Downtown Asheville Airbnbs, tourist rentals face proposed limits

ASHEVILLE - In one of the country's most popular tourist zones, city officials are moving to stem the growth of short-term vacation rentals, which can fetch up to $900 a night through online services such as Airbnb, and that critics say exacerbate a serious housing shortage.

City Council members of a key committee have proposed barring short-term rentals or "STRs" in downtown unless owners get special zoning permission from the council.

At the direction of the committee, city staff have drafted a proposal for new restrictions for review Wednesday by the planning and zoning commission, the main advisory body for such rules. The commission is expected to make a recommendation at the public meeting, which starts at 5 p.m. at City Hall. The council is slated to make a final decision on the proposal Jan. 9.

Members of the council's three-member planning and economic development commission say downtown, one of the diminishing number of places in Asheville without STR restrictions, should have the same rules as most other parts of the city. In those places it's illegal to rent dwelling units for less than 30 days and violators face $500 daily fines.

Councilwoman Julie Mayfield chairs the commission and pointed to a December city study which said there was "exponential" growth in the number of housing units being turned into STRs downtown, rising from seven in 2015 to 44 in 2017.

"We have a crisis for permanent long-term housing for people, really both for rental and ownership," Mayfield said.

Downtown properties that have already been converted to STRs would continue to be legal, said Mayfield.

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Newly elected councilman and committee member Vijay Kapoor campaigned on loosening the STR ban on backyard cottages, garage apartments and other accessory dwelling units so property owners would "be able to tap into" Asheville's booming tourist economy.

Kapoor said his idea of an accessory dwelling unit pilot program wouldn't be affected by a downtown ban. He said he was less moved by the study and that his main interest was seeing more uniform city rules.

"When it comes to whole-house short-term rentals, to me, I don’t think downtown should be treated differently," he said.

Whole-house and ADU vacation rentals have long been banned in residentially zoned areas, but an uptick in the practice led the council in 2015 to increase enforcement and jack up fines from $100 to $500 a day.

After some residents said the rentals were a way to make ends meet in an area with a lack of good-paying jobs, the council made it easier to run homestays.

Those are rentals gotten through a paid city permit where a guest can stay in part of a house for less than 30 days as long as the owner or long-term resident is present. The renter can't have a separate dwelling unit with amenities such as a kitchen.

In 2017 the council voted to extend STR restriictions to the River Arts District and along West Asheville's popular Haywood Road.

In downtown where the rentals remained relatively unhindered developers began to make them part of planned residential projects. An 18-unit development at 88 Southside Ave. now plans to use 10 of the units as STRs, according to the study by city planning and urban design staff.

On Church Street, owners of the Altamont Theatre announced last year they would close the performance space to build STRs.

A study by Airbnb showed in 2016 STRs in the Asheville area raked in more than $13 million, an amount higher than Charlotte, Raleigh and four other of the state's biggest cities municipal areas combined.