By Grear Palmer
In New Orleans, new policies have been put in place regarding locals short-term renting their houses. Previous laws have been lenient with allowing property owners to rent every unit of a home or commercial building at one given time. These property owners were also never required to live within their respective rentals. The new regulations will allow only homeowners who live or occupy their owned house to rent them for short term. This means that, if an individual owns a house with multiple units, they are required to live full time in at least one of their units in order to rent the remainder as short term. The number of guests in both commercial and residential rentals can be no more than 12 occupants.
New laws also ban AirBnB and Homeaway in most areas of the Garden District, as well as the French Quarter. Short-term rental (STR) owners will be subjected to fines, as well as to having their permits revoked if any signs of illegal activity are present. The intended purpose of these new laws is to limit the number of tourists within our local neighborhoods.
Many locals have been in favor of the new laws in hopes of regaining control over their neighborhoods, believing that this will give neighborhoods back to local residents as opposed to tourists. Supporters also believe that networks such as AirBnB and Homeaway have caused a loss of affordable housing within our city. When outside investors are purchasing properties at inflated prices to create STRs, it drives up the cost of all local housing. People believe problems like these have caused New Orleans residents to flee the city due to these high housing costs. Residents have also realized that STRs have raised home values, which inadvertently raised property taxes. Property taxes are based on the value of an individual home. If outside investors are driving up prices, this in turn drives up property taxes. Neighborhoods believe they are suffering the disadvantages of high taxes and housing costs.
Critics of the new legislation believe that short-term renting both sides of their owned houses is a vital source of extra income. These new laws will eliminate owners who have benefitted from multiple STRs. People believe that the city does not have the right to tell them who can or cannot rent within a certain time frame. Current STR fees average about $50 to $500 depending on the size and location of the property. Under new legislation, fees will be raised up to $250 to $500 in residential areas. Prices may escalate to $5,000 per commercial unit. These high rental fees will force many property owners to find other uses for their extra property or they will have to go underground in order to rent illegally. Although rules will affect some local property owners, the majority of these whole-house, short-term rentals are owned and operated by outside investors.