Asheville – Fighting bans by either the City of Asheville or Buncombe County, owners of short-term rentals (STRs) have made many arguments through the years. Jonathan Wainscott, a regular at city council meetings, simply told members of council that it’s none of their business whether his aunt stays a few nights or a stranger pays him for a room. Others told how the extra income is helping them make their mortgage payments, keep the homes nicely maintained, and even pay a maid to clean up after guests. Then again, some have just always dreamed of being the hostess with the mostess, welcoming strangers, and enjoying the potential for rich cultural exchange.
Pulled from the commissioners’ April 2 agenda was a request to move forward with a program that would pay STR hosts to rent long-term instead. The program, which could cost as much as $390,000, was billed as helping to create more affordable housing. “That’s crazy,” said Chip Craig of Greybeard Realty during general public comment.
Julie Nelson said she had set up her STR “responsibly, legally, and peacefully” and was neither a nuisance nor a threat to health and safety. Others spoke of market forces and how people don’t necessarily bend to hyperregulation, but many have already broken and fled to build or rent elsewhere. One man said he runs a property management business that employs about 20 people. After he was laid off, he bought a cheap house and fixed it up to rent for supplemental income. It brought in enough revenue for him to buy acreage and start a farm, which now has livestock. He said he knew a lot of people in farming who could not afford to do so without the income from their short-term rentals.
Shortly after the meeting, an ad campaign was running on social media, directing readers to the website noban4buncombe.com. “Don’t kill the economy,” reads its oversized home button. Along with the 30-minute social media spot, the page links to a few articles, like one in Wired with the headline, “6 Months after New York Banned Airbnb, New Jersey Is Doing Great.” The page has also uploaded an economic impact analysis for STRs in Buncombe County. While publishing the least bit of its contents requires prior consent, one significant finding reproduced elsewhere was that, in a regression analysis of housing prices and inventory vs. 17 variables, neither correlation nor causation was found for STRs.
The media campaign is supported by the STR Trust, which argues that the county has failed to produce data substantiating its claim that STRs significantly impact the availability of affordable housing. To the contrary, reducing the number of STRs was not among the nine recommendations for increasing the supply of affordable housing mentioned in the Dogwood Trust Housing Needs Assessment (2021). Furthermore, STR Trust finds fault with the math in the go-to analysis for the affordable housing crisis, the Bowen Report (2020). STR Trust said that, in quantifying the financial temptation to convert traditional rentals to STRs, the report used inflated rents and 100% occupancy rates to arrive at revenues four times actuals for STRs.
The STR Trust contacted AirDNA for assistance when Buncombe County claimed 5,269 STRs were operating within its jurisdiction. AirDNA listed only 1,919 in zip codes without municipalities. Adding back properties outside municipalities in “municipal” zip codes would not account for the difference, so AirDNA concluded the county probably tallied all properties that were rented at any single time through the year instead of performing a point-in-time count.
Back to economic impact, the Buncombe County Tourism Development Authority found STRs did $230,434,382 in business in FY2023. These revenues are subject to the 7% sales tax plus the 6% room tax. Taxes are also paid by tourists as they shop, dine, and visit attractions. Airbnb owners, in addition, pay property taxes on their rentals, and their hires pay income taxes. Did prosperity not align with the commissioners’ strategic goals?
Speakers asked the commissioners to look before they leapt. The mere existence of STR Trust, which is affiliated with the Land of the Sky Association of Realtors and NC Realtors, bodes the potential for class action on grounds of takings. On top of that, NC Senators Tim Moffitt and Bobby Hanig submitted a bill last April that would (redundantly from a strict Constitutional standpoint) limit the powers of local governments to regulate STRs. Denying citizens their rights to peaceably enjoy their property while government sorts things out is as antithetical to good governance as trying to make broad-brush economic decisions where unique, personal discretion is warranted.