GREAT BARRINGTON — A proposal being considered by town officials would significantly change the way short-term rentals such as Airbnb and Vrbo are regulated in the town of Great Barrington.
The proposal, crafted and revised by selectboard vice chair Leigh Davis, would forbid operators of short-term rentals (STRs) from renting residential units or rooms not located within the operator’s primary residence or on the same tax parcel as the operator’s primary residence.
Click here to read Davis’ proposal, as presented at Wednesday’s meeting of the joint Selectboard–Planning Board housing subcommittee.
See Edge video below of Wednesday’s Joint Subcommittee on Housing. Fast forward to 35:20 for the discussion on STRs:
“This is not an outright ban on short-term rentals,” Davis said in explaining the proposal. “It’s more of a community-first initiative.”
Davis explained that, at any given moment, Great Barrington has a “zero rental vacancy,” which “means there are no rentals available or they get snapped up quickly.” The proposal would allow primary residence operators to rent out their home, rooms in their homes or accessory dwelling units, such as a gatehouse or an in-law apartment above a garage
Davis’ proposal, she said, encourages Great Barrington residents to enter the STR market, while discouraging “real-estate speculation” by those outside the community.
One of the benefits to the community, Davis said, is that her proposal will preserve the character of residential neighborhoods and that STR operators who live on the properties they are renting are more likely to be responsible landlords than absentee operators. Under the proposal, those who violate the bylaw would be fined $1,000 per day.
At a subcommittee meeting earlier this month, Davis had raised the possibility of restricting short-term rental owners to full-time residents. She suggested this would discourage out-of-town investors from buying up homes to offer on the STR market, taking those properties off the long-term rental market and/or driving up the cost of home ownership for full-time residents.
As for enforcement, Davis said she has identified a company, Granicus, that monitors STR activity online. Information collected by Granicus can then be compared with official records because STR operators must register with both the town and the state.
Davis insisted her proposal would not necessitate new taxes or permit fees: “This is a fine-based model rather than a fee-based model.” She acknowledged that the proposed fine might seem “extremely high” to some people.
“Some might think a small fine is the cost of doing business,” she said, adding that any leftover funds could be used to pay the software company fee, which she said was just short of $10,000. “We’re trying to deter.”
Subcommittee chair Pedro Pachano of the planning board said Great Barrington has about 2,830 households with a full-time population of approximately 7,000 people. Of those 2,830 households, 34 percent are rentals. Of those, roughly 180 are available for short-term rentals.
“That’s 19 percent of rental stock and just 6 percent of all of our housing stock,” Pachano said.
Pachano also said it would be difficult to know the status of the owners of the properties. Are they Great Barrington residents, out-of-towners, investors, businesses, second homeowners? And are the STRs really starter homes that could function as affordable housing if they were not rented out as STRs?
Pachano also said there is evidence that STRs, which are taxed like hotel rooms, helped to make up revenues lost from the town’s rooms tax on hotels. The hospitality industry took a huge hit during the pandemic.
“This is a thoughtful proposal,” Pachano said. “I’m just not sure that it’s necessary.”
Davis pointed to a billboard on State Road across from Plaza Package urging homeowners to “monetize your vacation home.” The advertiser is the MerGo Group, which bills itself as “Your All-In-One Real Estate Investment Solution.”
MerGo actually did a case study on a Great Barrington rental home in an undisclosed location whose owners “have seen average utilization rates of over 60 percent and an annual return of almost 25 percent (as of August 2020).”
Davis said many businesses in town have struggled to reopen in the wake of the COVID-19 pandemic, and that the affordable housing shortage has surely exacerbated the situation.
But several landlords and business owners who spoke at the meeting suggested a different kind of disruption. If the number of STRs dwindles as a result of Davis’ proposal being enacted into law, there will be fewer visitors to patronize the town’s restaurants and retailers. Others suggested second homeowners were being “vilified.”
“This is going to do a lot of harm to the service community,” said Justin Henderson, who rented out an expensive STR on Hurlburt Road and was issued an order to stop renting the property out for commercial purposes. “It’s just going to end up getting repealed.”
“This presentation is not balanced,” added Peter Frank. “It did not consider the effect on business in town.”
“I found this presentation to be somewhat offensive … because you’re basically telling people who own houses but don’t live in town but support the town, ‘Screw you. We don’t want your business,” said Leo Stempf.
Ron Blumenthal, a Great Barrington businessman and developer, buys homes in need of repair, fixes them up, and either rents or sells them, but does not do STRs and does not consider himself an investor.
“We all want the same thing. I’ve lived her for over 20 years,” Blumenthal said. “I don’t Airbnb houses, but I don’t want to be told how to run my business. I’ve spent millions rehabbing houses.”
Blumenthal insisted that the proposal would not strengthen the long-term rental market. Of the monitoring software Davis had suggested, Blumenthal likened it to “a police state.”
Members of the subcommittee ultimately agreed to refer the proposal to a joint meeting of the planning board and the selectboard. If the two boards decide to put it on the annual town meeting warrant, still to be decided is whether it would be offered as a town bylaw or a zoning bylaw.
Changes to the zoning code require a two-thirds majority vote at town meeting and only full-time Great Barrington residents may cast ballots, so out-of-town STR operators would have no say.
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