The state will not impose registration requirements on residents who operate shared apartments and other short-term real estate rentals after Governor Dan McKee recently rejected proposed legislation to that effect.
Officials in the surrounding cities expressed skepticism as to whether a registry would actually work or become another source of income for the state simply by charging a registration fee. The state admits that it lacks the staff to carry out compliance checks.
“I think it’s good that they leave it to the community,” said Jamie Gorman, construction clerk and zone enforcement officer in the city of South Kingstown.
His colleague in Narragansett, Wayne Pimental, a construction clerk who, like Gorman, oversees compliance with various city codes for housing, agreed.
âI’m not sure what services would come from the state. At the moment, it seems like this type of law only requires charging, âhe said.
McKee vetoed a bill last week that would require property owners to register with the state before listing short-term rentals through online accommodation websites like Airbnb and VRBO.
“I cannot support this bill because it will place an additional burden on property owners,” McKee wrote in a vetoed message. “Short-term rental issues, like other real estate / land use and small business issues, are most effectively addressed at the community level,” he said.
In recent years, the South County area in particular has seen a dramatic increase in home sharing and online services advertised by real estate agents and homeowners. These often cheaper accommodations compete with hotels for tourists or travelers’ dollars.
For individual homeowners who offer a room – or even a house – for selected days or weeks, be it by season or month, short-term rentals in private homes can offer a healthy second income, especially as travel increases with the lifting of pandemic restrictions.
The summer season in particular draws people to these accommodations and homeowners make up for other financial losses.
The idea for the state register came after a University of Rhode Island student was killed over Memorial Day weekend after an altercation on Airbnb property in Newport.
However, short-term tenants must register with the tax department. The state’s Department of Business Regulation also rejected the law due to staff shortages to enforce it.
In Narragansett, Pimental explained, community owners – as well as other forms of apartment rental – are required to register with the city for security reasons, and the city charges a fee.
Those who fail to do so risk a $ 300 fine, he said. The city does not go to properties to conduct inspections, but warnings and an official visit could come if the city receives complaints about the behavior of tenants or their guests, he said.
South Kingstown and North Kingstown, on the other hand, do not have registration systems.
However, South Kingstown has regulations that prohibit room rentals and residential building but allow a full home to be rented, Gorman said. He added that special permits are required for bed and breakfasts.
If real estate suddenly becomes hotspots for complaints or offers rentals that the city doesn’t allow, law enforcement agencies will investigate the complaints, Gorman added.
Greg Mancini, President of North Kingstown City Council, wants the government to monitor what homeowners do with their property because âthese are businesses. I think it needs some kind of supervision and it should come from the state. “
Should the state ever create such a database, these officials said their cities would tap into it because updated information would help process complaints.
Newport has incorporated short-term rental requirements into its ordinances and has hired a dedicated short-term rental compliance officer to enforce them.
The legislator’s concern about addressing this demand market, however, has some roots in the numbers, which show a steadily increasing trend.
Douglas Quinby, a senior industry analyst at Phocuswright, told Travel Weekly two years ago that “… basically anyone, anywhere with a house or apartment in their home for rent could rent it out.”
He added, âIt has proven to be something that has penetrated deeply into the mainstream. We have been saying for years that the term ‘alternative accommodation’ is out of date because it is no longer ‘alternative’. “
His observation has proven correct.
AirDNA, a company that analyzes people’s travel habits, said earlier this year that demand for short-term rentals in 2021 is beating all expectations as demand grows in small towns and target markets across the United States.
The US was said to hit a record for new bookings every month for the first three months of 2021 through April 2021, when demand (nights) topped 2019 levels for the first time since February 2020.
“This milestone marked the end of the recovery and the beginning of the next phase of expansion for the US short-term rental industry,” it said.
So far, the new offer has struggled to keep pace with increasing demand. “New campaigns from Airbnb and Vrbo should help, but will not be enough to meet record demand for this summer,” it said.
AirDNA reported that when comparing data before and after the pandemic (April 2019 to April 2021) numbers show:
- 67% more overnight stays sold in small towns / rural markets in 2021 than in 2019
- 25% more demand in both destinations / resort locations (mountain / lake and coast)
- Eight percent growth in demand in medium-sized cities
- 13% lower demand in the suburbs
- 41% lower demand for urban real estate.
Statistics for the South County market were not readily available.
On site, Robin Leclerc, a real estate agent at Residential Properties Ltd. in Narragansett that these numbers are in line with their experiences of observing leaps in the local division of housing.
She said that she has increased the number of her listed Vrbo properties by a third and that she also tells 75% of callers looking for summer vacation rental that she has no properties to rent.
Leclerc said she had mixed feelings about creating a database, as Narragansett did, but the state should leave the project to the communities.
“Use the money (from fees to registration) to help out with things like the police, when we need it in real estate, when people are not behaving well,” she said.