Taking a closer look at the rental problem



There are two competing interests here on the coast of Maine when it comes to short-term rentals. Landlords can earn more by renting out properties by the night or the week than by leasing them long-term to year-round residents. The practice has displaced residents, put needed housing out of many residents’ reach and, in a number of communities, contributed to a decline in a healthy year-round population and workforce.

You can’t blame property owners for wanting to squeeze as much value as they can out of their investments. That is why regulating such rentals has been a difficult subject to broach even in communities where there is wide consensus that short-term rentals are a problem.

But what exactly does the short-term rental landscape look like statewide? How many units are there? Where are they? Who owns them? Are the properties owned by residents looking to expand their investment portfolios or by out-of-state hedge funds?

These are some of the questions that a recently named 15-member legislative commission has been asked to investigate.

The panel will review data on housing shortages, conversion of apartments and homes to short-term rentals and zoning and land-use rules. It also will consider the possibility of statewide regulation of short-term rentals as well as policies to encourage more affordable housing. The panel includes politicians from both legislative chambers, the head of Maine’s housing authority, a governor’s appointee, and people representing affordable housing interests, municipal governments, homeowners, agriculture, developers and civil rights organizations, according to reporting from the Portland Press Herald.

The panel also will review efforts around Maine and in other states to regulate short-term rentals and restrict land use. Members will discuss strategies to employ land-use changes to make home ownership more affordable and ways to encourage more housing through local incentives and statewide regulation.

A report outlining the findings is expected in November. But then what?

The report will likely find that the rise of non-owner-occupied rentals is affecting the larger rental market and the communities in which they are located. It is creating issues of supply and demand and winners and losers in the housing market. This trends with the discussions taking place in local board meetings.

In Bar Harbor, a town that has been regulating vacation rentals in one way or another since 2006, a change to the town’s charter last year placed a cap on the number of vacation rentals in town. However, the vote to do so was quickly followed by a lawsuit brought by a local real estate agent, which has yet to have its day in court.

The town of Mount Desert is considering a limit to vacation rentals after seeing the impact of neighboring Bar Harbor, say town officials. The popularity of Bar Harbor and Acadia National Park, coupled by the lack of housing in town has pushed would-be buyers to other parts of the island looking for property to buy. Mount Desert Select Board member Martha Dudman may have said it best last year at a board meeting: “If there are homes that are being bought purely as investments, that’s not going to help our island remain a place that we love. It’s being hollowed out.”

Deer Isle, another popular summer destination, also has seen an increase in weekly vacation rentals, prompting the town of Stonington to form a task force to look at the issue more closely. With the recent closure of the Island Nursing Home in Deer Isle, a lack of affordable and workforce housing dominated the discussions surrounding the closure, which was blamed largely on a lack of skilled staff.

While the data from the legislative commission will no doubt shed light on the problem, it is not going to be fixed without a lot of effort from a broad range of stakeholders. And without the creation of more housing — the kind that the average family can afford — the situation is not going to change.

We already have some data to bring to the discussion. We know that the average median household income in Hancock County is just under $60,000. It is hard to compete for a place to lay your head when a one-night stay in Bar Harbor can bring in $400.

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