Short-Term Rentals Could Take Everett by Storm as Boston Pushes Them Out

June 28, 2018
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As Boston and Cambridge enact tough ordinances to push out investor-owned short-term rentals (Airbnb) from their cities – and with the Encore Boston Harbor casino opening in one year – there is some pause in the City that Everett might need to protect its housing stock from being overrun by what is becoming known as “vertical hotels” – or short-term rentals that occupy all three units of a triple decker and displace residents from typical apartments.

This week, Mayor Carlo DeMaria said he has instructed his staff to review the regulations that have been enacted and are being considered around the region. He said now is the time to begin thinking about protecting the existing housing stock from what could be a bad situation, while also permitting the short-term rental market to flourish under responsible hosts.

Two weeks ago, Boston enacted an ordinance to regulate short-term rentals, and in doing so, banned investor-owned short-term rentals from their city. That meant that only owner-occupants could rent out their units for services like Airbnb. While Everett does have some short-term rental operators now, it isn’t overrun with them, but with the proximity to downtown Boston – and the investor industry now barred from Boston – Everett could become prime territory in the coming months.

City officials said this week that they are looking at the new Boston ordinance and other ordinances to see what they could do to regulate the industry – especially ahead of the casino opening.

The trick will be to balance keeping the housing stock preserved for residents, and also allowing responsible short-term rental operators to utilize their home for extra income when they aren’t using it.

“As home values continue to grow, Airbnb can be both good and bad,” said Mayor Carlo DeMaria this week. “It allows our older, long-term residents to stay in their homes with supplemental income. However, short-term rentals also attract outside investors who drive up the cost of housing by buying multiple properties and can ruin the character of our neighborhoods.

With the new Boston regulations, I am greatly concerned these rules will drive even more outside investors into Everett. Because of our close proximity to Boston I have ask my staff to review these regulations and come up with a plan to mitigate any issues.”

City Councilor Michael McLaughlin – who represents the area closes to Encore – said he plans to file an order at the August Council meeting asking that the City begin to study the issue before it’s too late.

“I do plan on filing something for our next meeting,” he said. “We definitely need to preserve our housing stock and prevent Everett residents from being displaced.”

All in all, though, the issue hasn’t been on the front burner in places like Everett and Chelsea, but has just now erupted due to the reality that investors might target Everett and Chelsea as the next big operating market.

One of the greatest worries for affordable housing developers is that existing affordable units will be gobbled up for short-term rentals, which can often be more profitable than renting a traditional apartment.

The Neighborhood Developers (TND) – which develops affordable housing in Everett and Chelsea – said the demand for their units has increased significantly, and any added pressures would only compound the situation.

“The Neighborhood Developers has yet to take a position on short-term rentals,” said Aaron Wasserman of TND. “We know that displacement pressures have increased since the 2008 recession in Chelsea and neighboring communities. TND is nearing completion of Acadia, 34 affordable apartments for families in Chelsea. We’ve received about 2,000 rental applications for these 34 homes, and applications are available through mid-July. Any stressor on the housing market that takes much-needed units off-line will further squeeze households.”

The Metropolitan Area Planning Council (MAPC) said they are monitoring the situation too, and advocating for state legislation.

Diego Huezo said they are pushing for three things in any state bill – the first being that municipal/local regulations should supersede state regulations. He said what might be good for Everett might not be good for Cape Cod towns.

However, he said one of the key elements will be to pass a bill that requires rigorous data collection so that any problem or potential problem can be diagnosed.

“It’s hard to understand all the units in Boston, Cambridge, Everett and surrounding cities and towns,” he said. “It’s hard to find the units if we don’t know where they are and what the unit is. We don’t know how much they charge and how many nights people are staying. We can’t find the impacts without having that kind of information. If we don’t get data this time around, we won’t be able to determine what is happening in the communities.”

He said there is a lot of anecdotal evidence that has come up in state hearings regarding triple-deckers being purchased by a short-term rental company, all the tenants evicted, and then each of the units being used like a hotel. That said, he indicated collecting information can put numbers on those stories.

The final state piece will be how to tax short-term rentals, and Huezo said that seems to be a sticking point right now in a Conference Committee at the State House. A short-term rental bill is in that Committee and has been since April, he said.

In Everett, a few Airbnb hosts pop up as very popular, including one Arlington man named Raman (Ray) who rents out an entire home for a short-term rental. He would not consent to an interview with the Independent, but the home is in the Lower Broadway area and goes for about $268 a night. It supports eight guests and has three bedrooms, four beds, and two baths.