Daily Regulatory Notes 12/9/2024

Every day, we bring you a detailed overview of recent news and updates about primary decisions, community feedback, or legislative changes relevant to the short-term rental industry. 📰

Lexington, KY

The Lexington-Fayette Urban County Council has approved new short-term rental regulations, with nearly unanimous support except for Councilmember Chuck Ellinger, who abstained, citing concerns over rushed changes.

Starting December 12, the new regulations will take effect introducing significant restrictions, including capping STRs to 2% of housing units within 1,000 feet of residential zones, limiting hosted occupancy to 10 people, and prohibiting conditional-use STRs from being within 600 feet of each other.

Michigan

State Representative Joey Andrews is finalizing a legislative package to regulate short-term rentals in Michigan, with a vote in the House potentially occurring next week. The proposed laws would empower municipalities to impose limits on the number of short-term rental properties except allowing outright bans.

The legislation introduces a statewide registry for tracking rental activities and addressing ordinance violations, alongside a 6% excise tax on short-term rentals. The tax revenue would be split equally between local governments, to address tourism-related expenses, and Pure Michigan, a state tourism initiative that has lacked stable funding for a decade.

Chagrin Falls, OH

Chagrin Falls has rolled out its first short-term rental regulations, requiring property owners to register by December 12 or face potential enforcement actions, including misdemeanor charges. The new rules, enacted in August, apply to rentals of 30 days or fewer and require property owners to submit an application, pay a $100 registration fee, and complete a safety inspection for fire and carbon monoxide detectors.

Thus far, about half of the 20 identified short-term rentals have complied, with the village sending final notices to non-responders. Registration is mandatory, and failure to comply will result in legal actions as a last resort. Once registered, property owners will receive a certificate that must be displayed inside the rental.

Rindge, NH

A proposed zoning amendment in Rindge has been modified to allow short-term rentals to host up to three guests per bedroom, after discussions during a public hearing. The new language clarifies that short-term rentals are considered commercial uses and will require Planning Board approval, including evaluations of septic systems, water supply, parking, and occupancy limits.

A second public hearing will take place on January 7 before a March vote on the final amendments.

South Haven, MI

South Haven’s City Council has extended the moratorium on new short-term rental permits for six months, continuing the pause initially set to end in December.

The decision came after a divided council discussion, with some members expressing frustration over the delays in finalizing the new regulations. The extension is intended to give more time to create a well-balanced ordinance that addresses both personal and business short-term rentals.

In addition to the moratorium, the council approved a zoning ordinance that will introduce a cap of 534 rentals and zoning overlays in certain districts. This ordinance will now be reviewed by city attorneys and the planning commission before returning to the council for approval.

Del Mar, CA

Del Mar has introduced new regulations that will make it harder for new Airbnb and vacation rental owners to enter the market. In September, the City Council passed rules limiting the number of short-term rentals to 129, which represents 5% of the city's housing stock.

The rules also require new short-term rental owners to be primary residents, meaning they must live in the property for at least six months each year. Existing rental owners are exempt from these rules, but the new regulations are seen as a way to protect the city’s housing supply and ensure tourism doesn’t push out full-time residents.

Portland, OR

The Portland City Council delayed a vote on new safety requirements for short-term rentals this week, after hearing concerns from both city officials and operators in the rental market. The proposed rules would affect about 200 to 300 short-term rental properties in commercially zoned areas, requiring costly safety upgrades such as sprinklers and fire wall separations. The council postponed the vote to give more time for review and to weigh the concerns of both sides.

Los Angeles, CA

Los Angeles is facing ongoing challenges with illegal short-term rentals, as thousands of unregistered listings continue to operate despite the city’s 2019 Home Sharing Ordinance. Officials say they need more staff to enforce the rules, which require STRs to be registered and rented out only as primary residences.

City leaders are exploring options, including a system modeled after New York City, where platforms must verify compliance before processing bookings. However, smaller hosts argue the current system is overly complex and punitive, while some council members, citing budget constraints, have suggested creative alternatives like empowering residents to pursue legal action against illegal operators.

Houston, TX

Houston officials are moving closer to implementing short-term rental regulations after years of steady growth in the market, including a 19% increase in listings across Bellaire, West University, and Meyerland since 2019. The proposed short-term rental regulations will return to the Quality of Life Committee on Dec. 9 at 2 p.m. for discussion.

The proposed rules include mandatory registration, insurance, and a fee for short-term rental owners, with penalties of $100-$500 for noncompliance. Registration could also be revoked for repeated nuisance violations or criminal offenses, with properties delisted from platforms like Airbnb. Final regulations could be presented to City Council by late 2025 or early 2026.

Escondido, CA

US Short Term Rental Regulation Updates 12/4/2024

Communities tackle short-term rental challenges with new measures. Escondido, CA, proposes a school buffer; The Dalles, OR, strengthens occupancy limits; Eau Claire, WI, debates stay minimums; and Waukegan, IL, revises fines and fees while retaining distance requirements for balance.

STRisker - Short-term regulatory changes and newsGenelaine Urbano

Escondido’s City Council has approved its first-ever short-term rental regulations in a 4-1 vote, establishing a pilot program to begin in July 2025 and expire three years later unless extended.

The program introduces strict requirements, including permits, business licenses, transient occupancy tax payments, and the designation of a 24/7 complaint contact. Rentals will be limited to 2% of the city’s housing units, capping the number at 942, with a phased application process beginning with 200 applicants. A controversial provision bans short-term rentals within 500 feet of schools, affecting approximately 30 properties, sparking criticism from property owners and managers.