Short-Term Rentals

Take Our Polls

Over the last couple years, short-term rentals (STRs) have received push back from communities nationwide as the number of such rentals exploded. Many of these communities have adopted varying degrees of regulation, including requirements for business licenses, zoning permits, inspections, etc. And in some cases, jurisdictions have become far more aggressive in identifying zoning and building code violations among STRs.

What stands out to me as land use and economic development consultant is that a lot of people (even regulators) can’t wait to brag about the deal they got on their last vacation, but most people can’t agree on whether they’d want an STR next door or whether they should be regulated (if at all).

In communities where STRs are being regulated, the big questions become how to regulate them (what is the end goal), how to monitor them and enforce compliance, and how to ensure the regulation is cost-neutral to the city, especially considering that STRs help support economic development in the form of tourism.

A Local Example: Snohomish, Washington

This week the City Council in Snohomish will get a staff presentation on what’s been learned about STRs since the city imposed a set of light regulations on STRs via Ordinance 2446

¹

a year ago.

Like the national trend, Snohomish has seen an increase in the number of STRs year-over-year, but they’ve also continued to see many of the STRs not obtain businesses licenses or adhere to code.

According to a recent memo, the challenge for a city like Snohomish, which has more lax requirements that some jurisdictions, is that the cost of enforcing the regulations would be more than the direct revenue they’d create.

²

That said, Snohomish is a quaint city of a little more than 10,000 people with a vibrant downtown (centered on 1st Street) featuring a healthy mix of antique stores and purveyors of fine foods and libations. Yet the city has only one hotel, which can artificially limit the duration and amount of money tourists might spend when visiting.

Snohomish is just one example of a typical community which must look broadly at the value of STRs, especially when these community have little to no hotels in or nearby their communities.

It will be interesting to watch how the city continues to monitor STRs and what changes, if any, the city may make to their STRs ordinance in the future.

1. Ordinance 2446 requires that STRs have a City of Snohomish business license, paying all applicable retail and lodging taxes, use only residential spaces for short-term rental, limit rental to the same party for no more than 30 consecutive days, only rent to a single party (single group) gathered for the same social purpose, and only rent the entire structure or a self-contained living space (with only one self-contained living space reneted at any given time).

2. September 5, 2023 Council Agenda, memo starts at page 33.