On Tuesday, the DC Council is scheduled to have a final vote on a new home-share regulation bill for the city.
As currently written, the bill allows owner-occupied properties to be used as short-term rentals without time limits, while prohibiting the short-term rental of units that are not owner-occupied, and limiting short-term rentals in primary residences to 90 days a year when the owner is not present.
Just before the bill passed on a first reading earlier this month, Ward 6 Councilmember Charles Allen introduced an amendment which would raise the annual cap from 90 days to 120 days; the amendment failed to pass.
"The bill in front of the Council does provide some much needed framework, but an analysis by our independent Chief Financial Officer reports it will also end 80-90 percent of all current short-term rental properties," Allen said in a statement. "I don't think that's hitting the right balance." A recent article from Greater Greater Washington reinforces the point of how many short-term rentals would be lost.
DC's status as a federal hub means that there is a notable share of residents who call the city home, yet are out of town or out of the country for a large, and sometimes unpredictable, portion of a given year. Lara Hawketts and Alejandro Fuentes assist many homeowners who fall into this category through Home Sweet City, a third-party short-term rental management company.
"Because we're in DC, there's a lot of folks that are living that way, whether they work for the World Bank or for the military, and they need flexibility," Hawketts told UrbanTurf. "[By renting on a short-term basis], they can cover their mortgage. If they start restricting the number of nights they can do that, it's not going to be worthwhile."
Furthermore, prohibiting homeowners from renting out properties they don't live in may not have the intended effect on the city's overall housing supply, as property owners hosting on services like Airbnb wouldn't necessarily offer that second property as a long-term rental.
"It does not strike me as a direction I'd want to go," Karl Scarlett said of renting out his second home. He and his wife own a two-unit property in Shaw but are raising their family in Woodridge, where they also list their basement as a short-term rental. Scarlett has had some negative experiences with tenants when putting the Shaw property on the market as a long-term rental.
"There's the potential I might sell [if the bill passes]," Scarlett said, although he is concerned that many second homeowners may feel the same way, which would flood the market with homes for sale.
Airbnb has also studied the issue as the final vote looms, compiling information (see table above) on estimated lost host income should the bill pass as-is. In Ward 2 alone, the estimate is that there would be a $10 million drop off in annual income.
"This legislation would effectively wipe out most short-term rentals that aren't a basement or spare bedroom," Councilmember Allen stated, a conclusion which is corroborated by the city's Chief Financial Officer in a report on the bill. "The bill will reduce nearly all transient lodging revenue currently received from short-term rentals through booking services," the CFO report states.
We will see tomorrow whether the bill will move forward in its current iteration.
This article originally published at http://dc.urbanturf.com/articles/blog/a-look-at-the-possible-effects-of-dcs-home-share-bill/14567
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