Guest Opinion: Vacation rentals, a neighborhood perspective
November 19, 2018
Realtor Sean de Moraes provided his perspective of VRBOs in the PI's Inside Business column (Nov. 12, 2018). While he tried to be balanced in his assessment, I found the discussion to be overly abstract and euphemistic.
So, here is an alternative assessment from a neighborhood perspective.
In 2013 the city, in its wisdom, added vacation rentals to the zoning code as a permitted use. For a one time fee of a couple hundred dollars, a homeowner can convert a residential property into a commercial enterprise with virtually no oversight.
VRBO (Vacation Rental By Owner) owners can offer for rent entire residential properties on a per-night basis, add as many bunk beds as possible, and advertise on the commercial websites provided by Airbnb and VRBO.
Because VRs are lucrative, individuals and syndicates bid up the price of residential real estate making it less affordable for prospective full-time residents to buy property. VR owners also benefit from the fact that these commercial properties are taxed at residential rates rather than commercial rates.
For some owners, it's purely a business like a hotel, but without those pesky safety regulations and inspections. For others, who at times use the property for their own benefit, it allows them to buy property that they can't afford and to live the dream by shifting costs to the neighborhood.
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So what are these costs? If you look at the Airbnb ads for homes in Glenwood Springs city you will observe that there are 16 homes in the downtown "minutes from the pool" that advertise for eight or more guests. Most of these accept 10 or 11 guests.
Looking at the details, you find that every bedroom is stuffed with beds and many have a living room with one or more fold outs. For the sake of argument, imagine that these properties are rented out to singles and couples that share the house. Assuming couples drive separately, this adds 160 guests and 80 cars to our limited street parking, all from just 16 homes. There are about 56 rentals that cater to groups of eight guests or fewer. Presumably, these guests will arrive by car and park on the street (potentially 112 or more cars).
The community also faces risks in having complete strangers come and spend a couple of days in the neighborhood. While there is no reason to question the character of the vast majority of these renters, there is the possibility that registered sex offenders may also temporarily move in next door. Similarly, as in other cities these properties could be used by roving drug dealers.
But even the nice people are here to party and have a good time, not to keep the streets clean and safe, or properly dispose of trash or even keep the noise down. While these costs do not show up in accounting ledgers, they are real costs to the community.
In the meantime, current homeowners face increased property assessments based on the inflated real estate prices that these businesses are willing to pay for property. Long-term renters are being displaced and forced from the community and heretofore quiet residential neighborhoods are turned into commercial enterprise zones with the corresponding loss of quality of life and neighborhood character.
That it took City Council over five years to reluctantly and apologetically agree to put a moratorium on the expansion of this industry into our bedroom communities shocks the conscience.
It's not benign to turn our neighborhoods into unregulated motel districts. Hopefully, the city will find a way to responsibly govern and protect those of us who live here.
Dr. Leslie Selzer is a professional economist who held various senior positions with the federal government in Washington, D.C. He is also a former senior partner with the Howard Group, an analytic consulting firm based in the national capital area.