Carbondale town trustees are leaning toward looser short-term rental regulations.
At Tuesday’s work session, the board discussed how they could refine a regulation the town implemented in 2022 requiring property owners who want to rent their homes for less than 30 days at a time to file for a short-term rental license. It also limits which properties are eligible for licenses.
Housing units in Carbondale’s “Historic Commercial Core Zone” downtown are eligible; so are any properties that qualify as a homeowner’s primary residence. Some property owners who do not qualify under these categories but rented on a short-term basis before 2022 can also acquire a license.
Part of the town’s motivation when passing the regulation was to prevent investors from buying multiple properties in town and renting them out for a few days at a time.
According to Town Manager Lauren Gister, the fear was that these owners would remove Carbondale’s existing housing stock from the long-term rental market, making it more difficult for the local workforce to find housing options.
“We found that was not, in fact, what we had in town,” Gister said. “There were a couple of investor-owned properties, but for the most part, these are regular people trying to rent out either a portion of their home or their entire home when they are not here. And there were a few that were second homes.”
In June of 2023, 71 Carbondale homeowners had active short-term rental licenses. As of Tuesday, the town only had 35.
The town isn’t sure if homeowners lapsed in renewing their licenses and still operate STRs, but licenses aren’t transferable. Therefore, today’s vacation homebuyers outside of Carbondale’s historic district won’t be able to rent their properties on a short-term basis, even if the previous homeowners could.
In Tuesday’s work session, Town Trustee Jessica Robison said that many properties currently ineligible for licenses are large homes that would rent for $6,000-$7,000 a month, and these homes aren’t viable options for most of Carbondale’s workforce.
“I don't think that we're going to solve the affordable housing crisis by restricting short-term rentals,” Robison said. “I know that was a big concern in 2022 when people came in and said ‘This is eating up long-term, workforce housing rentals.’ I think that we're seeing that's not really the case.”
Carbondale voters passed a short-term rental tax in 2022, and the town has collected nearly $300,000 as of May 2024 for affordable housing projects.
Proponents of reforming Carbondale’s short-term rental regulation argued that the town is missing out on tax revenue as a result of current restrictions.
Brittany Hailey manages short-term rentals in the Roaring Fork Valley. She told town trustees Tuesday that a lot of her customers want to stay in Carbondale, but there aren’t enough desirable locations. As a result, she occasionally offers them her personal home.
“I've moved out of my private home because they're like, ‘We need to stay in Carbondale. There's nowhere to go,’” Hailey said. “So I just moved somewhere else with my kids.”
She also told trustees that Carbondale’s short-term rental regulation has not had an effect on home prices or rental prices, since she regularly monitors the rental market, but Town Trustee Chris Hassig pushed back on that assertion.
“I don't know if we can prove a negative in terms of the home prices or the rental prices,” Hassig said. “We don't know. The point of the regulation originally was prophylactic. It wasn't supposed to be killing an existing crisis. It was supposed to be heading off an impending crisis.”
He added that there may be some worthwhile adjustments to the existing regulation, but he hopes the board will forge ahead carefully.
“I think we all agree that we don't want to tighten anything any further, but I think we want to be careful about how we loosen it up,” Hassig said.
Trustees were generally supportive of loosening restrictions. Whether that includes permitting second homeowners to rent on a short-term basis or making the licensing process simpler is still to be determined.
Town staff will find future agenda time for trustees to continue to discuss the issue.
