Allowing more Ashland residents to rent their homes to tourists for short-term stays could boost the local economy and city lodging tax revenue, but it could also hurt neighborhoods, drive up home prices and lead to a shortage of regular rental housing, according to a city staff report on the largely under-the-radar vacation rental housing industry in town.

Allowing more Ashland residents to rent their homes to tourists for short-term stays could boost the local economy and city lodging tax revenue, but it could also hurt neighborhoods, drive up home prices and lead to a shortage of regular rental housing, according to a city staff report on the largely under-the-radar vacation rental housing industry in town.

With so many pros and cons to weigh, the City Council decided on Monday night to have the Planning Commission investigate the issue and recommend whether vacation rental housing laws should be loosened.

Under current rules, people can rent their homes to tourists for short stays — fewer than 30 days — if their homes are in business or multifamily zones with access to parking and major streets.

Property owners in those zones must go through a land-use process and win approval for renting their homes to tourists, but many don't.

People in single-family housing zones cannot rent their homes for short-term stays, although many are doing so illegally.

In May, the city sent out letters to about 40 property owners in multi- and single-family zones who are renting their homes to tourists illegally. Staff members caught most of the illegal operators by checking popular websites that advertise vacation home rentals.

No one knows for sure how many homes are being used illegally in town, but estimates range from at least 50 to more than 150.

Councilors expressed mixed views about easing restrictions during a Monday night study session, although they agreed the Planning Commission should investigate and gather public input.

Councilor David Chapman said vacation rental housing provides a unique and valued lodging option for tourists and a well-maintained home benefits a neighborhood's appearance.

Councilors Carol Voisin and Mike Morris said they were concerned that loosening laws could impact the availability of regular rental housing.

The staff report on vacation rentals said that homeowners can often earn more money renting their homes out to tourists than they can from operating traditional rentals. As more homeowners turn to vacation rentals, housing prices can go up and the availability of traditional rentals can go down.

Several councilors and Mayor John Stromberg said they were worried about impacts on neighborhoods.

Councilors Dennis Slattery and Greg Lemhouse said if Ashland does loosen vacation rental laws, it should work to level the playing field for bed and breakfast inns.

Inn owners have said illegal vacation rental owners have an unfair advantage because they are not collecting lodging taxes from visitors, haven't won land-use approval, don't have business licenses or liability insurance, and don't have to undergo health and safety inspections.

In a position paper on unlicensed vacation home rentals, Ashland's Bed & Breakfast Network said its members want those issues addressed so they can compete on a level playing field with the owners of rental vacation homes.

— Vickie Aldous

Read more in Wednesday's Daily Tidings