LACONIA — Short-term rentals marketed through online companies like Airbnb bring in millions of dollars for homeowners and the regional economy, but this emerging industry has come with a cost.
Some neighbors complain of noise and parking problems. Traditional hoteliers worry about lost business. The supply of affordable housing has even taken a hit.
In Laconia, city officials have adopted a complaint-driven approach to regulating short-term rentals, and some criticize this as well.
The marketing success of companies like Airbnb and VRBO has proven disruptive to traditional lodging establishments in the same way that on-demand transportation businesses like Uber and Lyft have turned the taxicab industry upside down.
Airbnb, which bills itself as “the world’s leading community driven hospitality company,” said in a news release that New Hampshire has 3,500 hosts who share their homes through the company’s online marketing site.
Belknap County had 21,000 Airbnb guests and $2.9 million in host income last year, while Carroll County had 72,600 guests and $8.5 million in host income, the company reported.
Rusty McLear, founder of The Inn at Mill Falls in Meredith, has learned firsthand about this new reality.
“Oh, it’s a huge issue,” he said in a recent interview. “We did a study about three months ago because we saw that a lot of our weddings – which we do a lot of weddings – an awful lot of the guests, the younger guests, were deciding to stay at an Airbnb.
Five couples who might have rented five hotel rooms from him in the past were now saving money by renting a five-bedroom house instead.
“We found out that there were 280 Airbnb facilities in Meredith, Center Harbor, Moultonborough and Holderness,” he said. "Now, 280 doesn’t sound like that big a deal, but let’s say there’s three bedrooms in a unit, so what’s happened in the last two years, the equivalent of an 800-room hotel has been built. It’s very competitive.”
While the short-term rental industry largely flies under the regulatory radar, a traditional hotel is highly regulated.
“We have certain rules we have to live under,” McLear said. “Our fire chief comes through.
“Frankly we have to spend thousands of hours and millions of dollars going through planning boards and zoning boards and getting everything approved.”
While most New Hampshire communities have taken a hands-off approach to short-term rentals, Kimberly and Carlos Guzman found out recently that Laconia has an enforcement plan.
Such rentals are generally not allowed in residential zones in the city under longstanding rules that don't get enforced unless a complaint comes in. The property owner then gets a letter from the city saying the rental is not allowed and informing them they can appeal to the Zoning Board.
The Guzmans, who live in Bedford, New Hampshire, and have a home at 77 Opechee St., were surprised when they got their letter.
“The people in Laconia are delightful, but this is very disheartening and very upsetting,” Carlos Guzman said. “We’re just trying to provide a great experience for everybody.”
He said the city got a complaint from a neighbor who never approached him directly.
Guzman said complaints should be vetted.
“If you’re going to make homeowners jump through these hoops, it should be substantiated,” he said. “If you complain about noise, there should be a police report.”
Lindsey Allen, the neighbor who complained, said guests disrupt traffic flow with the way they park.
“It’s a residential neighborhood, not a commercial neighborhood,” she said. “When I bought here 13 years ago, I didn't know there would be a business here.”
Doris Cousineau, another neighbor, said Tuesday she has no complaints.
She said Carlos Guzman keeps in contact with her to ensure that any concerns they have are quickly addressed. She said her husband often befriends the renters, as their backyard puts them in close contact.
"He's been great, he's been courteous to us,” she said. “He's been really good. He rents to good people."
Aside from neighborhood issues, there is another concern with short-term rentals — experts say they can crowd out affordable housing.
Carmen Lorentz is executive director of Lakes Region Community Developers.
“In general, the dynamics in our market are that a lot of the housing stock that would otherwise be affordable for a first-time buyer or a family of moderate income, is consumed by people using it as a weekend home or a vacation home and renting it out,” she said.“It takes up that housing resource. It’s part of our infrastructure, but it’s not available for people who actually live here and that’s a big part of problem. The housing stock is taken up by people who don't live and work here and that is driving up the costs of homes and rents under the basic theory of supply and demand.”
Josh Meltzer, head of Northeast policy for Airbnb, sent a letter to the editor highlighting the company’s economic contribution to the region.
“As officials begin to block Laconia residents from sharing their home with guests from around the world, it is critical that the Zoning Board and City Council consider exactly what they are stopping,” he said.
“By prohibiting short-term rentals, families will be denied the opportunity to earn valuable extra income by opening their doors to tourists, with the typical host earning about $9,900 per year by renting their space for 2-3 nights a month. This income can be vital, specifically for seniors, who account for about 20 percent of Airbnb’s host community in Laconia and often struggle to ‘age in place.’
“For them, home sharing could be the difference between being able to afford to keep their home — or having to leave Laconia behind.”