When Bethany Field bought a multi-unit building on Hampshire Street in 2009, she inherited a tenant who didn’t pay the rent and smoked cigarettes inside the apartment.
She finally got rid of the problem tenant just as Airbnb was growing in popularity. So she opted not to find a tenant for another yearlong lease and decided to try out renting the apartment through the short-term online rental service instead.
“It’s been fantastic,” said Field, a marketing professional who believes she had one of Portland’s first listings on the site.
Now there are more than 250 rooms, apartments and entire houses in the city advertised on Airbnb and other short-term rental sites, almost all of them on the peninsula, with the highest concentrations in the West End and on Munjoy Hill. From a room to crash in to an apartment off St. John Street to a townhouse in the West End, current prices range from about $50 to $250 a night.
As the service grows in popularity, so do concerns about the safety of guests staying in the unregulated rooms, whether the service is fair to hotels and inns that are required to be licensed and inspected, and the impact on Portland’s already shrinking housing market. While not all of Portland’s Airbnb listings are former year-round apartment rentals, the opportunity for property owners to significantly boost rental incomes has clearly siphoned some apartments from the housing market.
Short-term rental hosts argue against more regulations, saying they wouldn’t be able to afford to upgrade the units to hotel standards. And, they say, the money they make from renting to tourists and short-term visitors is vital to their livelihood.
The regulation of short-term rentals – part of the increasingly popular yet controversial shared-economy, along with services like taxi alternative Uber – is a conversation happening all over the world, and now Portland.
The City Council’s Housing and Community Development Committee took up the issue at a meeting last month and will continue the discussion Wednesday. Potential regulations posited by city staff include requiring registration with the city, limiting the number of days a unit can be rented and only allowing hosts to rent their primary residence.
Even if some regulations are adopted, Field might not be affected.
She only rents out her fully furnished, one-bedroom apartment during the summer, then leases it to a single tenant for the other nine months of the year.
Still, she’s concerned about the effect eliminating short-term rentals could have.
“It’s sort of limiting how one could experience Portland, which would be kind of a bummer,” she said, noting that her guests prefer staying in homes to hotels.
She and her husband, Chris Korzen, who also has an apartment he owns on Grant Street that he lists on Airbnb, said they believe there are better ways to address the city’s housing crunch, such as pushing forward with a long-delayed housing project in Bayside that would add hundreds of units to the city.
Commercial real estate broker Joe Malone sees it differently. Although he doesn’t believe banning short-term rentals would solve the city’s housing problem, he said it’s “low-hanging fruit” for getting more apartments onto the market.
He said he knows landlords who have stopped leasing apartments because they make more money on Airbnb and renters who’ve been kicked out of their apartments for the same reason – including his yoga teacher, who had to move to Falmouth.
“We have to have places for people who work in Portland to live,” he said.
HOTELS LOBBY FOR RENTAL RULES
Renters aren’t the only ones affected by the growth of short-term rentals.
Greg Dugal, executive director of the Maine Innkeepers Association, said there’s been a notable increase in the number of people who are choosing Airbnb rentals for stays of more than a couple of days.
Because they don’t have to comply with state regulations, he said, those property owners can charge much less than licensed lodgings. The association has supported bills in front of the Legislature that would have required short-term rentals to meet the same standards.
As for Portland, Dugal said, he would support a ban on short-term rentals, but doesn’t believe it’s politically feasible and thinks at least some regulations, such as the ones being discussed, would be a reasonable compromise.
“Regardless, there needs to be some form of oversight or there should be a ban based on National Life Safety Code violations alone,” he said.
Some Maine cities and towns have already taken action toward regulating short-term rentals.
Before Airbnb became popular, Cape Elizabeth began requiring permits in 2012 for rentals of fewer than 30 days, after the town received complaints about loud parties and cars parked along the streets as a result of short-term rentals.
Bar Harbor requires vacation homes rented for between five and 30 days to register with the town, get an inspection and pay a one-time $50 fee.
The Rockland City Council is taking up a proposal Wednesday that would require annual permits for short-term rentals, along with insurance, on-site parking and, for multifamily homes, an inspection.
Nationally, other cities are cracking down on short-term rentals as well. The city of Santa Monica, California, adopted regulations in June requiring short-term rentals to have a business license, pay a 14 percent occupancy tax and require hosts to live on the property while it’s being rented. In November, voters in San Francisco, the birthplace of Airbnb, will decide whether to limit short-term rentals to 75 days a year.
THE PERSONAL TOUCH
There’s no way to tell how many of the online listings in Portland are homes that are being rented out when residents leave, spare bedrooms no longer occupied by grown children or furnished apartments that would otherwise be rented to year-round Portland residents.
Some property owners who did take apartments off the year-round rental market report that while Airbnb is more lucrative than renting long-term, it’s also a lot of work to clean the apartments and wash linens between renters, as well as add the personal touches that garner good reviews and move more people to choose their place.
But owners also say they enjoy meeting new people from around the world and introducing them to Portland, providing a more personal perspective on the city than a concierge at a hotel would in recommending restaurants and worthwhile sights.
Korzen said he has even taken guests sailing with him.
Gary Wagner provides champagne and fresh strawberries for short-term guests who pay to stay in half of his two-family home on Brackett Street in the West End.
Days after he listed the newly renovated space on Airbnb in July for $199 a night, it was 90 percent booked for the next two months, with guests coming to town for everything from weddings to concerts to business conferences. He ended up booking the space every day in August, September and October, charging as much as $499 a night on the weekend of the Beach to Beacon.
“There’s a clear demand,” said Wagner, a Westbrook fire lieutenant who was inspired to try it out after seeing the success of his neighbors.
One of them, Ralph Baldwin, a retired English teacher, doesn’t even own the four West End apartments he lists on Airbnb. He rents them from the building owners. Although the rental income has not yet offset the upfront costs of furnishing the apartments, which he started listing in March, Baldwin expects to be in the black by the winter.
“It is strenuous, especially if you have a lot of laundry one day or three houses to clean,” said Baldwin, who hasn’t figured out what he’s making per hour.
“I’m anticipating this will enhance my bottom line,” which he said was hurt by the recent recession and the state cut to teacher retirement.
As to whether it’s helping to drive up city rents by taking apartments out of an already tight market, Baldwin said, two of his units hadn’t been rented out for years.
Plus, he believes the money his guests spend in the city more than makes up for it.
“I think one of the remarkable things about Airbnb is that it brings people into the city that might not come here,” he said, whether it’s because an Airbnb rental is more affordable than a hotel or more suitable to the guests to have an apartment where they “have space to gather instead of everyone sitting on the edge of a bed.”
Field said that in her five years of hosting guests through Airbnb, she knows at least five of them decided to move to Portland afterward.
Wagner thinks such good will has a lot to do with the depth of knowledge and personal touch that the hosts can offer.
On Thursday, Wagner cleaned up after the departure of a group of men from Germany who had come for the area’s restaurants, and stocked the fridge with local craft beers and cookies from Standard Baking for a couple from Texas arriving that night for their honeymoon.
“We’re selling Portland,” he said.