Short-term rental costs near the UT campus could rise as the Austin City Council took its first step on Feb. 4 toward implementing stricter regulations on renting platforms like Airbnb and Vrbo.
The council convened to hear comments from the Austin Development Services Department, which unveiled a plan to reform Austin’s short-term rental market. These rentals, which are properties rented out for 30 days or less, have been difficult for officials to regulate.
The city has limited insight into how many unlicensed short-term rentals operate in Austin, said Stephanie Sanchez, a Development Services Department public information specialist.
“(Development Services Department) Code Compliance does not have an estimated number of unlicensed (short-term rentals),” Sanchez said in an email. “This data is compiled by third parties, which lead us to believe that the majority of (short-term rentals) in Austin are unlicensed.”
City data shows that just 25 licensed short-term rental properties are in the West Campus zip code, while Airbnb lists around 150 in the neighborhood.
The new rules would also require rental platforms like Airbnb and Vrbo to include rental license numbers in their listings, preventing websites from listing properties without including the license numbers, said Daniel Word, assistant director of the Development Services Department.
The lack of proper licensing allows property owners to avoid collecting hotel occupancy tax. Austin visitors pay 17% in hotel occupancy tax, with the state collecting 6% and the remainder going to the city to fund tourism-related expenses. Austin visitors will now pay the entire 17% tax regardless of whether they stay in a hotel or short-term rental.
Word said the platforms would have to now add the tax as a cost and send it directly to the city, instead of leaving the responsibility to property owners.
The City Council and Planning Commission heard from Austin residents about the reforms to short-term rental properties. Property owner Roland Robinson said the new regulations would make it easier for large corporate hotels to push out local “mom and pop” property owners.
“I never thought I’d see the day when people starve on the streets, and our representatives here are trying to take my job and take our jobs away,” Robinson said. “This is a job for me. I earn an income from this. This would put me out of business.”
UT parent Mark Owens said he often uses these platforms when he visits his daughter at UT. He said booking an Airbnb tends to be less expensive than hotels near the University because of the high price of Austin parking, and the platforms he uses tend to be more upfront with their costs.
“In hotels, there are often a few fees that you don’t anticipate when you see what this price is,” Owens said.
Owens also said while he understands why the city would want to enforce this tax on owners with multiple properties, there are Airbnbs he’s stayed at where a hotel occupancy tax doesn’t fit.
“The last place I stayed in Austin, it was just a single lady that just needed some extra income for the maintenance of the house and just her livelihood,” Owens said. “In that situation, it seems like requiring a tax more generally oriented towards businesses doesn’t seem quite right to me.”
