San Francisco Increases Enforcement Against Corporate Hotelization

San Francisco SHort-Term Rental Permit

Credit: Adithya Sambamurthy/The Bay Citizen

[Alvin Brickman for Metrosetter Wire]

David Chiu, President of the San Francisco Board of Supervisors introduced a law that was passed earlier this month that empowers residents to take action against neighboring short-term renters.

According to Joshua Sabatini of SFExaminer:

“The legislation creates an administrative hearing process for the Department of Building Inspection to evaluate complaints and empowers residents with the ability to seek legal recourse by enlisting the services of nonprofit organizations.

While Chiu’s effort tackles one housing practice that residents have cried foul over, it does not address the emerging “shared” housing services, such as Airbnb, that tenants can use to rent out portions of or entire apartments for short- or long-term stays.

Chiu said he is working to come up with regulations for these services. One proposal being examined is a process for neighbors to complain about visitors’ behavior to ensure that the services are not displacing long-term tenants. Another addresses how to tax such a business model” (2012).

Short-term rentals has clearly been bifurcated into two subgroups: (1) “Corporate hotelization” and (2) “shared housing.” The “shared housing” subgroup is a more complex issue — with many dissenters — and more difficult to regulate, but I suspect that, ultimately, the official regulation will be similar to Austin’s permit-requirement, coupled with a complaint process for neighboring residents. How effective such a regulation will be is, on the other hand, totally unpredictable, which is evidenced by Austin’s property owners’ complete disregard for vacation-rental laws over the past month.

Airbnb has hired David Lantman, Yahoo’s head of government relations, to assist in their struggle with local laws; and San Francisco, one of the company’s biggest markets, will likely be the first city he focuses on.

Also noteworthy is that “corporate housing” (for stays of longer than 30 days) has been exempted from regulations (both in San Francisco and in Austin), which indicates that the point of exigency in the whole issue is really the 30-day mark. Stays of 30-days-or-more — in apartment buildings with four or more units (in San Francisco) — are established as either corporate housing or month-to-month renting, whereas anything less encroaches on the field of hotels and is thus qualified as “hotelization.”

Works Cited

Sabatini, Joshua. “Board Approves Housing Rule That Will Target Corporate Hotelization.” SFExaminer.com. SFExaminer.com, 16 Oct. 2012. Web. 23 Oct. 2012. <http://bit.ly/WHjNUM>.

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