The Stanton City Council last month voted for an ordinance that bans short-term rentals such as Airbnb and bed and breakfasts in residential and some other areas, adding it to a growing list of Orange County cities that have embraced this erosion of property rights.
Santa Ana also recently voted to reaffirm its ban in the wake of a lawsuit challenging its previous ban. According to a VoiceofOC analysis, other OC cities with bans include Costa Mesa, Fountain Valley, Garden Grove and Irvine, while Fullerton, Newport Beach and Orange impose caps on the number of rental units. Anaheim reversed course on the issue.
Cities use various rationales for limiting these market-based alternatives to hotels. The main one, as explained by the Stanton staff report, involves “complaints related to illegal parking, noise, and other nuisance activity that negatively impact the quality of life for surrounding residents.”
Homeowners and long-term renters also can create nuisances. Cities should focus on combatting bad behavior by enforcing current codes – not by imposing broad bans. Most short-term rentals operate without a problem and provide benefits also, such as increasing tourist activity. Stanton isn’t known as a tourist city, so it might benefit from the added visitors and tax revenue.
The next main critique involves short-term rentals’ supposed impact on rents and housing prices. Santa Ana’s staff report explains that short-term rentals divert “a significant portion of available housing away from permanent residents.” Studies show that short-term rentals slightly bump up prices, but it’s unlikely banning them will result in a large increase of supply.
Many short-term rentals involve extra rooms in people’s homes. In cities such as Santa Ana that impose strict rent controls, many property owners are leery about renting out their properties on a long-term basis. Instead of punishing property owners, the city ought to eliminate rent controls (which significantly drive up prices over time) and permit more housing construction.
Airbnb and similar platforms are handy scapegoats for problems that are mostly of these cities’ own making, but these bans will not provide the promised solutions.
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