Conway voters reject short-term rental regs

Let’s look at the $$ of the short term renting ban in Conway.

1. Using the towns number of ~500 STR properties currently in residential, average $250/night and average 200 nights a year booked/property (some more). The ban is a loss of at least $2.3M/yr. to the state in the 9% tax fee paid by owners. Less money to the state means less money to the towns. And if all tourist towns ban STRs? !

2. The gross income to owners of short-term rental properties is at least a collective $25M (and maybe as much as $40M) – much of which was staying in town.

3. Some owners are local residents that supplement their income by renting out either rooms in their homes or have a separate cottage/cabin to rent out. This ban will likely result in driving these local folks out of Conway. How is this improving the need for affordable housing?

4. Less properties to be supported by cleaning, landscaping, etc. We used to own a rental property and paid out ~$10k in cleaning fees/yr. and ~$5k in landscaping. So, with 500 properties. That’s $7.5M less money being paid to locals. So how does that help them afford to stay in town?

5. As someone else described for an average spend of $500/tourist family visit ( and many will spend more) it equates to a minimum loss of $13M to small businesses in town. So how does this help small local businesses stay afloat?

6. The desire, or thought, of some voting in favor of the ban was to place more affordable housing back into the market. This argument has been made in many tourist towns when discussing short term rentals and has been shown to be a fallacy. Currently there is a dearth of properties for the second home market and median prices have risen over 15% in the valley in the past year. The few houses that do come to market are selling at way over asking and within a few days. If some of the rental properties are put back on the market it will be at an inflated cost and will be immediately snapped up by out-of-towners for 2nd homes. So how does this put affordable housing back into the town? And the NH real estate market is expected to grow at least another 8% in 2021

7. We just voted in a yearly operating cost for the town of Conway for ~$12M + another $1.6M in sundry other articles. The town manager had already pre-warned, in a Conway sun article, that the town could not afford the full burden of everything on the ballot. Needless, all monetary articles were approved (and I’m not even adding in the school articles). Yet concomitantly we have just voted to reduce the towns tourist generated annual cash flow by at least $25-40M and hurt many locals in their pockets. And the state is taking a hit also, which will have trickle down financial impact.

A strict ban was not the smart way to vote. Indeed, it was not a smart way for the town to offer to the voters. Instead, we could have taken a page out of the approach taken by Bar Harbor recently where they spent a couple of years gathering data about who the owners of rental properties are, (e.g. local, full time residents, 2nd home-owners, developers), why people wanted or needed to have rental properties (e.g. to be able to afford to stay in their homes, to temporarily support future retirement homes, for pure profit) who was objecting to short term rental’s and why?, what was estimated financial impact to the town of banning vs regulating etc, what the average salary of the local residents is and what can they afford to buy or rent?, what are the current house prices and rental cost? And so on and so forth. Yes, this data gathering phase cost the town some $$ but now they can make informed decisions. And even with all their data it is still a difficult issue to grapple with, but ultimately the town and its inhabitants will benefit through a balanced set of regulations. Will everyone be happy – of course not but decisions will have been made in a data driven fashion. Conway could have done likewise.

Conway has just opened Pandora’s box!

The vote against short term renting in residential area’s is, in my opinion, short sighted and likely voted on emotionally, not logically, by most. And as a previous comment stated it was likely brought to a head because of a few bad apple properties. Please read that previous comments above. He/she makes a slew of good points about the financial impact to the town, so I won’t repeat those here.

Many towns have struggled with this topic in recent years. Here are some solutions other towns have introduced when tackling this multi-faceted issue. San Francisco instigated a law that only full term residents can list their properties on the various rental sites – thereby helping their own residents support themselves and actually stay in their homes, while diminishing out-of-town multi property owners. Bar Harbor, ME, requires all properties to be registered and a license paid to the town, and has a ceiling on the number of short term rental properties in town. Bar Harbor recognized the need of many locals to supplement their income to stay in their homes, and also the value of tourism to the town. The City of Los Angeles limits property owners to120 days per year to host clients, again recognizing tourism as important. There are many other thoughtful and balanced regulations

At the state level, Arizona, Florida, Idaho, Indiana, Tennessee and Wisconsin have all enacted legislation prohibiting short-term rental bans. And New Hampshire state has a bill, currently tabled, to prevent municipalities from banning short term rentals. This bill could open back up for discussion as it was tabled during covid.

Sadly, I anticipate a slew of law-suits to be forthcoming for the town of Conway and maybe even a class action suit from a collective of short term rental property owners. And the short term rental companies may join the lawsuits as they have in other cities.

Contrary to a simplistic ban, many local governments have mitigated the challenges brought by short term rental, through proper and fair regulations. The “battle” may have been won in Conway, but the war is just starting.

This is incredibly short sighted of members of the town. If the average visiting family from out of town spends $500 in meals and leisure, and every weekend through the year is booked at 500 rentals, that alone is $13M of lost income to the small businesses in North Conway. We own 2 small rentals in town catered to families. We have paid out, in less than 2 years, over $150K in cleaning fees to a local property manager.

These numbers are real. I highly recommend the town model anticipated loss of income as a result of this vote. Finally, we've gotten numerous offers on the properties we own, for way more than appraised values. I do not believe this move will loosen the housing market.

@Reporter - please feel free to email me for more information.

This is a very interesting decision given the likelihood that a just few bad apples may be spoiling the batch for short term rentals in Conway. The potential shut down of short term rentals likely triggers significant adverse impacts on the local economy: fewer people employed due to no cleaning and less lawn and home maintenance, less rental taxes to the state and local governments, presumed decline in property values across the board due to a potential glut of inventory on the market and fewer people interested in owning in the town if the short term rental option is removed, and not to mention the thousands of people that stay in the area each weekend at short term rentals that eat in the restaurants, shop in the local stores, etc. The pandemic has increased people’s desire to stay in isolated short term rentals relative to higher density hotels. Surely those people will just find an alternate location to vacation. I would assume enforcement of any shut down of short term rentals will cripple the town for years to come.