Don’t limit short-term rentals in Denver

Colorado tourism hit new heights in 2014, driven by Denver, which overtook ski-resorts for the first time as the top destination for travel in the state. Unfortunately, the Denver City Council is considering legislation that will restrict the burgeoning short-term rental (STR) market, potentially putting the Mile High City out of reach for travelers.

The pending legislation legalizes primary residency short-term rentals exclusively and bans non-primary residency rentals.

Originally, the City Council had rightly wanted to craft a policy that legally acknowledged the short-term rental market and ensured maximum compliance. Yet the pending policy does the opposite. As currently written, the primary residency restriction will drive some short-term rentals underground. This will negatively impact compliance while discriminating against secondary-property owners.

Worse, this policy is based not in data, but misleading anecdotes about party houses and higher housing prices. A recent study, however, sets the record straight. A trio of professors from the University of Denver used a survey of 408 VRBO renters to identify the economic benefits of STRs in the Denver area. Their conclusions show that STR renters alone help drive approximately $21.3 million in additional spending during their visits to Denver each year. This figure does not include $13.6 million in STR rent, which goes into the pockets of Denver families.

While many discuss the negative impact of STRs on housing stock, recent data estimate that the quantity of active vacation rentals in Denver is less than 1 percent of residential homes in the city, or roughly 1,500 homes.

Moreover, since last May, the number of STR complaints due to neighbor disturbances is just six, according to city data. In other words, despite accounts to the contrary, STRs are not causing neighborhood concerns at any appreciable level. Furthermore, restricting STRs to primary residences would not preempt potential wrongdoings. In fact, industry data confirm that secondary property owners often provide greater guest scrutiny and oversight to ensure the security of their investment.

We aren’t asking for the City Council to eliminate all regulations for our budding industry. On the contrary, we favor licensing, taxation and safety measures as clear, reasonable regulatory framework components that owners and renters alike can easily comply with, so long as these regulations don’t infringe upon homeowner property rights. But writing policies that penalize homeowners who contribute to the economic growth in Denver is not consistent with the probusiness climate Denver has worked diligently to foster.

We hope City Council members will recognize the economic realities and benefits that the nascent short-term rental industry has to offer.