Airbnb Loses Ballot Battle to Skirt Regulations in Jersey City

Voters in New Jersey’s second-largest city this month overwhelmingly upheld new restrictions on short-term rental properties, dealing a significant blow to short-term rental companies like Airbnb and VRBO.

The new regulations, initially passed by the Jersey City Council in June, were put on hold after short-term rental advocates collected enough signatures to force a referendum.

The rules limit how often landlords can rent properties, forbid short-term rentals in buildings with more than four units if the owner isn’t present, and prohibit renters from serving as hosts.

Jersey City lawmakers say the new rules are needed because the short-term rental market has changed dramatically over the past few years, leading to an influx of absentee owners and more nuisances. But Airbnb says the restrictions will apply to more than 90% of the city’s properties and will disproportionately affect renters, most of whom are minorities.

According to Wired:

The move comes as a major blow to Airbnb, which spent more than $4.2 million blanketing Jersey City in television ads, handouts, and pro-Airbnb canvassers in a campaign to quash the restrictions, which will affect a popular destination for guests looking to visit Manhattan (which is just across the Hudson River and several minutes away on public transit) without running afoul of New York’s tight rules on short-term rentals.

Jersey City’s rejection of Airbnb suggests that the tide may be changing for the so-called tech unicorn, as the city joins the growing ranks of former Airbnb defenders turned defectors. Local government officials around the nation that had been early advocates of the company, from Arizona and Louisiana to Oregon, are now turning against it.

Short-term rentals offer both positives and negatives. They can promote tourism and provide homeowners with extra income, both of which can help a local economy. However, they can also attract commercial investors — and when the concentration of short-term rentals reaches a tipping point, destabilize residential neighborhoods, lessen long-term rental options, and threaten jobs in the local hospitality industry.

Short-term rentals have been the focus of several bills introduced in the Maryland General Assembly in recent years that have sought stronger regulation and tax collection. While statewide bills have failed to address local concerns, jurisdictions such as Baltimore City, Montgomery County, and Prince George’s County have passed local legislation to govern short-term rentals.

At the MACo Winter Conference session, “Short-Term Rental Revolution: What’s Your Game Plan?” an expert panel will detail the latest trends on the fast-moving marketplace for alternative lodging.

The 2019 MACo Winter Conference, Building for the Future,” will be held on December 4-6, 2019, at the Hyatt Regency Chesapeake Bay Hotel in Cambridge, Maryland.

Learn more about MACo’s Winter Conference: