By Frank Gormlie / OB Rag
The San Diego Union-Tribune had veteran reporter Lori Weisberg write an extended piece on short term vacation rentals in Sunday’s “SD In Depth” entitled “Opportunity or Nuisance” (June 12, 2016). Weisberg looked at the impact of short term rentals on San Diego’s housing market and wrote – based on her research – who exactly was profiting “from the rise of the home sharing.”
Two of the immediate take-aways from her article are that more and more commercial rental agencies are dominating the short term market and that the available housing stock in San Diego is being negatively affected – even if only “gradually”.
Yet, despite all the articles that Weisberg has written on this issue and the debate that has been raging within San Diego for nearly two years – while the City Council has still not made a decision on laws regulating short term rentals – , she still has not focused on one of the key long-term effects of the short term vacation rental industry: the loss of community.
Weisberg’s piece showcases some of the individuals who are raking it in by owning or managing residential units that have been turned into short-term rentals.
One such agent is Ryan Scott, who – as Weisberg explained – owns or sublets a dozen STVR dwellings and manages another 10 – many in the beach area – including Ocean Beach. “Scott confesses that he has become addicted to the intoxicating short-term rental revenues he says his properties have been generating over the last few years,” she wrote.
“The reality is,” he told Weisberg, “you’re leaving money on the table if you’re renting to a long-term tenant.”
As Weisberg has been covering this issue, she recounted the complaints made by neighbors of dwellings or apartments rented out to short-termers, and where “tensions have erupted in urban neighborhoods, most notably in the beach areas”; all the noisy and raucous parties interrupting neighborhood lifestyles and sleep, the invasion of strangers onto quiet streets, the trash, the taking of limited parking, and the eating into an already tight rental market.
“In San Diego County,” Weisberg reports, “listings on Airbnb have grown at least 60 percent annually over the last several years …” based on data supplied by a company that tracks listings on home-sharing sites. “In just the last year, some 3,900 Airbnb hosts in the City of San Diego welcomed 185,000 guests ….”
One criticism of the STVR market in San Diego – which Airbnb executives deny – is that it “is increasingly being dominated by commercial landlords who are upending San Diego’s rental market and altering the character of residential communities.”
The Ryan Scott that Weisberg interviewed is a poster-boy for the “mega-operators” of the STVR scene. Mega-operators are those who rent out 3 or more units, and while they represent only 7% of the hosts – which was determined by a 12 city study – they account for 25% of the revenue generated by the short term rentals. The report, cited by Weisberg, concluded that Airbnb is now a platform for commercial operators – operators who are affecting neighborhoods and not abiding by the safety and security standards of the hotels.
Weisberg did interview at least one member of the group, Save San Diego Neighborhoods, Ronan Gray, who has been fighting the short-termers for years. Gray lives in PB and ever since his neighbor sold out to an out-of-state buyer, he’s been fighting the 2 a.m. hot tub parties, the raunchy language of vacationers, the threats and every other negative aspect of living next door to a hotel.
The article, over-all, however works to cast the spotlight on those profiting off the home-sharing.
People like Paul and Cecilia Abraham recounted how they liked the money coming in from one short term rental, they booted another long-term tenant so they could rent out that place as well for vacationers.
Or like Tim Riley, who after renting his 4-bedroom old Craftsman to long-term tenants for a decade, raised the rents – which forced the current tenants out, and then turned the building into a vacation rental, charging $240 a night. He likes the money so much, Riley is “sticking with his short-term experiment.”
This trend, as Weisberg, gently suggests, represents the types of changes that have “fueled the argument that long term rental stock is gradually being diminished as the home sharing economy matures.”
The Sunday article did disclose that by far most of the vacation rentals are homes (3,062) or apartments (1,959), not lofts (83) or B&Bs (86).
Just how much San Diego’s long-term rental and housing stock is negatively affected by Airbnb and the other platforms is still too confusing to figure out, Weisberg says. A supplemental article reports that a labor-backed group up in Los Angeles estimated that in March of 2015, more than 7,000 houses and apartments had been taken off the market in metro LA for use as short term rentals.
Meanwhile, here in San Diego, while campaigning for District 1 Council seat, candidate Barbara Bry claimed that 6,000 units have been lost from San Diego’s housing stock due to STVRs. She was taken to task as incorrect by the Voice of San Diego in one of their “fact-checking” episodes. Bry’s numbers have since been defended by Save San Diego Neighborhoods, in an article by Tom Coat in VOSD, a member of the group. The group strongly disagreed with VOSD’s determination that the candidate’s figures were off and has asked VOSD staff for a retraction.
Here is more of what Coat wrote:
So here is the overarching point: the number of entire-home short-term rental listings that Save San Diego Neighborhoods estimated to be operating in the city of San Diego – over 6,000 – is actually very conservative. …
In addition, the 6,000 number does not include rooms once used for long-term rentals that have now been converted to short-term vacation rental rooms. … Data shows over 3,000 short-term rental rooms – just for Airbnb – in San Diego. Clearly, a loss of long-term room rentals has a negative impact on housing stock. By reducing long-term rental supply, they add to San Diego’s dramatically rising long-term rental rates.
Entire-home short-term vacation rentals have become a very real and serious problem in San Diego and elsewhere. Short-term vacation rentals are affecting affordable housing here and in other cities. … It is indisputable that short-term vacation rentals adversely affect affordable housing. …
SSDN urges all San Diego officials who care about affordable housing to read the staff reports of those California communities that have reiterated the ban on short-term vacation rentals in residential zones. All of these cities recognized and expressed their beliefs and concerns that short-term vacation rentals have a significant impact on affordable housing….
Okay, back to Weisberg’s article – it was illuminating and did confirm a couple of things: that commercial rental companies are grabbing more and more of the short term market, and that San Diego’s housing stock is being negatively affected.
Still, we find the illumination by Weisberg limited. She still has not addressed the much larger issue of the loss of community, although it was hinted at with the realization that the short term market is affecting neighborhood character.
We go further. In a post from last September, we stated :
This ‘change of neighborhood character’ and loss of long-term rentals is very significant. But we would go further, and say that one of the greatest threats to neighborhoods along the coast like Ocean Beach from Airbnb and short-term vacation rentals is something of great consequence – literally – the loss of community. …
For one, when a good number of rental units are utilized as vacation bits of heaven, there are fewer rental units available for people looking to actually reside in the neighborhood. Fewer rentals drives up the rents.
However, on top of housing shortages, the even more drastic consequence of loss of community occurs when there are so many residential units within a neighborhood that have been turned into short-term units, that a goodly-sized chunk of the area has morphed into a resort candyland of beach, surf and sand.
There are no longer any actual residents in the immediate neighborhood, and every unit is utilized as a vacation rental – every condo, every McMansion, every apartment, every little cottage – no longer are the houses of residents – the human make-up of a community – but of visitors.
Without actual residents then, that portion of the neighborhood as “a community” collapses into a mishmash of rental and property managers, online rentals, private trash and private security details.
If it was only a rental here and there, there wouldn’t be any problems, but at the beach, that’s a dream. And of course, only the neighborhoods where visitors want to spend time suffer the most impact.
The problem occurs when for residents and local small property and home owners develop the motivation to turn their condo, cottage, second unit, apartment or house over to short-termers who will pay big bucks instead of keeping the interests of the community over that of the immediacy of cashing-in.
If there’s no one left to care about the community or that section of it, then there is no community.
Our perspective, still today. And the threat remains.
This is the same threat, now, aimed at Ocean Beach. If enough little cottages, homes, apartments are turned into vacation rentals, then this is a larger threat to the culture of Ocean Beach than gentrification.