ABOUT SHORT-TERM RENTALS IN SOUTH PORTLAND
What is an Unhosted Short-Term Rental?
An unhosted short-term rental is the rental of an entire residential dwelling/property (single family house, condo, apartment) for less than 30 days. Tourists typically make arrangements to retrieve keys or the code to a keypad and, also typically, find a binder left by the property owner with information about parking, trash, and local tourist activities.
South Portland Ordinances 22 and 23 allow Unhosted Short-Term Rentals in Commercial Zones, but prohibit them in Residential Zones, because they meet the definition of commercial tourist lodging. A single exception has been included which allows anyone to rent their primary residence for two weeks per year while they are away.
What is a Hosted Short-Term Rental?
A hosted short-term rental is lodging where an owner rents a portion of his or her primary residence for less than 30 days. The homeowner resides onsite for the duration of the stay and is available to resolve any issues that may arise. Hosted short-term rental is currently allowable in South Portland Residential Zones as a Home Occupation, for one room and up to two guests.
South Portland Ordinances 22 and 23 increase the ability of home owners to operate Hosted Short-Term Rentals to three bedrooms and up to six guests in Residential Zones.
What is a Bed and Breakfast?
A Bed and Breakfast is a licensed commercial inn where the owner rents a portion of their residential dwelling to individuals and/or groups of people for less than 30 days, and the owner or manager is on site for the entire stay. Serving breakfast is not required. Bed and Breakfasts are subject to local and state licensing and regulations, covering zoning, taxes, fire codes, commercial insurance, food preparation safety, trash collection and parking standards. Although South Portland does not currently have any licensed Bed and Breakfasts, owners of these establishments in other communities complain that unlicensed short-term rentals compete unfairly because they avoid meeting the basic public safety standards outlined above.
How do Unhosted Short-Term Rentals disrupt and displace families?
Living next door to a house that changes occupants every few days is disruptive to surrounding neighbors and the neighborhood as a whole. Issues frequently arise with too many renters, too many vehicles, too much partying, and overflowing trash cans.
We respect the right of people to have fun on their vacations, but we believe that fun should be occurring in appropriate commercial zones rather than in neighborhoods zoned for residential living.
Worse than what you get with an unhosted short-term rental is what you lose. Every time a house is converted for lodging, long-term renters or resident owners are displaced. These are the people with whom we’ve formed relationships; the people we count on to water our gardens when we’re away, and keep an eye on the children and senior citizens in our neighborhood.
How do short-term rentals weaken schools, businesses, churches, and community organizations?
Schools: Short-term renters do not attend local schools. As families are displaced by tourists, the population of school-aged children declines. For short-term rental owners, property taxes are a major expense. Because school funding is derived from local property taxes, investor/owners of these properties are not incentivized to support full funding of our schools.
Businesses: STR guests promote a very lopsided economy. They do not use local physicians, or lawyers or accountants. They don’t bank here, they don’t buy cars here, they don’t send their kids for music lessons here, they don’t buy their clothes here (well, maybe a souvenir t-shirt). If you fill those houses with full time residents, they do all those things, plus they still spend money in our restaurants, bakeries and grocery stores, even during mud season. Full time residents also work here, contributing to our economic productivity and paying taxes.
Churches and community organizations: STR guests do not join our faith-based communities, civic organizations, neighborhood clubs, sports leagues or scouting troops. These organizations are the glue that holds our communities together, and benefit from robust participation of full-time neighbors.
Why are Unhosted Short-Term Rentals not allowed in Residential Zones?
Unhosted short-term rentals are commercial lodging enterprises, selling a service and collecting lodging taxes on behalf of the State of Maine. These properties do not meet the definition of residential dwelling because of the short duration of stay and the nature of commerce. Hosted short-term rentals are allowed in residential zones so long as they meet the standards applied for home occupation.
When first adopting a zoning strategy, back in the 1940’s, City Council established separate areas for commercial and residential activities. Commercial enterprises already existing in these zones were “grandfathered,” allowing them to continue their business as long as they operated continuously. The Council’s intent was clear, however, that no new commercial lodging establishments were to be allowed in residential neighborhoods.
If UnHosted Short-Term Rentals are not allowed in Residential Zones, why are there so many operating today? Why isn’t the zoning code being enforced?
The ease and low cost of marketing properties through e-commerce platforms like Airbnb and HomeAway has tempted many people to experiment with short-term rental. Data from Airdna.com shows that in 2010 there was just one listing, while currently there are 215 active listings. Some STR owners claim they have been short-term renting for many years before the existence of online platforms, but no one has yet provided records to show that their usage is grandfathered from the pre-zoning era.
It took several years before residential homeowners realized that nearby properties were being bought up and converted to short-term rentals at an alarming rate. In the summer of 2017, many of us began contacting the City Council and Code Enforcement Officer to voice our concerns. We found out that Code Enforcement had failed to recognize the magnitude of the problem, and had not taken action to enforce our Code of Ordinances.
From the time of the first scheduled City Council workshop on the issue, all serving City Council members have said that their interpretation of the city’s zoning code prohibits unhosted short-term rentals in residential zones. Additionally, the Ordinances 22 and 23, which will be voted upon on November 6th, 2018, received unanimous approval from the Planning Board.
Why do landlords choose short-term renters over long-term renters?
It’s the money. Property investors can make a lot more money renting short term rather than long term because their operating costs are less than licensed hotels and bed and breakfasts, because they are not subject to insurance, licensing, health and safety regulations, and staffing costs.
Doesn’t South Portland benefit financially from Short Term Rentals?
No. The City of South Portland does not benefit from any taxes or fees collected from either hosted or unhosted short-term rentals. The State of Maine collects lodging taxes from Airbnb type platforms. No substantive direct benefit is provided to the City of South Portland.
Why can’t people use their property the way that they want? This is a free country.
The use of residential property is regulated by zoning laws which establish and protect our property rights. South Portland’s zoning ordinances for residential neighborhoods state all the allowable uses for each of the residential zones (Residential AA, Residential A, Residential G, Village Residential VRl, Rural Residential RF, and Transitional Residential TR). This system has been in place since the 1940’s, with numerous updates and amendments made through a rigorous process of City Council deliberation and Planning Board review.
When someone purchases or rents in a residential zone, they accept the rules of that zone. They do not have the right to turn their home into a mini-hotel any more than they have the right to turn their home into a fireworks store, a restaurant or a petting zoo. Most of us welcome these rules as a safeguard against the actions of a neighbor which might negatively impact the quality of our lives or the value of our property. Some other people view these rules as an onerous restriction on their freedom. Frankly, we worry about these people and do not want to see what they might choose to do with their property if we did not have zoning to protect our rights.
What if a community wants short-term rentals?
South Portland welcomes short term rentals in the appropriate zones. In residential zones, only hosted short-term rentals are permitted. In commercial zones, both hosted and unhosted short term rentals are allowed.
It’s important to understand that the referendum on the current ballot is about upholding the City Council’s ordinance to license and regulate the operation of short term rentals. The ordinance in question greatly expands the opportunity to operate hosted short-term rentals in residential zones (three bedrooms and six lodgers). An “AGAINST” vote will leave current code in force, allowing only very limited hosted short-term rentals in a residential zone (one room and two lodgers). Under either the new or old ordinance, unhosted short-term rentals are only permitted in the appropriate non-residential zones. A “FOR” vote ensures that our residential neighborhoods return to, and remain, residential neighborhoods.