ETA for the time-challenged: Click this link to read a 250-word summary of the key points in this post, published as a letter to Eugene Weekly in the December 19, 2019, issue. [Late-breaking correction: Delete <Many of these houses are owned by outside investors (including dozens by Expedia).> The map prepared by City staff used the word <owned> when it meant <listed>.]
When I moved back to Eugene a year and a half ago and began encouraging Seattle friends to visit me, I was surprised but pleased to see hundreds of Eugene listings on Airbnb. My friends could have much to choose from — everything from a campsite in a backyard ($20/night) to an entire unoccupied 6-bedroom house at $500/night. (No one chose that.) [Note: As of 1/13/20, this listing has dropped to $350/night … either an indicator that it was overpriced, or a seasonal fluctuation — rainy January is likely not the most popular time to visit Eugene.]
I was surprised because — like many longtime residents — I did not think there would be that much demand. Eugene wasnt All That, after all, not like Seattle or San Francisco.
That was before I realized how much Duck fever had transformed this <large small town> where I attended college 35 years ago. In those days the University of Oregon Ducks were a perennially losing team, the <Fighting Duck> was a joke, and college athletics were largely ignored by everyone I knew. (What is now the Duck Store, at the edge of campus, was called the University of Oregon Bookstore and sold books, not hundreds of varieties of green and yellow sportswear.)
Nowadays, it turns out that scads of parents, alumni, and others in town for a Ducks game keep many of the small-scale short-term rentals (a room in a house, a backyard cottage) full. They are listed on a host of platforms, including Airbnb, VRBO, HomeAway, TripAdvisor, and Booking.com.
On a more concerning level, STRs have become an industry. Hundreds of multi-bedroom houses in Eugene are now being rented to groups of out-of-towners as STRs, with no owner on-site to supervise — a nationwide phenomenon. A map prepared by City staff (see page 4 of the slides presented at the September 23 work session) graphically demonstrates the size of the industry in Eugene, with more presumably to come.
Expedia also owns the STR platforms HomeAway and VRBO, and has more recently acquired several platforms focused on short-term rental of apartments, a new market that its competitor Airbnb had already begun to exploit. According to an article on Skift,
In 2016, Airbnb began to coax multi-family housing owners into permitting their residents to rent out their places in exchange for a cut of the tenants’s rental revenue. By August 2018, the startup had signed up nearly 16,000 units worldwide to its Airbnb Friendly Buildings Program.
Expedia’s acquisition shows that its target market of properties is increasingly blurring with Airbnb’s…. In the early days, Airbnb focused on helping people to rent out their homes or apartments on a short-term basis, while HomeAway has emphasized whole home vacation rentals in resort destinations. In recent years, though, the companies have been targeting all aspects of the rental market.
In a more enlightened, renter-friendly Eugene, these larger, now-investor-owned houses would make excellent co-living residences, especially if managed by a local company or nonprofit patterned after companies such as Community Room Rental of Charlotte, North Carolina, which partners with homeowners to deliver rooms at more affordable rents than individual apartments.
In Eugene, oversight of STRs has so far been limited to requiring owners to pay a Transient Room Tax; no licensing or permit is required (page 3). Because of a statewide law, the proceeds of the tax fund cultural services, rather than affordable housing as in at least some other states.
How many are there?
Table 1. Eugene Airbnb listings as of Nov. 1, 2019
|Price per night||Number of properties|
|TOTAL LISTINGS (between 1 and 6+ bedrooms each)||1,154|
Other sites with entire-house/apartment Eugene listings include:
- HomeAway and VRBO: 198 (presumably the same set of properties, as both platforms are now owned by Expedia)
- TripAdvisor: 68
- Priceline: a smattering are shown on the Citys map
- Booking.com: 11
(At the Sept. 23 City Council work session, staff reported finding 823 Eugene listings on Booking.com, but we found just 47, of which only 11 were vacation homes or apartments; most were actual hotels or motels.)
How many are entire houses/apartments?
We saw no precise way to determine this using Airbnbs too-simple categories (selecting entire place yields a long list that includes hundreds of backyard cottages as well as hundreds of entire multi-bedroom houses), but a scan of listings at various price points suggested that at least a third of the 1,154 Eugene Airbnb listings are entire houses with no owner present. This estimate is likely too conservative; in New York City, to cite just one example, entire-homes/apartments constitute 51% of Airbnb listings and 75% of its revenue.
Why is this a problem?
Eugene, and the entire West Coast, has a severe shortage of affordable housing. We need to create much more, but we also need to preserve the housing we have. The short-term rental industry has already removed thousands of bedrooms from the Eugene housing market and is poised to increase exponentially, especially given the much-anticipated World Track Championships in 2021.
- A recent Airbnb press release noted that Eugene had “a 213% increase in year-over-year bookings for the upcoming year.”
- Eugene is the #1 wish-listed West Coast destination on Airbnb for 2020. In the entire US, we are second only to Milwaukee(?). In the world, we are #7.
What other cities have done
Many studies (NYC, Canada, Los Angeles) have shown that STRs lead to a rise in rents and reduce the number of affordable housing units. At least 32 jurisdictions in Oregon now regulate them, with Eugene now the largest municipality in the state to be asleep on the issue.
- Ashland, Bend, Portland, and Salem (pages 7-10) have enacted regulations that were cited by City staff in their recommendations to Council
- Santa Monica (2015)
- Enacted rules that staff is reportedly using as another model.
- San Francisco (2017)
- Airbnb hosts must register with the city online.
- New York (2018)
- STR companies must provide the city with addresses for their listings, names + addresses of hosts, and whether rental is a room or an entire house.
- Los Angeles (2019)
- Hosts must register with the city and pay an $89 annual fee.
- Hosts are limited to one listing only, and it must be their primary residence.
- Seattle (passed in 2017, took effect in 2019)
- STRs are capped at two per owner.
- Hosts are taxed $8-$14/night; proceeds fund affordable housing 💞 + the citys STR licensing program. [Currently, the Eugene transient-room tax funds cultural services. Affordable housing seems to us a more appropriate beneficiary.]
- The City tweeted that its goal was to “limit mass conversion of long-term housing for Seattleites into short-term rentals, while still allowing people to rent out their homes.” We hope to elect City Councilors in 2020 who understand the need to protect Eugenes rental housing stock.
Upcoming City Council action: Dec. 11
This summer the Eugene City Council finally directed staff to look into regulation. Council held a work session on STRs on Sept. 23 and scheduled another on Dec. 11 at noon to consider a draft ordinance. According to the December South University Neighborhood newsletter and staff comments at the November Housing Policy Board meeting, the draft ordinance will include at least the following items:
- Yearly license fee.
- Owner-occupancy requirement — for instance, the homeowner must live on site at least 275 days/year.
- Limit on the number of days a unit can be rented — for instance, 90 days.
- Basis for license revocation, including number of complaints per calendar year.
- Requirement for STR platforms to maintain a registry and ensure that hosts have a business license + collect transient-room tax (TRT). Santa Monica and Portland already have such regulations. According to The New York Times, Seattle, San Francisco, and London all require STR platforms to share data through a registration system for listings. New York City is currently being sued by Airbnb and HomeAway over its approach.)
- Parking requirement. (Why we generally dont support parking requirements.)
There have been indications that Airbnb is organizing its hosts to lobby against regulation, and at least one Airbnb host is running for City Council (Kate Davidson in Ward 2, who gushed about the merits of Airbnb when interviewed by Eugene Weekly about her candidacy).
Concerned Eugene residents who back responsible regulation to protect Eugene from further exploitation by this burgeoning industry are encouraged to write letters to the editor of the Register-Guard (firstname.lastname@example.org; guidelines + deadline) and Eugene Weekly (email@example.com; guidelines + deadline) and cc your City Councilor.
Also consider testifying for 3 minutes at the next City Council public forum on Mon., Dec. 9, a few days before the Council work session. In this curious and time-consuming public ritual of Eugene democracy, signup to speak begins at 7pm, but arriving earlier to get in line is likely advisable if you want to speak early in the evening, as 350 Eugene members will be doing the same to testify on the Climate Action Plan. You may wish to connect your comments to climate action/sustainability — for instance, protecting our rental housing means workers will be able to afford to live in Eugene rather than commute from less-expensive areas, thus lessening our areas greenhouse gas emissions.
A final note
It seems important that Eugene coordinate STR policies with Springfield. If Eugene clamps down on STRs but Springfield does not, STR activity might simply move to Springfield, and have the same deleterious effects on that community.
ETA 12/12/19: In an all-too-common response when faced with a needed policy change that some of its constituents have organized to vocally oppose, at its STR work session the Council refused to take immediate action to protect housing for Eugene residents, instead appointing an advisory committee to give it recommendations by the end of March (staff had already given it recommendations based on regulations in other Oregon cities, including Ashland, Bend, Portland, and Salem) and postponing its own action till possibly as late as July 2020, during which time even more of our housing stock can be snapped up by this industry and partitioned off for tourists only. Read more about it here.