HOW DOES AUSTIN REALLY FEEL ABOUT SHORT-TERM RENTALS?
WHAT YOU SHOULD KNOW
At 2 a.m. on a Thursday night, Kristen Hotopp, resident of East Cesar Chavez neighborhood, can’t sleep. Her walls vibrate from the bass of a stereo nearby as the screams of teenagers echo throughout the street. She reaches for her phone to make yet another call to the local police.
Hotopp and hundreds of homeowners in the city of Austin say the effects of short-term rentals have devastated their neighborhood.
“Living next to a commercial STR has destroyed my family's quality of life,” Hotopp says. “It has compromised and devalued my biggest life investment—my home.”
Hotopp, who feels overwhelmed by the number of STRs in her neighborhood, explains how disruptive the homes are to families when they are being rented out for bachelor parties and late night gatherings.
In February 2016, the Austin City Council passed a restrictive ordinance placing limitations on the business of Type 2 STRs. This type of STR is classified as a single-family home that is rented without the property owner on site.
The new rewrite of the city’s land development, CodeNEXT, enforces strict STR regulations and allows them for the time being. The plan aims to phase out all Type 2 STRs in the city by 2022.
Alex Frazier, who rents an STR in Austin every other weekend with his friends, says he does not see the difference between having people rent the property for a few days at a time or having people living there permanently.
“We treat it like our own home,” Frazier says. “Yes we party and stay up until 2-4a.m. playing games or just getting back from the bars, but we aren’t disrespectful. We act how we would at home.”
Large companies who advertise STRs, such as Austin-based HomeAway, claim to have paperwork in place which enforces a no-tolerance policy for disruptive behavior among renters. An ongoing campaign called Stay Neighborly provides guidelines to remove homes that violate local noise and nuisance regulations from the HomeAway website.
HomeAway spokeswoman Ashley Hodgini says despite the restrictive ordinance, the company isn’t convinced STRs are going away forever.
“In other areas where they have passed those policies they have achieved terrible compliance, it’s really difficult, if not impossible to enforce,” Hodgini says. “There’s not a city in the world that I know of which has successfully implemented a complete ban in Type 2 STRs. It just doesn’t work.”
Hodgini says that for some people, renting their home is the only option when it comes to covering costs due to the high price of living in Austin.
“70 percent of our owners use all or most of their income from short-term rentals to cover their mortgages so this is a make or break deal for property owners in central Texas,” Hodgini says.
One of these owners is Jay Reynolds, who relies on the income from guests staying at his rental homes in South Austin to survive. What started as a side project quickly became his main source of revenue when he realized how much the use of STRs was growing. During popular Austin events, such as South By Southwest and Austin City Limits, he can guarantee income he would have never made if he chose to pursue his dream of being in the music industry.
“The income from my properties pay my bills,” Reynolds says. “I've already transitioned to several 30-day furnished rentals in preparation for the ordinance. I would never leave Austin or stop doing what I do. I believe it's still the hottest rental market on planet earth.”
Republican State Sen. Kelly Hancock recently proposed a bill that, if passed, would standardize STR regulations statewide. The bill would prohibit Texas cities from disallowing them entirely.
Regardless of this potential legislation, the city of Austin has stated it will not be reversing the current ordinance at this time.
Since the ordinance is extremely controversial and highly contested, it will likely be taken to the Supreme Court. Until then, Kristen Hotopp will have to endure the revolving door of party animals visiting her neighborhood every weekend.
RENTERS V. NEIGHBORS
A LOOK INSIDE ESTHER HOUSE
