I support Short Term Rental of Accessory Dwelling Units (ADUs)
Short Term Rentals (STRs) have been much in the news in the past couple of years because internet advertising systems have made it possible for more would-be hosts to reach more potential tenants than ever before. It isn’t a new idea. When I traveled in the British Isles in 1981 I bought a newsprint booklet that listed Bed and Breakfasts (BnBs) in every town. Some were rooms and some were stand-alone apartments. And of course larger BnBs have been familiar here in Asheville since a decade or two before Thomas Wolfe’s mother launched her boarding house.
For whatever reason when the current version of Asheville’s Unified Development Ordinance (UDO) was fashioned in the late 1990s it included a strict prohibition against renting any housing unit in residential areas for less than 30 days. A housing unit was deemed to be a place where someone might live full time. As a practical matter it was deemed to be rooms including a stove. It also provided for legal HomeStay rental, which meant rental of a room or two within a private home for less than 30 days, without a separate stove. Oddly enough it also required the host to serve breakfast to guests. For other meals it was necessary to share the kitchen.
Who Knew? And When?
As near as I can determine, most people didn’t know about the 30 day limit, and those who did didn’t much care. Numerous hosts I have spoken with insist that when they went into the business in recent years they contacted Asheville City Staff representatives and asked if it was okay. Many were evidently told the same thing (though no one on Staff today is willing to admit it): “As long as there are no complaints.” As a practical matter, whether Staff said those words or not, that was the basis for enforcement. No problems? No problem. For the most part it seems that loud parties were the principal trigger for complaints, though sometimes parking issues or other infringements on neighbors were an issue.
As internet advertising caught on the number of people participating as hosts grew. AirBnB is the best known, but Vacation Rentals By Owner (VRBO), FlipKey, CouchSurfer, and others including Craig’s List began to feature listings. The systems with the best feedback became the most reliable for both hosts and visitors which may be why AirBnB has been such a success around the world. Hosts rate guests and guests rate hosts. In order to be permitted to make reservations a guest had to have a clean record—make trouble for one host and no one else wanted your business. Hosts had a big incentive to provide the best facilities in their area or price range. Hosts often invested substantial money in their rental units. (I know one couple who put something like $60,000 into a honeymoon suite: hot tub, kitchen with latest appliances, spiffed up furniture and decor.) These hosts made their financial plans based on what they believed was a de facto legal business, whether or not they knew it was illegal de jure.
Many people operated their STRs for years without neighbors even noticing (in my case a house across the street was doing this for three years and I only learned about it when the STR issue blew up in 2015.) On the other hand, some neighbors were very aware and angry that their neighborhoods were “being turned into hotels.” During that same time period housing prices in Asheville and around the country were rocketing. (This was largely the result of a house building dip during the Great Recession, with the added stress locally of Asheville being the most popular city in the country on numerous best-of lists.) Affordable housing advocates began to blame STRs for the shortage of affordable apartments and homes.
As an upshot of the upset, Asheville City Council voted in the fall of 2015 to begin strict enforcement of the UDO rule against rentals less than 30 days, and to raise the fine for violation from $100 per day (after a Notice of Violation was issued and if the host did not desist) to $500 per day. In the November 2015 City election the chief advocate of the high fine and strict enforcement was voted out of office, with his stance on STRs one of two principal reasons for his defeat. (The other was his support of sale of the Haywood Street property to a hotelier.) However four members of the new Council continued to support the enforcement effort and hundreds of hosts were issued NOVs and forced out of business (or forced to remove stoves in order to get HomeStay permits.) (How many of those stoves remain removed is anybody’s guess.) The City is spending something upward of $250,000 on enforcement efforts (depending on how one calculates the cost. New staff and new internet search services have been contracted, but its hard to figure how much pre-existing staff and so forth are enlisted in enforcement.)
So we continue to have a black market in STRs. Many are still operating using all sorts of strategies. Some only advertise to previous guests (return business is a mainstay for many hosts.) Some post at night or on weekends when City enforcement staffers are off duty. Some pose as HomeStays. But the bottom line is we have no idea how many are operating and where they are operating.
I believe we should permit people to use what is often their most valuable asset to benefit from the burgeoning tourist economy here. Millions of dollars of property tax money go into the infrastructure and public safety demands of tourism, and millions of room tax dollars (from hotels and AirBnBs) advertise this city around the globe. I see no reason why the benefit of the tourist economy should all run to non-local hotel chains which pay meager wages when local residents are prohibited from offering rentals. The need for affordable housing is not limited to the minimum wage workers in the hospitality business, it includes hard pressed couples and single parents unable to make ends meet with Recession depressed wages. Furthermore, STR hosts often employ local housekeepers who are paid much better than hotel maids, and service workers who keep their properties in tip-top shape.
As an interesting sidebar I met two strong opponents of STRs at a coffee shop in mid-March, 2017. While they both oppose “turning neighborhoods into hotels,” their reasons were diametrically opposed. One feared that STRs would diminish the value of his home when he eventually sells and moves to a simpler (retirement) dwelling. The other feared that STRs would drive up property values and make housing less affordable. I suppose each hopes that the other one is right.
I believe we need to accept the new economy, sometimes called the sharing economy, and see the the entire community is better off for it. As I wrote this, AirBnB reported that their participants took in $13 million in 2016. That’s money that stays in the local economy.