The Charlottesville City Council passed a resolution Tuesday initiating the process to craft an amendment to zoning text aimed at more closely regulating short-term housing rentals. The city planning commission will investigate the issue and make a recommendation.
The resolution is partially a result of the increasing popularity over the past couple of years of short-term home-sharing websites such as Airbnb, which listed around 350 spaces available in the city for anyone to rent at press time.
City Councilor Dede Smith said current zoning codes do not adequately address the issue of short-term housing and leave room for unintended consequences in the future if not revised.
“The real sticking point is it’s not really clear what you would have to do [to legally rent out your home on Airbnb],” she said. “It just needs to be better defined.”
The impetus for City Council to act on the issue came primarily from neighbors of the homes which are being rented out, who raised concerns about the effects of the frequent turnover of short-term tenants.
“There are a couple of situations that Council is concerned [with],” Smith said. “One is that a residential neighborhood will become non-residential [as a result of more transient residents].”
Smith said another cause of concern among neighbors is the growing trend of investors purchasing homes in neighborhoods with the sole purpose of renting them out through Airbnb or other short-term rental websites.
“One of the alarm bells that went off…was investors going into neighborhoods that are zoned for single family residences,” she said. “Will people buy houses just to rent them out on Airbnb, and how will this change the character of a neighborhood?”
Smith said there are a few potential solutions to the pressing issues.
“[We are] considering whether it should [have to] be owner occupied, or whether there should be a limit on number of bedrooms or people who can be allowed [to stay],” Smith said. A requirement which obligates hosts to notify neighbors about their home sharing could also improve the situation, she said.
Aside from neighbors, some long-standing, local short-term housing providers have also felt the effects of Airbnb arrangements.
Susan Lanterman, proprietor of the Leathers-Snyder Bed and Breakfast, said Airbnb has affected her business to some extent, despite her prime location on Ridge Street in Historic Downtown.
“There are weekends where I would have expected that I would have had a full house,” she said. “I think [Airbnb] will continue to affect [my business] if there is not more regulation.”
Lanterman also said an Airbnb host renting out his or her home “off the books” could draw people away from her business simply because of the cost margin.
“People who are dealing with Airbnb may or may not be paying any taxes,” she said. “We have to charge more than someone who is not recording and paying taxes.”
Lanterman said she estimates state and city transient taxes cost her guest an additional 11.5 percent on top of the cost of their stay.
In addition to taxes, she said, Airbnb hosts might skip out on liability insurance and do not necessarily have to comply with the same business regulations as she does, such as parking requirements.
“I think [more regulation] levels the playing field,” Lanterman said.
City Planner Matt Alfele said the city’s planning commission will have a work session Tuesday to brainstorm potential changes, and the city will host an open house on Thursday to get feedback and ideas from residents.
The planning commission has until the last week of May to submit a recommendation to the city council, which the council will then review and vote on.
This article previously stated incorrectly that the City Council resolution enacted an amendment to zoning regulation.
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