Featured Government Real Estate

City Council Has Mixed Feelings on “Investor Unit Ban” for Short-Term Rentals (AirBnb)

The City Council is split between caution and urgency in crafting their response to the mayor’s short-term rentals ordinance, due later this month.

“My immediate reaction to a time crunch is to be restrictive and then open it up slowly in terms of what we can offer,” said District 1 City Councilor Lydia Edwards. “Let’s make sure that these are owner-occupants and that we have a 90-day limit, and let’s not have an investor category.”

The Council has until March 21 to respond to the ordinance, or have it proceed as written. The push to ban investor units from Boston’s short-term rental market raised concerns from councilors representing the city’s outer neighborhoods, which see themselves benefitting from the real estate investment and tourists Airbnb brings. In a working session last week, councilors from several districts expressed their concerns.

Image from the Alliance of Downtown Civic Groups presentation showing 70/30 split of investor units (green) to resident-listed units (yellow).

“When you talk investor units, it’s far different in Chinatown and Back Bay than it is in Dorchester,” said District 3 City Councilor Frank Baker, whose district includes most of Dorchester and parts of South Boston and the South End. “My concern is that we’re trying to cast a net over this and I think we’re going to do some harm.”

District 9 City Councilor Mark Ciommo raised the prospect of creating a pilot program that prioritized registration before regulation. Citing the possibility of unintended consequences from overly-aggressive regulation, Ciommo sought a way to further study the issue.

“We’ve got a lot of unknowns here,” he said. “I think the real heart of it is getting real hard actual data. We get the registration online. We identify who, what, where, when, how.”

Edwards said she normally supports pilot programs, but in this case the data is already available. “We should go on the data we already have. When it comes to the investor unit definition, I am very concerned with how it is eating up our neighborhoods. This is becoming a new real estate and economic model in the investor space.”

“The City Council wants to make sure not to create any unintended consequences,” said At-Large Councilor Michelle Wu, but it is clear that the city is seeing plenty of consequences already. Wu raised the prospect of using existing zoning rules to differentiate regulations by neighborhood.

“Can this be categorized into zoning so that we have knowledge of where that’s happening and we can say ‘In these geographic areas, yes that can happen. In the downtown area, that can’t happen.’”

District 8 City Councilor Josh Zakim also pointed to zoning as a way to address the city’s issues with short-term rentals. He requested more information from the city of how that might be used.

“We have existing zoning,” he said. “If something’s a hotel, I would like to see it treated like a hotel. I’d like to know if there’s additional tools you need to enforce zoning.”

“Zoning should not be the primary tool by which short-term rentals are regulated,” said Ford Cavallari, Chairman of the Alliance of Downtown Civic Organizations, “but it is a fairly easy exercise to look at zoning and see which overlays are for conditional, forbidden and allowed use.”

See more NorthEndWaterfront.com coverage on short-term rentals by searching the tag: short-term rentals

58 Replies to “City Council Has Mixed Feelings on “Investor Unit Ban” for Short-Term Rentals (AirBnb)

  1. I don’t t understand the issues people/government has with short term rentals. People who own property should be able to do as they please with what they own. They pay enough property taxes. Just another case of people having to involve themselves in stuff that doesn’t concern them.

    1. It’s not the “individuals” who own these properties that anyone really has a problem with. It’s the “investor class” (ie. corporations or llc’s) that are buying buildings in bulk, with the sole purpose of turning these properties into investment vehicles. Typically they don’t even live around here, they could be based anywhere in the country, or globally for that matter. They have no interest in the neighborhoods, the people, or the culture. It’s simply an investment opportunity. These firms take inventory off the market, driving up housing costs for those wishing to remain local. If you dig in a little you’ll likely find that most of the properties listed in neighborhoods such as the North End are owned by this “investor class”.

      1. I think you need a reality check. 90% of people who live in the north end have no interests in its people or culture. Look around, do you think these yuppies and college students care about your culture? Everyone who purchases property uses it as an investment to make money. Who are we to tell someone who buys a building for 3-5 million dollars what they have to do with it? People want the government to regulate what everyone does with their property while they are paying 20-40k a year in property tax. Get real. Oh and by the way probably 90 percent of people who own business and properties in the North End don’t live here.

        1. Zoning is done in every city/town and already tells people who purchase property what they can and can not do with this property via zoning. The are pros/cons to this and if you can not see both sides, then IMO, you are not looking.

    2. Sure, go ahead and rent to a meth lab. In most cities they have good and bad neighborhoods. In good neighborhoods there is sense of pride and respect for your neighbors. In bad neighborhoods, neighbors try to take advantage of their other neighbors. Short term rentals are no more part of a neighborhood than the rooms at the Marriot are a neighborhood. There isn’t much incentive for a short term renter to be a part of community, any more than. hotel guest cares what happens to the hotel. Whereever that 90% comes from, sounds like pure fiction, baseless.

      1. What point exactly am I missing? If you put up millions of dollars to buy property then it’s yours. Plain and simple, you own it and you should be able to do what you want with in the law. I’m not even going to entertain the idiotic comment made by T. Mobile, comparing rental apartments to “meth labs”. However I will say the thought that people who invest in properties are taking advantage of their neighbors and have no respect for them “sounds like pure fiction, baseless”. Go to other neighborhood and tell people you want to invest millions into properties and bring in tourists and they will welcome you with open arms. Only in the North End people have to complain about stuff that doesn’t concern them.

        1. I live in the NE. I own a property for living purposes, not for an investment. I choose to raise my family here, so yes, I have a vested interest in working to keep the integrity of the neighborhood. I have no issue with someone looking to make some extra money via Airbnb. Where I take issue is when unknown corporations can buy up properties in large bulk, putting a strain on the housing/rental markets. Not necessarily all communities, but certainly I have issue with this taking place in a neighborhood like the North End. If something like that is allowed to go unchecked, ultimately over time, it could gut the neighborhood from the inside out. I have an airbnb across the street from me, evidenced from the lock boxes that at one point were place on OUR rail, to serve their “hotel” guests. Constant trash because they don’t understand, or choose not to follow the rules. Imagine 2 or 3 of those on every block, then 3 or 4 on every block…..

        2. I agree, Big Jay, that “you should be able to do what you want within the law.” The issue here is new law is needed to protect long-term resident housing stock and communities in part by restricting the unregulated use of housing as hotels.

      2. You miss an important point, many short term rentals are in small buildings or houses where the owner lives too, they are often vital members of the community, it’s not all about guests.

  2. If these entire buildings are owned by a single entity and used as short term rentals (with, let’s say an average stay of <= 7 days) then are they not essentially "hotels" and shouldn't they be taxed and regulated accordingly? That would seem to make the most sense to me.

    1. Hotel use is restricted by the Zoning Code to certain areas of each neighborhood, including certain areas of the North End. The restriction is intended to, promote, preserve and protect other uses, such as long-term residential housing.

  3. Big Jay. RU really that clueless? Buildings that are all Airbnb units are HOTELS. People who rent these units do not care about the neighbors, noise, when trash is supposed to go out, etc. Unlike Hotels there is not a number people can call to complain about these people who are screaming like drunken idiots at three in the morning or who put trash out whenever they feel the need. In addition to being really annoying, they deplete the RENTAL stock which results in higher rents. Get your facts straight because you have no idea what you are talking about

    1. Local realtors, including Anzalone Realty, have facilitated whole building being sold as Airbnb’s. They use Domio, a management company from NYC, to clean and manage for them so they don’t look dirty. These local realtors are taking advantage of our strong housing market to make a profit at our expense (filthy street and gutters at least)while still acting like they care about the North End.

  4. I have watched a ride of absent new landlords turn whole buildings in the north end into Airbnb’s. They do not clean outside their locations, have no responsibility for noise or quality of life usurps etc. As a neighborhood, this new advent of Airbnb has had measurable and bad effects on life.

    1. Neighbor,
      I’ve seen this too but it’s from condo owners who move in and out of their condos every year or two and only care about the inside of their unit or their re sale value. Air BNbs are not the cause of every urban issue.

    2. I’ve seen this too but it’s from condo owners who move in and out of their condos every year or two and only care about the inside of their unit or their re sale value. Air BNbs are not the cause of every urban issue.

  5. Regardless of locale, the short term rentals still reduce available living space within the City and increase the cost of living for those who cannot afford to own. As the cost of living increases, it will chase away the available pool of labor which will cause labor rates to rise. When this happens, the City’s costs will rise to attract labor. If you feel that you pay enough tax now, expect to pay more or expect fewer services as the lack of availabilty of labor will affect the size of the labor force.

    1. Look at it another way Mark, short term rentals are helping home owners who have lived here for 3 and 4 decades keep their homes affordable. Great city’s are made of long time invested neighbors, not just the wealthy condo owners.

  6. From reading this article, it appears that the electeds are backing away from solving this issue. Our own seems to backing away from the absentee rental short-term rental properties. Not sure what she means by eliminating the “investor” class, but these properties are the center of the problem. The trepidation in dealing with this thing appears to be the influence of money.

    1. It’s interesting that most of the councilors opposed to regulating short-term rentals, or sitting on the fence, represent Boston neighborhoods outside the downtown areas. There has been an unofficial policy and official practice started in the later Menino years and greatly expanded by Mayor Walsh to sell off the downtown neighborhoods (neighborhoods represented by ADCO) to raise the City coffers and allow the City to move the resident population to the outlying neighborhoods, including but not limited to Dorchester, Allston and Brighton. Short term rentals can bring in loads of money, directly if taxed, but also through the spending by short-term visitors. The outlying neighborhoods need the investment, but this seems to be at the cost of losing downtown neighborhoods and communities to the highest bidders. Even the outlying neighborhoods may suffer, as their housing and other living costs increase.

      1. Yes the move to out lying neighborhoods largely was due to their affordability as the inner city neighborhood became so expensive. The neighborhoods should be thought of as working class neighborhoods. Improvement in these places will come by driving out drugs and gangs. The coucilors are short sited if they see a solution in Airbnb. It will further reduce and make unavailable the best housing stock, while not fixing the problems in the worst neighborhoods.

  7. T-Mobile, you have misunderstood the position of our city councilor. Eliminating the investor class means that this category of short-term rental would not be allowed. This is what has been done in other major cities and this is the position which has been supported by ADCO and its member civic associations. When Lydia Edwards talks about being restrictive, she means that she is not in favor of the various loopholes and exceptions which have been proposed and which would make it easier for investors to circumvent the rules. She has been a strong advocate for residents on the short-term rental issue. Some of the other councilors, as you correctly point out, not so much.

    1. An earlier article describe classifications of owners, in terms of rules that would apply to them. In this article we are talking about prohiting investors from using properties for short-term rentals as opposed to the previously described special rates that would apply to investors?

      The term “class” is confusing me with the classification scheme described earlier.

      1. T. Mobile, you and many others have hit on a missing piece of the proposed law. The proposed law is intended to allow short-term rentals under certain restrictions and conditions. What the law as written does not do – but should – is explicitly state that short term rentals not fitting into these specific allowances are prohibited. By removing the investor class, which is what Councilor Edwards and a few other councilors are advocating, investors would be prohibited from using residential housing for short term rental.

        1. Thank you for the clariffication. I was confused and concerned that the investor class would be exempted as opposed to prohibited. I did see that some councilors were looking at zone rules. This would be as leverage, should these types of operations should be deemed as comercial?

        2. The huge problem here is that the owner of a 3 or 4 family house may be considered part of the investor class in terms of his other two rental units. I’ve specifically had angry ADCO and low income housing advocates tell me that the two other apartments in my house are investment units and that I should be prohibited from taking them off the long term rental market. This seems like an extreme and hysterionic view.

        3. I’ve specifically had angry ADCO and low income housing advocates tell me that the two other apartments in my house are investment units and that I should be prohibited from taking them off the long term rental market. This seems like an extreme and hysterionic view.

  8. From what I have heard, the owner / occupant of a triple decker house in Dorchester or 4 family south end brownstone could be labeled an investor and prohibited from short term rentals since he only lives in one of his apartments , this would be devistationg to owners who rely on such income to keep Home ownership affordable. The city council need to carefully differentiate between corporate investors and owners of 2, 3, or 4 family houses.

  9. Some may ask why owner occupant landlords have turned to short term rentals,? it’s not greed, it’s due to over building in some Boston neighborhoods. Example: after 25 years of easily keeping my 3 family fully occupied it’s now become a challenge to attract tenants when leases expire, short term rentals are the only way I have been able to keep the building full, several of my neighbors have apartments that often sit vacant for 2-4 months before renting, that happened to me 2 years ago and I almost fell behind in my mortgage and taxes. The city has to encourage people like us to hold on to our homes.

    1. You can certainly find yearly rentals if the price is right…there’s a balance, you just have to find it. I own (and occupy )a 3 family in the North End and had to lower my rents to attract tenants given the glut of new buildings in the North Station/Waterfront area. But I certainly didn’t have to drop the rents enough to make maintaining my home unaffordable.

      If the building is owner occupied, why would anyone want to rent it as an AirBnB. Short term rentals ruin your home/building. Even if the occupants are respectful the constant luggage being brought in and out of the building trashes it.

    2. You bring in a different perspective and a different point of view from someone from another neighborhood. From the sounds you are more like a bread and breakfast. The issue in this neighborhood are speculators and absentee landlords who rely on neighbors to clean up their mess, don’t control their tenants and become a general nuisance to the neighborhood. This is the image of the investor in this neighborhood. Someone such as yourself wouldn’t put up with this in your building. But, if you saw it happening right next door how would you feel? Really this is trying to target callous owners. And yes we have callous owners that rent long term. This something that we struggle with too. What we don’t need is a whole new class of absentee vultures. Do you see the destinction?

      1. I do indeed, thats why I feel privately owned and hosted rentals should not be outlawed, the new laws could target the bad guys and leave the good guys alone. I encourage legislation, I also don’t want anonymous property owners recklessly managing the building next door.

    3. Why do you think the city has to encourage people like you to own 3 units? Market forces will dictate cost, rent, mortgage, supply, demand. If you’ve owned your building for 25 years but it no longer makes financial sense, then you might want to look at options.

      1. what the city needs to encourage is people like me staying in their neighborhoods and homes for decades, its called stability of community, Many longtime homeowners are “looking at options” as you mention, when we are priced out of our own neighborhoods who do you think will replace us?
        High priced condos with a revolving door of owners every 2-3 years.

  10. I don’t think anyone really thinks the issue is owner/occupants. The fact the the owner is on-premise is a huge plus in alleviating most of my and others’ concerns. The biggest issue is with the corporate investors and absentee landlords, and I agree that any legislation should take that important distinction into account.
    As far as maintaining occupancy, isn’t that just a market and pricing issue? If a unit is not renting (or selling) fast enough, lower pricing will usually fix that.

  11. I think it needs to be up to the owner if an air bnb is appropriate for their own own building or circumstance, the above writer has no right to question how such use may or may not “ruin” ones building, Good landlords don’t allow that to happen, bad landlords don’t care . For example, I greet every guest personally and they receive a pre check-in letter explaining that they will be staying in a quiet private brownstone, I’ve noticed that the more time I put into keeping things top notch the more respectful our guests are.
    Lets not forget that most home owners who rent out apartments are doing so to help make ends meet and it’s not with the goal to financially or socially destroy a neighborhood, it would obviously be nicer to just live in the whole building if it where affordable.

    1. You’re still missing the point of the “investor class”. It’s not all about you. There are corporations coming in and buying up entire buildings for the sole purpose of renting out as airbnb. Maybe not in your neighborhood, but in the NE it’s becoming a problem. These LLC’s have no regard for the neighborhood or the neighbors, and typically don’t live locally. You seem to be confusing you’re one circumstance with a much larger and growing problem.

      1. I’m not confused at all, I’m saying that more carefull legislation could easily help to ban or curb non hosted rentals by absentee landlords but also allow home owners to host guests in their own 2 or 3 family homes. What this current proposal says is that unless its your own apartment, its going to become illegal.

      2. I agree with anonomous. This investor seems to imply speculators grabbing real estate for the purposes of exploiting the condo association resources or City resources to maximize their investment. These types of operations are expanding like wild fire. They are causing affordable housing to disappear. Ever wonder what is driving the costs in your neighborhood? You have already admitted you wouldn’t want one of these types next door; well they are next door to somebody.

  12. And as far as the people who complain about tourists dragging suitcases up and down the block or unknown people entering and exiting their building, that’s a simple fix: don’t live in a neighborhood popular with tourists or choose to live in a building that prohibits short term rentals or sublets, if you don’t like people you don’t know try a gated community. There are neighborhoods in Boston where tourism is rare and it’s not common for outsiders to come in and stimulate the local economy, as city councilor Baker noted at a recent meeting “ we are not seeing this problem in all neighborhoods and if anyone wants to visit dorchester, spend the night and patronize our restaurants and shops, we want you!,

    1. Have you looked around? The North End economy was/is robust long before short term rentals became an issue.

      1. that may be true for the north end but this is a city wide ordinance, there are neighborhoods in Boston that would love to see visitors come in and stimulate the economy a bit, almost none of that currently happens in Dorchester and Roxbury for example. According to city councilors short term rental guests are the only overnight visitors in neighborhoods like Roxbury and Mattapan since hotels don’t even exist, these residents welcome anyone who wants to visit and spend a little money there. It seems that you only care about your neighborhood.

        1. Yes…I do only care about my neighborhood. You need to put industry and something commercially viable in those areas before people will want to “vacation” there.

          Dorchester is coming around…but if the residents of neighborhoods want more visitors, give them a reason to go there…no one is going to want to rent an AirBnB in Mattapan if there is nothing interesting to attract them. I’m not saying there is or isn’t but you need something other than cheap rents to attract visitors.

          1. I think you miss the point that many home owners in Dorchester, South Boston, Matapan and Roxbury currently use short term rentals to supplement their mortgage payments and have been doing so for years, we are afraid new legislation will outlaw this. What you said about only caring about your neighborhood is the problem, you only want what’s good for you and are pushing for a city wide ordinance that effects ALL neighborhoods, not just yours.

            1. You also don’t seem to realize that many air bnb guests are visiting for family gatherings, births, weddings etc. I have had numerous parents and grandparents stay with us for example before and after births, these are the types of guest who stay in Dorchester, the south end and Mattapan. We don’t require advice on how to become commercially viable, we just don’t want regulations that might work on the waterfront to be imposed on the quieter outer neighborhoods.

  13. Air Bnb Watch is the group that is spending millions to influence neighborhood groups across the nation, here is what one person asked on their web site:
    AirbnbWatch, please have the courage to post on your timeline exactly who your backers such as American Hotel & Lodging Association, LAANE and others. Please explain that they are masquerading as “community” groups but are really political lobbyist for the highly profitable hotel industry. These groups want more high profit hotels and could care less about the middle class that are having trouble paying there rent and mortgages.

    1. Glad you’re able to run a hotel and avoid hotel and short- stay taxes, but maybe the party is over. Your term as a tourist roach motel maybe over. If you wonder why you don’t have a neighborhood and neighbors, ask yourself, maybe you’re the reason why.

      1. When a homeowner like me rents out one apartment in his own building (the thats been called home for decades) it can hardly be considered a tourist roach motel, such histrionics are not helpful as the city tries to find a way to pass legislation that addresses the needs of residents in ALL the boston neighborhoods. As for neighbors, we still have a handful of people on my block who have owned their 2 & 3 family homes for decades, these tend to be the most engaged and caring residents of the neighborhood, many are being forced to sell out and leave due to the expenses of ownership, the supplemental income a short term rental can bring in can often mean staying in the neighborhood for another 10 or 20 years.

  14. I’ve lived in this neighborhood for quite sometime and I have to say the AirBnB guests are far more respectful of our neighborhood and culture than many of the college students and other 1 year rental tenants.

    I’m not saying have no regulation. That’s not my expertise. I can say tho that the AirBnB tenants are not this neighborhoods issue.

    Actually, if more AirBnB means less Suffolk “dorms” then bring em in lol!

Comments are closed.