The Raleigh City Council Healthy Neighborhoods committee approved a draft ordinance for regulating short-term rentals, but it failed to find a consensus on what to do about whole-house rentals in the city.
Short-term rentals, like Airbnb, are technically illegal in Raleigh, but the city hasn’t enforced the ban while regulations are in the works. City officials have spent years trying to create rules for the practice. Past recommendations — including those proposed by a residents’ task force — have failed to win council approval.
The city is now considering modeling itself after Asheville, which implemented regulations restricting the short-term rental industry.
Council members Nicole Stewart, Stef Mendell, Russ Stephenson, and Raleigh Mayor Nancy McFarlane sit on the Healthy Neighborhoods committee. Stephenson serves as chair.
The draft ordinance approved by the committee allows residents rent up to two guest rooms to visitors, but requires the full-time resident to be present the entire time the lodgers stay at the property.
Before operating a short-term rental, a resident must obtain a zoning permit from the City’s Development Services Department and file for a Room Occupancy Tax Application with Wake County. Cooking facilities in any bedroom is prohibited, as is exterior advertising.
The committee scratched out a few provisions, which were included in the draft ordinance. A provision prohibiting apartment short-term rentals in residential districts was removed, as well as a section restricting the number of short-term rentals that could operate within a certain distance of each other.
The committee passed the draft ordinance unanimously, but it will still have to go through other committees before the full City Council votes on the rules. Parts of it are still open for discussion with the full council. Whether the city would require residents applying for a short-term rental permit to provide mailed notices to the owners of all nearby property is subject to change.
Stewart questioned the purpose of requiring notification to neighbors if they have no ability to affect the permitting process; Mendell said it would serve as a common courtesy to neighbors about changes in the neighborhood.
Whole-house rentals, which remain banned under the short term rental draft ordinance, is a topic of contention. The city would have to draft a separate ordinance.
McFarlane suggested allowing whole-house rentals in residential districts, but with time constraints.
Mendell said a majority of City Council members don’t support whole-house rentals, and people have told her horror stories about living next to bad actors. While the City Council heard from a couple of people who complained about whole-house rentals, the mayor said the data doesn’t suggest big problems.
“There are a lot of people doing this now with very, very few complaints,” McFarlane said. “If you look at the hundreds of people across the city who are doing this consistently and doing it well, I don’t see the need to punish all of them if they are doing it right.”
Stewart said short-term rentals have many benefits, including added tax revenue for the city, allowing families to test neighborhoods before moving in, and helping lonely seniors meet more people.
“There are so many benefits to this, and yet we want to craft an entire policy or throw the baby out with the bath water and say, ‘We heard from a few folks who really don’t like these things so we won’t allow them,’” Stewart said. “That’s kind of ridiculous.”