With a recent ban on short-term home rentals in residential neighborhoods, Newport has joined the wave of tourist destinations attempting to strike a balance between accommodations for tourists and residents.
The ban, passed last month by the Newport City Council, prohibits rentals of less than 30 days of homes that are not occupied by the owner in residential neighborhoods. The ban also prohibits short-term rentals in the city’s “limited business zones,” unless owners obtain a special permit.
Property owners outside of these designated neighborhoods, and those renting units in their owner-occupied, primary dwelling, are unaffected.
The growing popularity of short-term rental platforms online have prompted communities around the country and the world to reevaluate their regulations for these rentals, said Evan Smith, CEO and president of Discover Newport.
“A decade ago, it was very obscure,” Smith said. “Today, short-term rentals are one of the fastest-growing trends in travel.”
A decade ago, short-term rental units made up less than 5% of the market share in Newport and Aquidneck Island, Smith said. Now the percentage is 25% to 30%, or about 1 in 4 rentals.
The trend comes with its benefits and challenges, Smith said. Short-term rentals offer visitors a wider diversity of lodging types and price ranges, and provide additional rooms needed during peak times of the year. The rentals also provide another income source for property owners.
But the rentals can be the source of noise and parking disruptions. They can also muddle transparency in tax reporting and have created what hotels say is an uneven playing field in terms of safety regulations.
Sarah Bratko, senior vice president of advocacy/general counsel at the Rhode Island Hospitality Association, said the ban on short-term rentals in residential neighborhoods will help to address hotels’ concerns.
“These [rental properties] are operating as hotels, but they’re operating free of all the rules that hotels and bed-and-breakfasts have to follow,” Bratko said. “So for us, it is a major equity issue. If you’re operating as a business, you should be operating as a business.”
The ban will also open would-be short-term rentals for longer-term housing, Bratko said, allowing more workers to live in pricy Newport.
Currently, landlords using their homes for short-term rentals has “a real, devastating impact” on people trying to live in Newport, she said.
While tourists are “an incredibly important part of the economy,” Bratko said, “we also have to make sure we’re supporting the people who live in those communities.”
Erin Donovan-Boyle, executive director of the Greater Newport Chamber of Commerce, said she sympathizes with property owners who use short-term rentals as an income source but expects the regulations “will probably have a net-positive outcome for the region” in the long term due to housing implications.
Donovan-Boyle is also confident that the city can accommodate tourists without additional units in residential neighborhoods.
“This new sort of trend for short-term, Airbnb-type options is certainly something that is attractive to a traveler,” Donovan-Boyle said, but “our official businesses and hoteliers have more than enough availability to offer.”
Going beyond noise complaints, the regulations also reflect a “desire to reclaim Newport’s neighborhoods” for longer-term residents, said Thomas Shevlin, communications officer for Newport.
Jacquelyn Voghel is a PBN staff writer. Contact her at Voghel@PBN.com.