Leading short-term rental advocates held a community discussion Thursday night on ideas for changes to the laws governing the controversial topic in New Orleans, tapping into the deep well of frustration with the city’s rental market from nearly all sides.
HomeAway — an online short-term rental platform similar to AirBnB that lists 2 million properties around the world — and the Alliance for Neighborhood Prosperity advocacy group are holding a series of public forums in neighborhoods around the city this week as part of the ongoing deliberations about the reforms to the system sought by the City Council this year. Thursday’s event in Broadmoor packed a small sunroom in the Keller library with more than 30 people — some arguing that short-term rentals are the salvation of the city’s economy, others convinced that they are the downfall of its neighborhoods, and still others just there to listen.
“Our concern is that several persons ran on the platform of what they’re going to do about short-term rentals, and they don’t have a clue of what to do about short-term rentals,” said Penelope Randolph, a short-term rental host in Treme and member of the Alliance for Neighborhood Prosperity. “Those of us who live in the neighborhood, who have been operators in the neighborhood, or neighbors of the operators in the neighborhood — we are the people that need to be coming up with the suggestions of how that legislation ought to look.”
The advocates had a cluster of general policy recommendations for reform, but said they would be modifying their proposals based on the input from the discussions. Among their suggestions:
- Non-resident property owners should be limited to only two short-term rental permits, though residents could apply for more. Only two would be allowed per block, and the total number citywide should be limited to 6,000, or about 3 percent of the city’s housing units.
- The ban on short-term rentals in the French Quarter should be lifted to reduce pressure on other neighborhoods.
- Blighted properties should be exempt from the limits for a five-year period, to encourage their redevelopment.
- Rental hosts should be required to respond within an hour to any complaint by neighbors or face penalties.
- The per-night rental fee should be expanded to hotels.
- The collection process should be streamlined and made easier.
The advocates’ proposals drew a wide variety of responses. One woman said that after real-estate speculators in her neighborhood couldn’t sell their house flips for the prices they wanted, so they turned them into short-term rentals. Now, she is inundated by a scourge of “half-naked women” with their “bras hanging out,” and tourists who treat her like an animal in the zoo because she is a local.
“Nobody asked me if I wanted my neighborhood to turn commercial,” said the woman, who refused to give her name to a reporter.
The woman said her preference would be to ban the practice altogether, or at least allow each block to decide by vote whether to allow it.
Renate Heurich, a neighborhood leader from Milan, agreed that short-term rentals should be dramatically reduced to decrease pressure on housing prices.
“Short-term rentals just hike the price overall,” Heurich said. “They take living space off the market. It’s a simple equation.”
One short-term rental advocate in the audience, however, countered that every time a homeowner converts a shotgun double into a single-family home, they are reducing the housing stock in the same way.
“Every time they do that, they’re destroying supply,” said the man, who also declined to give his name to a reporter. “We’re going to see if banning short-term rentals brings rents down. I’m not optimistic that it will.”
Gradie Knight said short-term rentals are often in neighborhoods where the rents would not be considered “affordable” anyway, so curtailing them would not drive prices down.
“Eliminating short-term rentals in many areas does not serve that purpose,” Knight said. “Mine would be rented at market rate. In many areas in town, that does not equate.”
Alissa Schmidtke said she doesn’t have a strong opinion on the short-term rental issue, but that city land-use laws actively discourage the creation of more affordable units. She buys blighted properties and renovates them for traditional long-term rentals, but that the city won’t allow her to divide them into smaller units for rental — though she could easily convert doubles to singles.
“The policies in the city encourage you to downgrade the house to less units,” Schmidtke said.
Audience member Chris Lane said that most New Orleanians are not opposed to the kind of short-term rentals championed by the platforms, that of single owners renting out part of the home where they live for some side money. It is the rest of the business — owners with multiple properties turning homes into full-time commercial lodgings — that residents oppose, and he urged the platforms to “live up to your advertising.”
Lane also expressed skepticism at the platforms’ expressed desire to receive neighborhood input, recalling that the legalization proposal that was passed through the City Planning Commission and City Council was replaced by a different version crafted by Mayor Mitch Landrieu’s office and the platforms.
“That was scuttled at the last minute,” Lane said. “We’ve already gone through this process.”
Ashley Hodgini of HomeAway, however, said that the platforms need a workable, permanent solution as much as residents do.
“First and foremost, you have to have a policy that is capable of working,” Hodgini said. “Then, you have to incentivize people to comply.”
See above for live video of the discussion.