de Moraes column: How VRBOs affect our neighborhoods
As City Council voted on a suspension of new vacation rental properties, it seems like a good time to examine these and how they affect our neighborhoods. Whether I am for them or against them is irrelevant; however, I wanted to bring to light the impact they can have to an area.
Vacation rentals can have a positive impact on a city or community in many different ways. Having more rental options in a community than just what is available at hotels, a city can earn additional tax revenue when regulated properly. Furthermore, with more tourists coming to the area, surrounding businesses can experience an economic boost because the tourists will spend additional money at the restaurants and local attractions. Short term rentals generally equal increased tourism.
By going onto VRBO and typing in Glenwood Springs, you will see well over 250 options in and around the city. While many of these might be studio or one-bedroom units best suited for a tourist for a few nights, it also eliminates the long term rental inventory for the locals. A decrease in long-term rentals will ultimately result in increased rental prices, making our area less affordable for the workforce. On the flip side, would these owners even be offering them long term? Most of these owners use the VRBO platform to offset their cost of having a vacation place. They would either not purchase the property or it would simply remain vacant, taking away from tourist beds.
What about the “great, but not in my back yard” saying? Living next door to a vacation rental can be a little bit concerning to some and life changing to others. VRBO properties generally will get rented out to folks for three or four days, meaning your neighbor is changing every few days. Not knowing your neighbor may be concerning when your children are playing outside. A local resident may be concerned that the character of the neighborhood is changing. Complaints of excessive noise, parking issues and trash may easily become issues for the neighbors.
Since VRBOs are relatively new, becoming popular within the last decade, I don’t believe we have fully seen how it will affect home values when it comes to resales. They can negatively impact the value of a neighborhood because of their disruptive nature, of course. However, it may also increase values because of the ability to generate revenue. What was once a family home instantly becomes an investment and will be exchanged on the real estate market based on CAP rates. Now someone with the dream of owning a home is competing with an investor.
Sean de Moraes is an agent with Roaring Fork Sotheby’s. He can be reached at email@example.com.