Buncombe Considers Incentivizing Non-Airbnbs - TribPapers

Buncombe Considers Incentivizing Non-Airbnbs

Brownie Newman pauses before making an economic argument he knows will be unpopular. Screenshot.

Asheville – The Buncombe County Commissioners can’t exactly ban Airbnbs, but they are interested in piloting a program to incentivize renting units long-term instead of short-term. At their December 5 worksession, the county’s Strategy and Innovation Director Rafael Baptista asked the commissioners if they would be interested in having staff look for an outside organization to manage a program that would pay property owners to convert their Airbnbs into apartments with long-term leases.

Baptista said staff had looked at three tourist towns that had tried this. The first, Sedona, Arizona, featuring a backdrop of the stunning Oak Creek Canyon, saw its population almost double with the advent of the New Age movement. Its Main Street now thrives with shops for Western and mystic swag, and alternative health opportunities abound. Sedona offered incentives of $3,000–$10,000 for conversion based on a unit’s square footage. Sedona elected to terminate their pilot after a year because the incentives paled in comparison to the precipitous drop in potential income. The median rent for an apartment in Sedona, according to Zillow, is now $3,200.

The second town of interest was Truckee, California. Just a few miles away from Lake Tahoe and seven ski resorts, Truckee’s mountains, pine forests, and smaller lakes make it an attractive base for visitors and second homeowners. Truckee leadership opted in 2020 to incentivize conversions ranging from $2,000 to $18,000 based on square footage and duration of stay. Homes could not be rented to anybody earning more than 150% of area median income, but leases could last as little as five months to serve seasonal workers. The median rent in Truckee is $4,800.

This program, still in effect, boasts the conversion of 150 units. Baptista attributes its success to its flexibility. It also offered higher incentives, and its management partner was “intensive” in that it proactively sought out tenants for would-be participants.

The third program explored was the fisherman’s town of Portland, Maine. According to Travel Portland, the town’s historic architecture, arts and crafts community, and restaurants drew “11.9 million overnight person-trips” in 2022. Portland used ARPA funds to offer $1,000 incentives to landlords to convert their Airbnbs into voucher-accepting apartments, whether or not they actually rented them. With a population about 6 times that of the other two “comparables” but still only 2/3 that of Asheville, Portland had a wide range of rents, the median being $2,595. This program was also terminated because, as Baptista said, “the offset did not match the incentive.”

Baptista asked if the commissioners wanted to provide incentives to landlords agreeing to enter into 12-month leases with (1) families earning no more than 50% of area median income and using vouchers, and/or (2) families earning 50%–80% of area median income and paying no more than 30% of their income in rent. Baptista also wanted authorization to start looking for a firm to manage the program.

Things were too sketchy at this point to answer Commissioner Terri Wells when she asked, “Can you explain how this incentive is supposed to work?” Likewise, it was too early to answer Commissioner Amanda Edwards’ question about whether or not the management team would help the county find Airbnb operators who are operating without county and/or city authorization.

Baptista was just providing a preliminary presentation to test commission support. “I’m your innovation director,” he said, “so the word ‘pilot’ is my favorite word, so my answer is almost always going to be, ‘Let’s do a pilot and see how it goes.’”

Commissioner Al Whitesides said, “If we’re going to meet our goals, which are hefty, we’ve got to be creative and get out of the box. If it doesn’t work, shelve it and go another direction.” Most on the board spoke as if they were willing to give this thing a whirl.

Newman, however, paused, as if trying to figure out how to make an economic argument diplomatically. He was outnumbered, and he didn’t want to rain on the parade. “We’re going to basically just buy down the price of rent from a short-term rental to this,” he said. “If you were truly going to do that, I think that’s expensive, and honestly, I just don’t see a huge uptake.” He did, however, concede that the stakes for trying the program would be minor.

County Manager Avril Pinder said staff will return with numbers, including a comparison of the per-unit cost to the county to incentivize versus construct anew. “Rafael likes the word ‘pilot,’” she said, “and we like the word ‘fail fast.’” Newman said he liked that and added that he hoped he was wrong.