel use and violates the certificates of occupancy for residential properties. The fines can be stiff and are imposed upon all tenants/owners within a building. In densely populated urban areas STRs can be a real problem.

  • Nashville, TN · Member since 2017 · 2 posts · 1 vote
    6y

    @Brian Spies I think it stands for Short Term Rentals (ex: Airbnb)

  • Jersey City, NJ · Member since 2017 · 1 post · 0 votes
    6y

    @Brian Spies short term rentals (aka Airbnb)

  • Realtor · Tulsa, OK · Member since 2019 · 76 posts · 42 votes
    6y

    @Robin Searle Tulsa, OK is requiring non-occupied owners of STR to go before board of adjustment and request exception to zoning- or a permit. The city is working to require a licenses. All this has take. Them a year to decide on. Limits of no more than 8 people and 4 bedroom homes... however if you are an owner-occupied STR there is no special permit. Others could speak better to our situation as I've just researched STR market here and only have LTR myself.

  • Dan H.Pro Member
    Investor · Poway, CA · Member since 2015 · 7k+ posts · 8k+ votes
    6y
    Originally posted by @Robin Searle:

    @Ken Latchers I’m a Realtor and I absolutely believe in everyone’s right to quiet enjoyment of their home. I also believe in private property rights which I would think every investor in this site would be of the same mind. What you are talking about should be addressed by regulation and code enforcement not outright bans in my opinion. You might be all for government overreach until it affects something you want to do with your own property that was not only allowed but encouraged by your city when you purchased!

    We have a duplex STR so believe STRs have their role but …

    Most residential areas were not zoned for commercial enterprise.  STRs are a commercial application being applied into residential areas.  An analogy would be an investor purchases a lot that is zoned open space but of course cannot make money if it is open space so they want to get it changed.  They purchased it knowing it was zoned open space and at a price that depicted that it was zoned open space.  Now they want to do whatever (high occupancy housing, luxury housing, commercial buildings, a landfill, self storage, etc.).  

    So the regulation already exists in most areas to not allow STRs (commercial use) in many residential areas that STRs are located.  The owners and sites like Airbnb, VRBO, etc. decide that they want to use the residential homes for a purpose that was not the intent and are disappointed when regulations "ban" them where they often were never permitted in the zoning.  

    My STRs are the same (in an area that was never zoned for commercial) but the area is so heavily STR that virtually all units are STR. This area was never intended to not have any local residents, but the STRs were so profitable that over the years virtually all units have been converted to STR. We were one of the first to have converted our units to STR as they have been STR over 20 years. Back then, I did not envision a time when there would be zero residents (virtually all units are STR).

    I understand the desire to ban STRs.  Less housing for local residents especially in areas short of housing.  More transient population; no neighbors.   Drives the cost of housing up for everyone.

    I have STRs, but I do not want STRs in my residential area. Hypocritical? Probably, maybe definitely.

    I will be disappointed if my STRs get banned.  My rent will fall from ~$16k/month to maybe $7K/month.  It would also result in the value depreciating likely significantly.  If it happens, I may buy some of the depreciated properties.

  • Rental Property Investor · Portland, OR · Member since 2017 · 8 posts · 4 votes
    6y

    Even though laws and regulations will change and Hotels have deep pockets and a loud voice to encourage restrictions on STRs, I think they are here to stay. I still see listings in cities with strict regulations or bans so my take is that it doesn't matter. Hosts are going to list their property whether it's legal or not. As long as Airbnb and other STR platforms protect their privacy, what can they do about it?!

    On another note, as a STR host, I've recently become a big proponent of furnished rentals for 30-90 days. In fact, in the winter I make more than going short term because everyday is filled. There's always other opportunities when others get shut down, we've just got keep moving and keep our eyes and minds open to them.

  • Real Estate Agent · Colorado Springs, CO · Member since 2017 · 224 posts · 201 votes
    6y

    @Nolan Clark agreed! Always have a back up plan no matter what your investment strategy!

    Thank you all for weighing in!

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