Short-term rentals and the housing crisis

The city council of the small city of Port Angeles, WA is going through a period of debate on whether to limit short-term rentals (STRs). There is a shortage of rental apartments and advocates of limitation assert that STRs remove apartments from the market for long-term housing.

After a lot of debate, a compromise was reached limiting the number of STRs to 200. They will be taxed to provide revenue for the city.

I own a small cabin on my property which I sometimes think of using as a STR. DH doesn’t like the idea of strangers on our property so I haven’t done it. I know that I could easily rent it out during tourist season since we are near Olympic National Park and also there are many local events (e.g. Lavender Festival, bicycling, etc.). I have no interest in a long-term renter since Washington State has lots of protective regulations for renters.

Although the STR issue is local I’m sure that it is arising in many parts of the country, making it Macro in impact. From the landlord’s point of view it’s more beneficial to rent short-term to maximize income with minimum hassle.

Wendy

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I would think that finding a good long-term tenant would have less hassle. During the three decades that my rent vs.buy analysis showed it was cheaper to rent and keep my money in the stock market, I never had a problem finding a comfortable home in a good neighborhood.

Lots of stories about Airbnbs and wild parties – and I suspect there is an even lower return on the accessory dwelling if one leaves it vacant.

Where I live, “low income” housing assumes you have an income of at least the 40th percentile of County income. Where are the bottom 40% of the income ladder supposed to live? If you’re upset with tents in the park and decrepit RVs parked on your street, the only other solution is to raise taxes and provide some subsidized housing.

intercst

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Article in the WSJ today explaining that the Airbnb crackdown in New York has really jacked hotel prices. One guy even paid $345/night for a Holiday Inn Express in Queens.

https://www.wsj.com/lifestyle/travel/airbnb-new-york-hotels-short-term-rentals-law-802b484e

intercst

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I’ve been a long term landlord and currently own a short term rental. “Hassle” is relative. Long term hassles typically tend to be irregular, long spaced events that are a big-ish hassle (tenant screening, etc). Short term is steady, but mostly minor (toilet seat is broken).

Wouldn’t a long-term tenant complain about the broken toilet seat, too?

intercst

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In theory yes, but in practice long term tenants don’t complain about broken toilet seats.