City study: Don’t blame vacation rentals for housing shortage
New housing hasn't been able to keep up with demand in Columbia Falls. since the economy recovered from the Great Recession.
BY CHRIS PETERSON
Hungry Horse News
While vacation rentals are a popular way for home and property owners to make some money during the busy tourist season, they’re not really contributing to the housing shortage in Columbia Falls, an analysis by city attorney Justin Breck notes.
Breck, drawing from a recent Bureau of Business and Economic Research as well as his own practice in property law, found that vacation rentals are often used by property owners to pay mortgages and property taxes, so they can continue to live here.
He presented a report on the subject at the city council meeting last week.
But those same rentals would probably not provide more long-term housing because those same property owners aren’t interested in long-term rental of a home or accessory dwelling.
In more than a few cases, Breck noted, people actually move out of their primary residence in the summer months and then live in a camper, RV or some other arrangement in the summer months.
The city proper has about 50 licensed vacation rentals, noted city manager Susan Nicosia.
There’s about 1,900 residences that pay a water bill in the city, so vacation rentals amount to 2.6% of all housing.
A vacation rental requires a business license, a conditional use permit, inspection by the county health department and an inspection by the fire department to assure the residence is up to code.
The property owner is also required to collect the state bed tax, have an accommodation license, and when the city’s resort tax goes into effect in October, they’ll have to collect that as well.
Columbia Falls has some of the tightest vacation rentals in the state, but municipalities in other parts of the country have done even more. One tactic is to require that property owner must be in compliance with local laws or their accounts will be disabled.
Illegal vacation rentals has been a concern in the city and its planning jurisdiction.
There’s more than 2,800 vacation rentals in the county, and Breck notes that unlike hotels and motels, vacation rental income is more likely to be spent locally and help the local economy.
Breck noted that case law concerning vacation rentals is rather thin. The city of Santa Monica, California probably has some of the most stringent requirements. It requires that the homeowner live in the same structure as the renters, in what’s known as “Homesharing.”
The law was challenged by Homeway, the parent company of Vrbo and Breck noted the the case went to the Ninth Circuit Court of Appeals and the court ruled in favor of the city.
There’s another new trend in property sharing. People are now renting out tent sites in their yards.
There doesn’t seem to be any regulations against it, unlike RVs or campers. An RV park, for example, requires a subdivision plat and inside the city, a person can stay in a RV on private property for two weeks maximum a a year.
The intent behind that law is to keep single family residences from turning into multi-family residences, Nicosia noted.