City council members in St. Paul passed new regulations governing short-term rentals in the city in response to the growing number of private residences listed on platforms such as Airbnb. The move was taken with a view to protecting residential areas ahead of the Super Bowl which will be hosted in Minneapolis in February of 2018. Minneapolis also recently passed new rules regulating short-term rentals.
The legislation passed by St. Paul City Council is lenient in comparison to regulations passed by other cities. While other cities have moved to restrict Airbnb-type rentals to primary residences only, St. Paul’s new rules merely limit the number of apartments within a multi-unit building that can be listed as short-term rentals. The St. Paul rules allow owners of single-family homes, duplexes, and triplexes to lease out one short-term rental unit. Owners of four-, six- and eight-unit buildings may rent out half their units as short-term rentals.
If a building is owner-occupied and the owner is present during the rental, all of the units in a duplex, triplex or fourplex may be leased out as short-term rentals. For larger apartment buildings, four short-term rentals are allowed, or more with a conditional use permit from the city, which would be issued to building owners on a case-by-case basis.
For homesharing hosts, those who are renting out rooms in their primary residence while also living in the property, no license is required. There are also no limits on the number of days a host can rent any type of property (room or entire home). Many cities have passed stricter requirements allowing for only 90 or 180 days per year.
In effect, the city council has decided that investors buying available properties for use as short-term rentals does not pose a problem in St. Paul. They argue that St. Paul does not face the same issues with house price and rental rate inflation as other cities.
Interestingly, the new rules passed by St. Paul have irked Airbnb which is considering legal action against the City. St. Paul’s regulations require booking platforms such as Airbnb purchase an annual “platform” license for a cost of $10,000. The regulations also mandate that Airbnb include the license number of all listed properties within the listing description. It also requires Airbnb to remove all listings without a valid license. Should Airbnb fail to comply, the city can revoke Airbnb’s license to operate in the city.
Airbnb spokesperson, Ben Breit, said: “On behalf of our St. Paul hosts, we are disappointed the city is moving forward with an ordinance that will lead to low compliance and imposes platform requirements in violation of federal law. We will consider all legal options to protect innovation and the privacy of our Twin Cities host community.”
Given that the rules enforced by St. Paul are actually quite lenient in comparison with other cities, one can assume that Airbnb feels that the requirements may set in motion a precedent that other cities will follow. Airbnb, similar to other platforms companies such as Google and Facebook, strongly defends its position as an open platform meaning that they are not responsible for the “actions of its users” which presumably includes licensing enforcement. This may be the area of greatest concern to Airbnb and the reason for them considering legal action against the City of St. Paul.