Threat of Short-term Rentals to mountain towns

How do they compare? If it means more tax on working people than no. I know a few airbnb owners here in flagstaff and these aren't big time millionaires from Phoenix. I do know that taxes and the brackets are bullshit though. I have a friend that just got a promotion at her city job, this pushed her just over the line into the next tax bracket and now she makes less money.

The whole tax bracket thing is a myth.  You pay in each bracket for the set income amounts.

Since STR's compete with motels, hotels, and other lodging businesses, they should be paying the same taxes so that competition is fair.  One should also need to get a permit/license to operate a lodging business if planning to rent more than a certain number of days per year.

raisingarizona wrote

How do they compare? If it means more tax on working people than no. I know a few airbnb owners here in flagstaff and these aren't big time millionaires from Phoenix. I do know that taxes and the brackets are bullshit though. I have a friend that just got a promotion at her city job, this pushed her just over the line into the next tax bracket and now she makes less money.

Clearly you don't understand how tax brackets work.  The only way that is possible is if she got hit with AMT and that has lots of other things that would have to happen to kick into effect.  

Coach is absolutely right. I was going to say the same thing but thought it not worth the debate

snoloco wrote

Back when you had to go through a rental agent, it was more difficult to make money off of these short term rentals because you had to pay the agent.  They also likely had standards for what condition the property needed to be in to be rentable and will be more cautious about who to rent to.  If a rental agent rents the house to a prom group that decides to have an out of control party and wrecks the house, the owner will likely put the blame on the rental agent.  While some STR hosts are careful about who to rent to, others just don't care if they have a party house.  Rental agents had to assume that everyone cared about who to rent to.  Now that one can just throw a listing on airbnb, it makes it so much easier to do, so there has been a huge increase in these short term rentals.  The town that I live in has also seen a huge increase in STR's and there have been complaints about people leaving food garbage outside after a party and it attracting bears.  Most of the hosts live in the city and bought second or 3rd houses up here for the sole purpose of renting them out.

It is way easier to grade properties with the internet. It is also easier to grade the people who rent the properties. There is now a level of transparency that did not exist before these systems became popular.  As an owner, I have had issues with rental agents over the years when there were problems with renters. The only realistic thing you can do is drop the rental agent. Ski area rentals on the East Coast have mostly been seasonal or weekends/holidays. When I was renting my unit for weekends, I would be lucky to get a full week rental - besides xmas and presidents week. There are also certain weekends that are less rentable.

snoloco wrote

Airbnb, VRBO, and similar sites were originally developed to allow people to monetize downtime on real estate.  Because it's so easy to use, you get these wealthy "brokers" buying up everything they can get their hands on and renting it out to make even more money.

Why is making money a problem? If you have capital and you choose to go into the RE rental world, should you not be allowed to make money? FYI - its not so easy.

snoloco wrote

Since STR's compete with motels, hotels, and other lodging businesses, they should be paying the same taxes so that competition is fair.  One should also need to get a permit/license to operate a lodging business if planning to rent more than a certain number of days per year.

I agree with this. Juniors been learning.

I'm ok with that. I really don't have any idea but I'm open to learning.

x10003q wrote

Why is making money a problem? If you have capital and you choose to go into the RE rental world, should you not be allowed to make money? FYI - its not so easy.

That's not the problem.  It's that these things are literally hollowing out residential neighborhoods and turning them into resort villages.  How would you feel if the street you lived on was now filled with STR party houses?  We have areas that are zoned as residential for a reason.  Short term rentals are a workaround for zoning rules as hotels and motels need to be in areas zoned for commercial use but STR's don't.

I hope that the tax and regulation structures will catch up.  If hotels should be regulated then AirBnB should be too. If cabs need to be regulated then Uber should be too.  

As long as the rules are the same, I think you have to allow it.

I guess the issue is really zoning as sno points out.  But if you zone it out of your neighborhood those same rules already apply to hotels.

Great topic for a thread Z. If OK with you I'd like to change STR to Short Term Rentals.

Harvey wrote

I hope that the tax and regulation structures will catch up.  If hotels should be regulated then AirBnB should be too. If cabs need to be regulated then Uber should be too.  

I would agree, but it hasn't been like that for a long time. Hotels pay lodging taxes, while a weekly rental does not (at least in NJ). It has been that way long before Air B&B.Cabs in NYC need a medallion, which is expensive. A car service that picks you up at the airport does not. and that has been the case long before Uber.

I'm also for fewer regulations, but with STRs, I would support basic safety regulations.

tom

snoloco wrote

x10003q wrote

Why is making money a problem? If you have capital and you choose to go into the RE rental world, should you not be allowed to make money? FYI - its not so easy.

That's not the problem.  It's that these things are literally hollowing out residential neighborhoods and turning them into resort villages.  How would you feel if the street you lived on was now filled with STR party houses?  We have areas that are zoned as residential for a reason.  Short term rentals are a workaround for zoning rules as hotels and motels need to be in areas zoned for commercial use but STR's don't.

We are talking about resort areas. If you buy in a resort area, there has ALWAYS been the possibility that the house next to you will be a rental (seasonal/weekly/weekends). STRs did not invent party houses.

I do not live in a resort area so I do not have to worry about STR, seasonal rental , or weekly rental party houses.

Harvey wrote

I hope that the tax and regulation structures will catch up.  If hotels should be regulated then AirBnB should be too. If cabs need to be regulated then Uber should be too.  

Agree, 100%.  For those with VRBO, how is your insurance affected?  I think you can rent a place out something like 19 days before rates go up?

I don't see this as a new argument for expensive living in mountain towns, or any happening place, really.  It's about supply and demand.  As it always was and will be.  Now with social media and travel being affordable/easy demand for these old "unknown towns/areas" is even higher.  

It ain't the wild west anymore, people have been there, seen it and #share it so the whole world can see how #rad they are which is the reason it's getting even more crowded people know it's there.  And when the crowds come to check it out... people fall in love because mountain towns are sweeet.

Trains, Roads and Airplanes were the real threat to mountain towns.  Once people had easy access they started a demand for STR... CONDOS & Hotels.  Then consumer spends 10-20k and realizes... Hey why don't we just buy a place here?  Now demand for HOUSING goes up.  And prices go UP.  So carrying costs/mortgages are higher...

IDK I just see AirBnB as the new scape goat rather than the tourists buying up the real estate.  It's progress and unfortunately it's not all positive for all people.

It does suck for Hotels/Motels.  The internet is vastly changing EVERYTHING.  There will not be physical banks in 10 years... cars, houses, dog supplies are all purchased online for a cheaper price than physically..  Who is going to adapt first and figure out a way to make a living?

raisingarizona wrote

How do they compare? If it means more tax on working people than no. I know a few airbnb owners here in flagstaff and these aren't big time millionaires from Phoenix. I do know that taxes and the brackets are bullshit though. I have a friend that just got a promotion at her city job, this pushed her just over the line into the next tax bracket and now she makes less money.

Good Lord.  What other fundamental mechanics of income taxation completely elude you?  Posts like this make me support voting literacy tests.  I really don't want this guy voting.  If he can believe that nonsense, what other fanciful and baseless beliefs inform his choices in the voting booth?

We get the government we deserve.

^^

Why not educate me then instead of insulting me? I'm not an idiot but I'm fine with admitting that I don't know everything. So what about that post bothers you so much?

Look, there's no harm in not knowing that (although, really.....dude.  I'll bet you think that if you die without a Will, all your property "goes to the state".)  But it does indicate that you're really clueless about fall-off-a-rock simple concepts of income taxation yet I'll bet you have pretty strong opinions about income taxes (ie:  "I do know that taxes and the brackets are bullshit though.")  So your opinions and views about taxes and "the brackets" are grossly misinformed yet you march those opinions right in to the polling booth and start pulling levers.  Garbage in/garbage out and we end up with Trump for President and the other side nearly nominating an asshole like Bernie Sanders.

The Great American Experiment will end not with a bang but with a million idiotic posts on social media.  

🍿🍿🍿

IMO part of the reason that these services became popular is because the rental agencies were doing a horrible job.  I see it up here, they will put anyone in your house if their check clears the bank.  By doing it yourself you can screen who you are letting stay in your place.  The people that rent their places themselves have a better clientele than the people that rely on agencies.   Like most people I can see both sides of the story.  At then end of the day I think everyone should be on a level playing field.  If you are using your property like a B&B you should be pay taxes in the same manner.  

evantful wrote

The point is that its alittle ridiculous for you to take some image you created of a generation and mischaracterize the group as such. Then you try to say, in spite of your generation having no issue with 'free lunch', that you aren't amongst them.

Welcome to the world of arguing with PeeTex and some of the other boomers on this board:

https://www.mcsweeneys.net/articles/im-a-baby-boomer-and-im-mad-that-the-world-isnt-a-stagnant-rock

I agree with the people that say that STRs should be subject to the same taxes and restrictions that hotels operate under and, by extension, Uber & Lyft should be subject to the same restrictions as cab companies (including "The Knowledge" in London: https://www.washingtonpost.com/news/dr-gridlock/wp/2016/01/04/uber-drivers-dont-have-to-take-londons-legendary-driving-test/).

I say that not because I feel bad for Marriott, or Hilton, or Wyndham, or whatever huge Hotel Company is hot these days, but because it's awful hard to argue that the individual STR owner is doing something different than those hotel companies (they're both renting rooms to people, and if we've decided that such activity should be taxed, then we must tax each renter equally).

Unfortunately, I don't really know how to enforce such taxes. If Air B&B is forced into charging local taxes, people with rush over to HomeAway. If HomeAway is forced into taxation, people will go to WarmShowers. There will always be a new home share site popping up. Even if caught, home owners probably wouldn't have to pay. People will just say: "this guy is my buddy and he was just staying at my place for a couple of nights."

Only solution I see that's workable is to eliminate all occupancy taxes, sales taxes on hotel rooms, and any other taxes that Air B&B rental owners are exempt from. Then tax the hell out of land for everyone, homeowners and business owners alike. Maybe that's not a solution. But we have to start taxing things of value. And it seems to me that in some of these mountain towns, the most valuable commodity is land (even though there are usually enormous expanses of it within a 20-40 minute drive, especially out west).