Equitable regulation of short-term rentals from the Sustainable Economies Law Center

Digital platforms like Airbnb, Flipkey, Stayz, and many more have made it easy for city residents to offer spare rooms, or even entire residences, to those (most often tourists) needing short-term rental (STR) accommodations. STRs are typically defined as stays under 30 nights.

STRs bring with them a range of benefits, including helping residents generate extra income from unused spaces, opening up accommodation in areas where there's unmet demand, serving as overflow capacity when hotels are full, bringing visitors to areas of the city which don't attract high levels of tourism, and generally stimulating local economic activity.

There are also important drawbacks, especially in cities where such platforms have achieved a high level of market penetration. Public policy issues begin to emerge, such as the loss of hotel-related municipal revenue, health and zoning violations, safety concerns, noise complaints, and, perhaps most importantly, a decline in affordable rental housing stock. In a growing number of cases, owners evict long-term tenants to rent their houses to more profitable short-term guests, or speculators buy or lease residential real estate to set up illegal hotels.

The Sustainable Economies Law Center (SELC) in Oakland, California, has produced a guidebook for equitably regulating short-term rentals entitled, "Regulating Shortterm Rentals: A Guidebook for Equitable Policy." The gist of the guide is to legalize some aspects of STR activity, while ensuring the public interest is protected. The guide covers areas of concern for hosts, guests, communities, and local governments, including protection of affordable housing supply, ensuring the well being and safety of guests, respecting the rights of neighbors, ensuring public tax revenues are maintained in ways that are fair to short-term rentals and commercial hotels, and ensuring reporting and recordkeeping.

SELC suggests that policymakers consult the guide for general principles, but tailor the recommendations to each city's particular circumstances in dialogue with all local stakeholders. The guidebook was released in 2016, so it is yet to be adopted by a city in its entirety. However, a number of municipalities have developed local ordinances aligned with the guide. For example, Lisbon recently joined Paris, Amsterdam, and a number of U.S. cities in signing an agreement with Airbnb for responsible home sharing, while enabling Airbnb to collect and remit tourist taxes to the city on behalf of hosts.

View the full policy here.

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Header image provided by Josh Wilburne on Unsplash

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