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How will municipalities handle short-term rentals and the housing crisis?

On Behalf of | Jun 27, 2022 | City Planner, Municipal Law |

Communities throughout the Gulf Coast are growing increasingly concerned about the housing crisis. Local buyers are finding it harder and harder to find housing options within their budgets. The crisis has a variety of complex factors at play, one of which is the popularity of investors buying properties to use as short-term rentals for Airbnb. As the housing crunch shows no sign of letting up, municipalities are examining their options for handling the market.

San Antonio: a case study

One of the most high-profile examples of how municipalities are approaching short-term real estate investments is the City of San Antonio. As one of the major cities of the Gulf Coast, San Antonio has seen its fair share of debate regarding short-term rentals. In 2019, the city passed an ordinance requiring owners of short-term rental properties to obtain a permit. The ordinance also restricts the percentage of short-term rental properties to 12.5% per city block.

Municipalities have options, but also challenges

As the City of San Antonio has found, there is no simple answer to the question of how to alleviate the conflict between prospective rental investors and buyers who want a family home. Some of the options that municipalities could consider include:

  1. Restricting the number of buildings or units for short-term rentals.
  2. Requiring a permit to own a short-term rental property.
  3. Imposing fees on the purchase or sale of short-term rentals.
  4. Rolling back certain regulations surrounding housing development, land use and zoning.

The next few months to few years will certainly see more action from municipal governments regarding housing and development. As a popular tourist destination, the Gulf Coast area is a prime market for short-term rental investors. Every municipality will face the complex challenge of balancing competing interests from developers, investors, tourists and local buyers.



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