U.S. rental firms and property owners fighting to protect future of short-term rentals

United States: The rapid growth of short-term rentals in the U.S. is pushing regional governments to rein in the practice but some rental firms and property owners are fighting off the lucrative industry’s threat.

It was reported in June that voters in Palm Springs, California, approved a ballot measure overturning restrictions on short-term rentals, and some state governments, including in Arizona and Tennessee, have stepped in to protect Airbnb, HomeAway, VRBO and other online platforms hosts.

However, a council vote in Washington D.C. is set to take place on Tuesday, which is expected to approve some of the toughest restrictions in the country. This would include banning short-term rentals of a second home, and Airbnb warned it may put forward a ballot initiative for voters to vote on in 2020 if the current version passes.

One business professor at New York University said: “The real story over the last year or year and a half seems to be the hotel industry waking up to the fact that Airbnb poses a much bigger threat to their business than they originally imagined.”

Even new regulations are not slowing down growth; short-term rentals worldwide grew by 82 per cent from 2012 to 2017, from 45.6 billion to 82.9 billion globally. In the same period, hotel room reservations increased by 27 per cent, from 404.2 billion to 512.3 billion.

Despite the struggle over regulation, some common ground exists over bans on multiple listings.

The bigger challenge has been whether or not to allow short-term rentals of second homes. Phoenix and Seattle have approved the practice but New York and San Francisco have banned it in most cases.

The question is a big one in San Diego, California, where the city council passed a law in July to ban short-term rentals of a second property through online platforms.

Vacation property owner Blaine Smith said: “As written, it would pretty much put us out of business. We have such a rich history of tourism and vacation rentals. It’s just crazy what happened here.”