Over the last year, travelers have developed a sizable preference for short-term rentals (STRs) over hotels or other more traditional lodging options. This shift is due, in large part, to the pandemic: certain types of STR properties, like single-family homes or condos, make it easier for travelers to remain socially distant during their stay. But with the growth of STR bookings comes another trend: according to Granicus research, STR-related complaints are on the rise—increasing by nearly 250% from June to September of last year, compared with the same period in 2019.
The complaints (which range from noise violations to trash-related issues) highlight a clear and growing tension between STRs and the communities they inhabit. And when left unmonitored, STRs can have a significant, negative effect on a neighborhood’s character.
For homeowners associations (HOAs), this negative effect has become abundantly clear as renters are concentrated in a given community. But there are actions HOAs can take to mitigate these issues and keep communities thriving even as STRs become more popular. HOAs have the power to regulate and even restrict local STR activity, but many still struggle to effectively interface with rental hosts, gather evidence efficiently, or get in contact with STR guests about their activity. To that end, there are technology solutions (like Granicus’ Host Compliance) that will help set up clear lines of communication between HOAs and the STRs in their community.
HOAs cannot rely on STR hosts to mitigate the negative impacts of their guests. Hosts can ask their guests to respect their neighbors or follow community rules, but they can’t force them to. And rental listing websites aren’t much help either: historically, these platforms have done little to help communities regulate the effects of their markets or users.
So what are HOAs to do? They can start by activating the powers of their declaration of Covenants, Conditions, and Restrictions (CC&Rs). Every HOA has a CC&R and they act as a set of rules for what properties are allowed to do and not do. CC&Rs are adjustable, meaning that if a community is struggling to combat the negative effects of a growing STR market, the board of an HOA can create rules that address negative STR activity. HOAs can even add mandates to their CC&Rs that prohibit excess noise after a certain time, prevent party houses, or limit the occupancy of properties based on number of rooms.
HOAs can create applications that potential hosts have to fill out and get approved before listing their property. These enforcements tend to work best, however, when HOAs also charge STR hosts with a reasonable, annual fee. “Without a fee, it’s harder to deter people from simply downloading an app and renting their property to short-term guests,” explained John Spuhler, a senior account executive at Granicus in a recent webinar.
To enforce any regulation or rule, HOAs can levy fines or place property liens against violators. Many organizations implement escalating fines after three or more violations to deter repeat offenders. In addition to these monetary enforcement tactics, HOAs can create and staff a 24-hour hotline for citizen complaints to make sure all offenses are documented and later investigated.
Despite all the power that HOAs can exercise over their local STR market, most still have a hard time establishing effective lines of communication with owners of these properties, or gathering evidence of activity. This struggle is shared by state and local governments, as well: when a new STR appears in their area, governments and HOAs are not automatically notified.
“Community associations are not unlike a city or town in terms of STR concerns,” explained Spuhler. “They’re worried about short-term rentals’ possible effects on parking, noise, traffic, trash problems, neighborhood character, and building safety.”
To establish lines of communication with all hosts, HOAs first need to collect their contact information. To do this, they can write a regulation that requires all local STRs to register their property with the HOA. Otherwise, tracking down the details about a local rental property can be an impossible task—communities can try searching rental listing platforms for properties in their area, but because platforms hide addresses and host contact information, this tactic is largely ineffective and a waste of time. Here, a solution like Granicus Host Compliance can help: the software scans every online rental listing platform for properties in a certain area, collecting data on every relevant listing. Using this information, the solution creates “evidence points” for these properties—like pictures of a property, its offered amenities and relative location—and compares them against other known data points to find non-compliant hosts and their contact information.
HOAs can then reach out to identified hosts in their area via letters that notify them of their non-compliance and provide educational materials on what they need to do to become compliant with community rules.
In many ways, HOAs and the communities they inhabit stand to benefit from a developing local STR market. These properties can help bring in revenue to resident STR hosts during difficult times. To help minimize the negative aspects of STRs, HOAs have to first address the growing tension between their community and its STRs. They’ll have to be proactive and use their inherent advantages—like their ability to regulate and discipline STR activity—to mitigate the negative effects. Then, to ensure STR compliance, technological investments might be necessary—perhaps even crucial—to the safety and well-being of a community.
To learn more about how HOAs can help mitigate the negative effects of STRs on your local community, watch our webinar.
