City Council eliminates permits for full-time vacation rentals

AUSTIN (KXAN) — In a special meeting on Tuesday, the Austin City Council voted 6-5 to stop the allowance of Type 2 short-term rentals. Type 2 short-term rentals are homes that are not occupied by the homeowner.

The ordinance stops licensing any future Type 2 STRs, but those already licensed will be allowed to continue operating, at least for the time being. The council said the plan is to ultimately phase out Type 2 STRs permanently.

An estimated 250 employees from Austin-based HomeAway marched on City Hall in support of short-term rentals. The company has roughly 400 short-term rental listings in Austin. Last week, HomeAway launched a new program with a phone number for neighbors to call if guests get too loud or if they park illegally.

People waiting on the Austin City Council to vote on short term rentals. (KXAN Photo/Chris Sadeghi)
People waiting on the Austin City Council to vote on short term rentals. (KXAN Photo/Chris Sadeghi)

At least one councilmember wanted to ban Type 2 home rentals all together.  “My biggest concern about Type 2 short-term rentals, those units that are used as mini hotels, 100 percent of the time,” said Tovo. “They have transformed housing that could be available to Austin families, into hotel rooms.”

Tovo shared that sentiment with the council and jam packed council chamber during Tuesday’s work session. She cited numbers indicating 23 percent of Type 2 short-term rentals fall within the attendance zone for Austin schools, a district which is already struggling to maintain enrollment numbers.

But Brooke Andrus with Emerson Guest Properties believes that claim is misinformed.

“Correlation does not equal causality,” said Andrus. “This is an expensive city to live.”

As a property manager, Andrus manages 25 short-term rentals and said the city is trampling on the rights of those property owners and making them a convenient scapegoat for the housing crunch in Austin.

“To assert that what is already limited to 3 percent of housing is responsible for this is crazy if you ask me.”

Brian Sharples, the CEO and co-founder of HomeAway, joined KXAN in-studio to talk about how these new rules will impact the vacation rental market. Sharples said the company will send out teams to investigate and work with the city. They have launched a program called Stay Neighborly.

According to Sharples, Stay Neighborly is “a zero tolerance program aimed at cracking down on homes breaking city rules.”

Almost 200 people signed up to talk at last month’s meeting which finally wrapped up at 2 a.m.

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