Seattle looks to crack down on vacation rentals

SEATTLE – The Seattle housing market is in a crisis and the City Council says it’s due in part to the short-term rental market holding properties for tourists. The council has proposed new rules that would crack down on rental owners hosting properties on sites like Airbnb and HomeAway.

The rental property owners  who Q13 News spoke to said they’re helping the economy, not hurting it. They said they're providing options for tourists, who then put money back into Seattle business, and provide much needed jobs for locals in the service industry.

“That’s the untold story here -- about the other businesses that are getting affected because our guests on average spend $3,000  in this city,” said Darik Eaton.

Eaton manages 40 rental properties in Seattle. He said the new rules would destroy his family’s business.

“These new rules would put me out of business,” he said.

The City Council is considering new laws that would require all short-term rental property owners to get two licenses, regardless of how many nights a year they rent.  Members said at a public hearing on Wednesday that they don’t want to penalize the homeowners who are renting out a space of their property, like a spare bedroom.

They said those are the people they want to keep in the system. Instead they want to stop people like Eaton who rent out secondary homes and apartments. Those, they said, are what’s contributing to the housing crunch, making up roughly 12 percent of the market.

“We actually call that walking the gauntlet,” said Kate Starbird.

Starbird was part of the minority at Wednesday’s meeting, speaking in favor of the new rules. She and her partner see what Airbnb can do to an apartment complex firsthand.

“We’re walking home late, long hall on the top of the building, nobody else is there 10 drunk men,” she said.

Starbird said her complex has gone from a community to a network of strangers passing through. She said it feels like a hotel, with almost half of the units in her building now being rented out to tourist.

“This is our everyday; every day I see 15 of you,” she said.  “Every day I might see 30 of you coming and going.”

Airbnb’s argument against the rules is that the extra licenses would create barriers, forcing anyone renting even for a weekend to get multiple licenses -- a group, they said in a statement, that makes up 50 percent of the Seattle market.

In a statement provided to Q13 News they said:

Home sharing is an economic lifeline for many Seattle residents - in fact an estimated over 350 Seattle hosts have been saved from eviction or foreclosure by hosting on Airbnb. The new proposal will create unnecessary, complicated barriers to entry, and undoubtedly depresses compliance. Under this new proposal, if someone wants to share their home, even for a weekend, they will need to get multiple licenses. Over 50% of Airbnb hosts in Seattle share their home for less than 30 days. This new proposal is a step backward for the occasional home sharer. We believe there is a better way and hope to continue working with the City to find a good solution

The council said the rules are meant to take back units and homes that are tied in short-term rentals and bring them back to the housing market. Eaton insists they can help the housing market, without killing small business.

He suggested taxing short-term rental hosts like hotels. “Have the same 15.7 percent tax and have us fund affordable housing,” said Eaton. “Make us part of the solution.”

Unfortunately, that solution wouldn’t fix the problem Starbird said she’s facing.

“Our building, we’re just a hyper-example of what might happen to an entire downtown area if it can’t be regulated,” she said.

Wednesday’s meeting was only for public feedback; the council has not determined when they will vote on the proposed regulations.

Once enacted, there will be a year grace period. One amendment brought to the council would grandfather people like Eaton in to the new rules. It would allow him to keep up to one additional property for up to 10 years; his other 39 properties would need to be sold or converted to long-term rentals.