A frequent use of self storage is to store one’s possessions during a vacation, so that one’s home can be rented to another vacationer. A once rare practice, renting residential homes for a vacation has become common over the last decades, as travelers try to make do on smaller budgets. Renting a home from the homeowner is often cheaper than staying in a hotel. But this summer many cities have begun to ban short-term vacation rentals, including apartment rentals and condo rentals. In other cities, longstanding laws against the short term rentals are being enforced more rigorously for the first time. New York and Chicago passed laws this summer banning short-term rentals. Maui, Hawaii, has begun to enforce an old law against short-term vacation home rentals, and so has Paris, France.
In New York, it will be illegal, after May 1, to rent an apartment for less than a month at a time. In Chicago, it will be legal only if property owners get a special-use permit and a business license. Likewise, in Paris, a property owner wanting to rent an apartment for less than a year would need to have the residential property reclassified as commercial.
“It isn’t difficult, it is impossible,” said French notary Fabrice Luzu in the July 6 New York Times. “The owner must apply for a special permit and there is very little chance he would obtain it.”
Although the laws apply to everyone, industry experts say that it is unlikely that a homeowner who only rents out the home once a year would be prosecuted. Instead, cities are targeting property owners who do not live at their own properties, but are operating them year round as profitmaking ventures.
The Vacation Rental Managers Association says that dozens of jurisdictions across the United States are contemplating similar actions. Some cities, like Paris, are trying to address a housing shortage. Others, like New York City, are heavily influenced by the hotel industry lobby.
Vacation rental associations argue that their members, even the ones who do not live in their properties and instead rent them out short-term all year round, provide an important service to cities, allowing scholars and businesspeople to make extended stays in cities where they must work and do research.
Alternative vacation housing used to be almost unheard of, but over the last ten years it has boomed. “It’s gone from being a literal cottage industry to nearly a quarter of U.S. lodging revenues,” Brent Hieggelke of SecondPorch.com told USA Today last week. SecondPorch.com is a website that uses Facebook to connect potential renters with homeowners. Short term vacation rentals are usually booked through websites like Second Porch, through private classified ads, or through budget travel sites such as AirBnB, Roomorama, or HomeAway.
Some vacationers say they will not be returning to cities that ban short-term apartment rentals.
“We really prefer apartments because you can set your own schedule and get a feel for what it’s like to be a New Yorker,” commented Ken Velten, a frequent visitor to New York, in the August 6 travel section of USA Today. “We love the city, but not what we’d have to spend at a comparable hotel.” Velten explained that hotel rooms in New York for himself and his family would end up costing him more than $210 per night, or around $3000 for a two week vacation (not counting air fare, restaurants, museum entry fees, etc.). A short-term apartment rental for the same period typically cost him $2500, and meant that the family could have the use of a kitchen for cooking, so they could save on restaurant costs during the trip.
Sources used:
AirBnB.
Bly, Laura. “More destinations shut the door on vacation rentals.” USA Today. Aug. 6, 2010.
Home Away.
Lovece, Frank. “New law bans short-term co-op & condo rentals.” Habitat Magazine: For Board Members and Property Managers of Co-ops and Condos. Originally published July 2, 2010, updated July 14 and July 25, 2010.
Rafferty, Jean. “To address its housing shortage, Paris cracks down on pied-à-terre rentals.” The New York Times. July 6, 2010.
Roomerama.
Second Porch.