The last decade has seen a meteoric rise in the number of vacation rentals in the Sonoma Valley, but that comes at a cost: annoyance from neighbors and, according to academic studies, higher rents locally.
More than 600 residences in the Sonoma Valley have been licensed to operate as short-term rentals over the past 10 years, according to data from Permit Sonoma. The surge in vacation rentals countywide led the Sonoma County Board of Supervisors to issue a moratorium on new vacation rentals on May 10 to stem the flow of new inquiries.
“While vacation rentals play an important role in Sonoma County’s tourism economy, they also have the potential to cause adverse effects and pose a risk to public safety, health and welfare of the county. and its inhabitants,” said a press release announcing the moratorium. .
In addition to the nuisances created by short-term renters — such as excessive noise and a scarcity of parking spaces — a Sonoma County report released in December 2021 found that while findings about the effects of vacation rentals on the market housing prices are “mixed”, these studies “lean towards the conclusion that rental prices are more likely than the prices of houses for sale by increasing volumes of short-term rentals”.
One of the most controversial areas regarding vacation rentals is Theodor Lane in Boyes Hot Springs, where at least nine vacation rentals operate within two short blocks, according to county data. Liza Graves, president of property management company BeautifulPlaces, has been following the public debate about Theodor Lane at meetings of the County Board of Supervisors and Planning Commission.
“The main complaints are that there are a lot of vacation rentals in this particular area, a lot of complaints about noise, overcrowding, parking and neighborhood disturbances,” Graves said.
Graves grew up on the East Coast where his family stayed in vacation rentals in the 1950s and 1960s. But the impacts of vacation rentals along Theodor Lane “painted the whole industry in a bad light”, which which she attributes to a lack of oversight from business owners.
In response to ongoing issues with Theodor Lane vacation rentals, Graves and Madeleine Yankee, owner of property management company Woodfield Properties, have written an open letter to owners of Theodor Lane vacation rentals outlining how they can lessen their impact. negative about the neighborhood.
They advised owners to limit overnight capacity and ban daytime guests, increase the minimum stay to between five and seven nights in high season and install a sound meter on the house. At the county, they urged officials to apply tougher penalties for violations.
“You have to manage not only the customer experience, but also the impact and experience on neighbors,” Graves said. “There are a few bad actors – whether they don’t care or are motivated by money – it hurts everyone.”
Even more than neighbors, vacation rentals hurt renters, some research finds.
A study published in the Journal of Urban Economics points to two effects that may increase rental housing costs in areas surrounding vacation rentals.
The “efficient use effect” uses residential properties and maximizes their profits by establishing vacation rentals, which stimulates housing demand and leads to higher housing costs. The “rental housing supply effect”, meanwhile, reallocates “the existing housing stock from the long-term rental market towards private housing, which increases rents”.
By converting what would otherwise be a long-term rental unit into a vacation rental, owners often see a significant return on investment. In the Sonoma zip code, the average daily rate for an Airbnb is more than $600 per day according to AirDNA, a vacation rental search tool.
But the study is split for some of the same reasons Graves worries about vacation rental customers. The consequences of irritating guests in a neighborhood can negatively impact property values, the study suggests.
The holiday rental moratorium – originally set at 45 days – was extended for up to a year by the Board of Supervisors on June 13 as the county struggles to balance the interests of holiday rental owners and residents who may face the negative consequences of vacation rentals.
Graves, meanwhile, is working on a set of recommendations to formally propose to the county to improve vacation rental regulations in the future.
“We care deeply about the community,” Graves said. “We believe it is the responsibility of all vacation rental owners to respond to neighbors and make any necessary adjustments.”