Woodfin considers restricting short-term rentals, wants to stave off investor groups

Woodfin is considering restricting short-term rentals and has launched a study to determine its current number and the impact on its housing market.

The town currently has zoning ordinances similar to Asheville prohibiting short-term rentals — such as those found on Airbnb and Vrbo — in some zones, but according to Vice Mayor Jim McAllister, these ordinances were not enforced by the previous administration, and the Town Council is concerned that more short-term rentals mean fewer homes for families.

Town residents with short-term rentals are not necessarily the concern of the council, McAllister said, but council is worried that investor groups will buy up houses as soon as they go on the market before families have a chance to bid.

"We get a lot of complaints about short-term rentals, but we also understand that many Woodfin residents have a short-term rental, either part of their house or another house, and that's how they pay their bills, that's how they're saving for their kids' college, so it's a two-edged sword," he said.

Short-term rentals take homes away from those looking to live in them, and in an increasingly tight housing market, McAllister said the council would rather focus on families who want to move to Woodfin. Rising prices of short-term rentals have an effect on local housing prices, according to past USA Today network reporting, in what has been dubbed the "Airbnb Effect": when local Airbnb listings increase in price by 1%, rents increase by 0.018% and home prices by 0.026%.

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According to AllTheRooms, a vacation rental search engine with short-term rental analytics tools, Woodfin had 252 short-term rental properties in August, 94% of which are full-home rentals. According to 2020 Census data, Woodfin has 2,495 households.

"We need families to move to Woodfin," he said. "We don't necessarily need any more short-term rentals. The town is packed with tourists."

Due to North Carolina legislative and court decisions, McAllister said it is difficult for towns to regulate short-term rentals. In April, the North Carolina Court of Appeals ruled the city of Wilmington was violating state law by keeping a registration system for its short-term rentals, citing a statute that says no local government may require rental property owners or managers to obtain any permit or permission in order to rent.

Asheville restricts full-home short-term rentals to resort zones, not residential zones, though residents can rent out one or two bedrooms in their homes with Homestay permits, as long as they live in the home full-time. These permits were changed after the Wilmington case from requiring yearly inspections and renewal to now requiring a one-time permit fee and proof of regulation compliance.

"We're not the only town facing this dilemma. I network with all the town leaders around Western North Carolina, and we're all wrestling with this," McAllister said. "Towns like us, our hands are tied pretty tightly by the legislature, so we're frantically gathering what data sources we can."

The town is using tax records, specialized web searches and town halls to try to get an idea of how many short-term rentals Woodfin currently has. Buncombe County collects a hotel occupancy revenue tax from all short-term rental properties in the county, but McAllister said the county refuses to give Woodfin the addresses of those properties. Buncombe County Director of Communications and Public Engagement Lillian Govus said the county does not have a database nor could it make one.

"Pursuant to changes in NC General Statutes and a recent court decision involving the City of Wilmington in the NC Court of Appeals, Buncombe County does not maintain a registry or database on short-term rentals," Govus said in a statement. "We also do not have the ability to mine this data through our permitting or Tax Collection software."

McAllister said although the county claims they have no way to get information on short-term rental numbers or addresses, he believes there must be a paper trail.

"Airbnb doesn't send that to Buncombe County saying, 'Hey, here's some money.' They're having to send it and designate it some way," he said. "They're still required to submit the tax to the county, so what the county might be saying is, 'Yeah, we do collect it, but we're not giving out that information to anybody.' That could be the bottom line"

A town hall was held on June 28 with short-term rentals as a topic of discussion. According to the flyer, the Town Council asked the question: "Are short-term rentals (STRs) like Airbnbs an issue in Woodfin? If so, would you support changes to limit what parts of town they could operate in?" According to McAllister, the town hall had a full house, and the council heard both sides of the issue. Another Town Hall will be held sometime in October or November, he said.

Even without any aid from official documentation, McAllister said it is easy to spot which houses are being used as short-term rentals.

"They have characteristics. ... Yesterday, sure enough, there was a family putting suitcases in cars, and probably today or tomorrow there will be a different set of cars pulling up with suitcases and dogs," he said.

After data is collected, McAllister said the town would begin looking at existing ordinances restricting short-term rentals.

This article originally appeared on Asheville Citizen Times: Woodfin considers restricting short-term rentals, says vice mayor