Crown Point neighborhood signsUsing Airbnb and similar web-based short-term rental services that enable homeowners to rent out their homes has become popular with budget-conscious travelers.  However, a growing number of municipalities believe that such transient rentals threaten the residential character and quality of life in the neighborhoods in which they occur and have adopted laws to regulate short-term rentals in their communities.

For instance, in August 2015, the Town of Southold adopted a local law banning “transient rental properties,” which are defined as dwellings that are rented out for a period of less than 14 nights at a time.  Under the law, rentals are presumed illegal if they are advertised on websites such as Airbnb, HomeAway and VBRO.  This presumption can be rebutted by presenting evidence to the Town’s Code Enforcement Officer demonstrating that the residence is not a transient rental property.  Violators face fines from $1,500 to $8,000 for a first offense, and from $3,000 to $15,000 for conviction of a second or subsequent offense within 18 months.

Proponents of Southold’s law claimed that homeowners who were offering their homes for short-term rental were essentially operating commercial businesses in residential neighborhoods that created quality of life issues for other residents.  Some residents also claimed these short-term rentals enjoyed a competitive advantage over local hotels and bed-and-breakfasts, which are subject to regulations that short-term rentals are not.  Opponents of the law argued that the Town Board failed to recognize the importance of short-term rentals, not only to North Fork homeowners who rely on the additional income, but also to the area’s tourism industry, which they claim suffers from a lack of traditional lodging.

In the first challenges to the law, an attorney representing a number of homeowners who had been advertising their homes for short-term rentals is claiming that his clients’ actions are “grandfathered” under the Town Code’s provisions which deal with “non-conforming uses” – uses that legally existed prior to the passage of the new legislation.  On March 25, 2016, two applications were filed with the Town’s zoning board of appeals seeking relief from the law.

While all sides will be monitoring these challenges closely, it is unlikely that the law’s validity will be decided at the zoning board of appeals level because the board’s decisions are likely to be challenged in a court of law.

Stay tuned, because as this year’s summer vacation season rapidly approaches, this East End hot-button topic will undoubtedly get hotter.