Short Term Rentals are not legal in Culver City, but with 264 Culver City listings on AirBnB, that might not be obvious to the uneducated observer. Short Term Rentals have changed the landscape of the hospitality industry over the last five years, and Culver City needs to decide if and how they will change the local landscape in the immediate future.
The community meeting offered by the city on September 20, 2018 at the Rotunda Room at the Vets Building was well attended. With hardly an empty chair to be found, the meeting represented a chance for people to get information and share some thoughts, as well as come out of the closet.
One member of the SRT Task Force, Council member Daniel Lee, offered a quick ‘icebreaker’ where audience members were asked to remain standing the longer they had lived in Culver City. The crowd average was more than ten years. How many were hosting short term rentals? Plenty of hands went up, even with the understanding that there were admitting to doing something wrong. So the picture that began the meeting was that plenty of people who have lived in Culver City for years were renting out space online.
While the average charges listed locally were $138 a night for a vacation home rental, and $75 a night for a room rental, (along with a 90% occupancy rate, ) some hosts offered that they charged less than that. Still, that came to an annual total STR fees of more than $5 million dollars leaving a possible $700,000 in Transient Occupancy Tax, (the guests-per-night tax that the hotels pay to the city) off the table.
The presentation offered information on several other California cities; Manhattan Beach, Santa Monica, Berkeley, Pasadena and Sacramento as to the status and evolution of their STR regulations. While these cites had similar demographics to Culver City, they had also had similar issues in the amount of residential offerings online.
In addition to AirBnB, companies like HomeAway, Pillow and FlipKey also offer the option of renting a house or a room online. Some hosts list their property on multiple platforms to maximize occupancy. The upside – that these cheap rentals boost tourism and create a new slice of local income, was shadowed by the downside – that people who are just visiting do not treat property or neighborhoods with the consideration that they would if they lived there.
Many of the cites had drawn the line on the kind of rental they were willing to accept. Hosted stays, or room rental with the host being present, were more often accepted than vacation rentals, where guests had the property to themselves and the host was off site.
The challenge, from Sacramento to Santa Monica, was about enforcement. With a small section of police resources available to deal with investigating infractions and violations of the laws, cities were in a response mode. Only after neighbors complain is there any action taken, despite the fact that the terms of the rental itself are not legal.
At the last City Council meeting to discuss the matter in June of this year, several who spoke from the audience pleaded that they needed to rent the space to make the money. Everyone understands that housing is expensive, and the council did not want to be in the position of making things harder. But the statistics support – throughout the state – the STRs take rental units off the market, exacerbating an already difficult situation.
As popular as it is, it’s still a black market deal. Several people who spoke to CulverCityCrossroads.com were willing talk at length of their perspective as hosts, or as the unhappy neighbors of hosts. No one wanted their quotes to be attributed. Raising your hand in a meeting is one thing; actually making a statement and putting your name to it is another.
When and how the city moves forward with regulations remains to be decided, although there is no talk at all about just keeping it against the law. It’s a matter of what regulations we want to live with, and if those rules can be enforced.
Tonight’s City Council Meeting (Sept. 24, 2018) includes an action item on the “Approval of a Voluntary Collection agreement with AirBnB for the collection of Transient Occupancy Tax on Short Term Rentals.”
SRTs in Culver City – it’s no longer if, it’s just how.