NEW ORLEANS (AP) — The city council in tourist-friendly New Orleans voted Thursday to halt the proliferation of one type of tourist housing: short-term rentals such as those facilitated by Airbnb and Homeaway.
Council member Kristin Palmer’s measure affects those who rent out entire homes for short-term visitors for as much as 90 days a year. It imposes a nine-month moratorium on licenses for such rentals — including renewals of existing annual licenses— while a study is made of the effects of short-term rentals.
Backers of the measure, which passed unanimously, said large investors have bought up properties to turn them into vacation spots — driving up New Orleans housing costs, driving out residents and threatening the historic character that draws tourists in the first place.
“We were sold a bill of goods when this thing first passed — that it was going to be mom and pop,” Palmer said, referring to the council’s earlier attempt to regulate short-term rentals in 2016. Her measure does not apply to commercially zoned areas and is aimed at the city’s numerous historic neighborhoods.
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Supporting the measure, Samuel Taggart said that of 18 buildings on his block in the Treme neighborhood of the city, 12 are short-term rentals with a total of 28 units. He said two of the units are “nothing but fraternity parties on the weekend. They bring in kegs of beer and crawfish. If they do go out to the French Quarter, they come in at 2:30 in the morning and party to 4 or 5 in the morning.”
Opponents said Palmer’s measure will hurt small investors, too, particularly those whose licenses will lapse during the nine months.
“It will punish the people who are playing by the rules,” said Eric Bay, president of a group of short-term rental supporters.
Some warned of a ripple effect in the city’s economy, also hurting people who renovate and clean rental properties.
The measure does not affect permits for people who turn over part of their existing residences to short-term renters — those who rent out bedrooms or half of their duplexes.
HomeAway issued a statement Thursday disputing some of the claims by backers of Palmer’s measure, including the contention that short-term rentals have driven up prices and rents. It said it would work with short-term rental opponents to address their concerns.
“Average home values in New Orleans have been rising steadily post-Katrina, and the rate of growth has not accelerated since the legalization of STRs,” the company said in reference to short-term rentals.
Laura Spanjian, Airbnb Public Policy Director, said the vote was disappointing.
“We have worked closely with the City for more than two years to develop and implement fair rules, which provide the City data and tools to enforce the law and millions in tax revenue, and today’s vote flies in the face of the collaborative spirit with which we’ve approached our work with the City,” she said in an emailed statement.
Associated Press reporter Janet McConnaughey contributed to this story.