#BookDirect: Guest Education Day, February 7 — Let your guests know it pays to book direct, book smart, and book local.

In light of recent changes in the regulatory environment, at HomeAway, and across the industry, VRM Intel is hosting an informational and educational event for vacation rental professionals on February 5th at the Perdido Beach Resort in Orange Beach, Alabama.

With 13 sessions between 8:00 am and 5:00 pm, 22 speakers will discuss industry shifts, marketing, profitability and the acquisition environment.

The cost is $129 per attendee. (Note: This event is sold out, but we are meeting with the venue to try to increase capacity. Email amy.hinote@vrmintel.com if you would like to attend but have not yet registered.)

Sessions include:

Vacation Rental Industry Changes and What’s in Store for 2018 with Ben Edwards, Newman Dailey; Lino Maldonado, Wyndham Vacation Rentals; Jason Sprenkle, 360 Blue; Paul Wohlford, Resort Collection
Unfiltered: The Real Cost of Working with OTAs and 3rd Party Channels in Light of Recent Changes at HomeAway and Other Listing Sites
Steve Milo, CEO and founder, VTrips & Vacation Rental Pros
Converting Online Shoppers: Website Design & Usability Tactics with Brandon Sauls, CEO, ICND Using In-house Damage Waiver Programs to Grow the Bottom Line
Balancing Direct and 3rd Party Bookings: How to Leverage Changes at Channels to Grow Direct Bookings with Peter Scott, President, Bluetent
2018 Acquisition Environment on the Gulf Coast with Ben Edwards, VP, Newman Dailey, founder Weatherby Consulting, former president, VRMA
2018 Rental Regulatory Environment with the Baldwin County Association of Realtors and Panel
Building Revenue with In-House Accidental Damage and Bed Bug Remediation Programs with Laird Sager, CEO, Red Sky
Getting the Most out of Property Management Software and New Technology with Doug Macnaught, Managing Partner, VRM Consultants & co-founder, Instant Software
Staffing Challenges: Finding, Training and Retaining your Workforce with Sue Jones, CEO and founder, HR4VR and KLS Group
Communicating with Owners for Inventory Acquisition and Retention: Using Your Internal Data and Performance to Communicate with Owners with Jeremiah Gall, founder Breezeway and co-founder, FlipKey
2018 Industry Partner Updates: Credit Card Processing, Smart Home and Channel Management with Ascent, Lynnbrook, Kaba, PointCentral, Lexicon Travel and RedAwning
2018 Revenue Management Strategies and Comparative Data with Kameron Bain, Director of Operations, Beyond Pricing and Jason Sprenkle, 360 Blue
Profit-Driven Housekeeping and Maintenance with Steve Craig, CEO, Pro Resort Housekeeping and founder, Vacation Rental Housekeeping Professionals

In addition, vacation rental technology companies and service providers are coming to town, including: Xplorie, Red Sky Travel Insurance, Ascent Procession, Beyond Pricing, Bluetent, Breezway, Ciirus, CSA Travel Insurance, Dormakaba, ICND, Lexicon Travel, LiveRez, Lynnbrook, NAVIS, PointCentral, RealTech, RedAwning, Streamline Vacation Rental Software, and Virtual Resort Manager.

Vacation Rental Pros rebrands as VTrips

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January 8, 2018

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Vacation Rental Pros, one of the largest multi-destination, technology-enabled property management companies in the US has rebranded as VTrips. The announcement marks the latest in a series of growth-oriented moves by the fast-growing company.

Founded in 2006, Florida-based VTrips manages 2,000 vacation properties in 19 markets with 150 employees across the United States, including Florida, South Carolina, Tennessee, New Mexico, and Hawaii.

“The new VTrips brand demonstrates our commitment to a national and—soon to be—international brand,” said founder and CEO Steve Milo.”

The company aims to further consolidate its position with scalable technology while aggregating a differentiated supply of exclusive contracts through market-leading operational services and smart acquisitions.

“Our strategy has always been to maintain the local brands of the companies we acquired,” Milo said. “The new brand VTrips serves as the umbrella brand over the original sub-brand, Vacation Rental Pros, along with the 17 other vacation rental brands owned and operated by the company, with further acquisitions in the pipeline.

Milo added, “We also wanted to design a brand that is broad enough to allow us flexibility to expand our platform as we grow.”

By 2021. the global vacation rental market is predicted to be worth $194 billion, and demand for rentals is set to exceed supply by 10 to 20 percent.

According to CMO Amy Africa, “VTrips is changing the traditional paradigm of property-centric marketing in our industry. Because VTrips owns the exclusive contracts to the properties we manage—through our sub-branded micro-sites, the VTrips site and online travel marketplaces—we are able to bring together the exposure provided by the OTA’s along with the services offered by vacation property managers to be fully guest-centric in both our operational and marketing approach.”

Throughout 2018, VTrips plans to continue to scale and further penetrate the vacation rental market through strategic acquisitions, increased focus on brand awareness, and operational efficiencies.

Examining the Traveler’s Decision Process: Who, What, When, Where, Why, How Much?

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January 7, 2018

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I keep six honest serving-men
(They taught me all I knew);
Their names are What and Why and When
And How and Where and Who.

—Rudyard Kipling

In grade school, we learned that who, what, when, where, why, and how need to be answered to fully understand a subject. Our reports, research papers, and essays were evaluated by how effectively we addressed these important questions.

It is not so different in the vacation rental industry. For guests making vacation decisions, finding answers to these core questions is critical in choosing the right lodging alternative.

Who? Who is going to go on the vacation? A couple? Family? Friends? Solo?
What? What type of lodging do I want? A hotel? House? Condo or apartment? B&B? Hostel? Cabin? Shared space? Ship? Tent?
When? When do I want to go? Do I have set dates? Do I have a date range?
Where? Where do I want to go? Do I have a specific location? A region?
Why? Why am I going on vacation? Do I want to sit on a beach? Do I want to ski, fish, golf, tour a city, or go on a road trip?
How much? How much do I want to spend on accommodations? Do I have a set budget?

Every advanced marketer in online traveler is seeking to reach the guest earlier in the booking process. Determining which of these questions the lodging guest is asking first in the leisure travel decision path allows online marketers to insert themselves sooner resulting in a significant competitive advantage.

However, in creating an online booking path today, the vacation rental industry—and the lodging sector as a whole—has made key assumptions that may not be accurate. This assumption is that guests know when, where, and what before they know anything else.

Websites have been designed to allow guests to search by date, location, and accommodation type; and marketers pay big bucks for Google AdWords phrases such as “Corolla vacation homes,” “Chicago hotels,” or “Destin condo rentals.”

For travelers who know exactly where they want to go, when they want to travel, and what type of lodging they want before setting off online to find a vacation, the current online booking path is becoming increasingly efficient.

What if travelers take a different path?

However, the reality is that many vacationers don’t know those three W’s when they begin their online research.

Instead, travelers more often than not, know why, who, and/or how much before they know anything else.

For example, a family may know they want a holiday ski vacation but don’t know which destination is best. A group looking for a “girlfriend getaway” might be considering Sedona, Napa, New Orleans, or New York. A summer beach trip could be taken anywhere within a seven-hour drive of a family’s home in Atlanta. Golf trip alternatives might include South Carolina, California, or Alabama. This is true for fishing expeditions, leaf season outings, lakeside cottage getaways, whitewater rafting, or any number of potential trips.

For these travelers, online research becomes much more challenging.

If travelers know how much they want to spend but are flexible on location, the decision is even more difficult. For the family who knows they have $1,500 for a week at the beach but doesn’t know which beach destination gives them the biggest bang for their buck, searching online is almost impossible.

OTA Booking Path Assumptions

Currently, most vacation rental websites offer guests the option of searching by where, followed by when and what. On an OTA, travelers are expected to go to the site and select flights, hotels, vacation rentals, or cruises. From there, travelers are steered to select dates and a location.

However, if travelers would prefer to search by why (fishing, beach, ski, golf, etc.) or how much, there is no easy option.

For example, if a traveler wants to find a cabin rental within driving distance of home for four nights for under $500, where does that traveler start?

Herein lies the next opportunity in online travel search.

Why Is Giving Travelers the Option to Search by Who, Why, and How Much So Critical?

The reality is that by the time travelers know where, when, and what, they have already decided who, why, and how much.

In other words, for guests to have selected a location, dates, and what type of lodging they want, they will have already determined why they are going on a trip, who they are going with, and how much they want to spend.

For marketers look for ways to affect a traveler’s decision earlier in the decision-making process, the current booking path on OTAs is not sufficient.

The online travel sector will experience significant disruption when travelers are given a platform that efficiently allows them to search by who, what, when, where, why, and how much—or any combination of these considerations.

Taking the Travel Agent out of the Online Travel Agency (OTA)

Those of us over 45 years of age likely remember the role travel agents once played for vacationers. They had offices with bright destination posters on the walls and racks of brochures for adventures around the globe. The traveler would set an appointment to meet with an agent who would take careful inventory of all the things the traveler wanted to do on vacation, asking who is going on the trip, what kind of accommodations do they want, where do they want to go, why is the trip being taken, and how much the traveler wants to spend.

The agent then would research and provide options tailored to fit all these ideas and desires, creating a full vacation. These recommendations included accommodations, transportation, guided tours, and tickets for attractions and activities. In many cases, the travel agent also made restaurant reservations and included some special thank-you to be provided along the way (e.g., flowers in a hotel room).

The idea that today’s online travel agency (OTA) provides the guest with the kind of service that travel agents of yesteryear offered is laughable.

Today’s OTAs are merely lengthy catalogs of travel providers that begrudgingly pay for placement. If the traveler has not already determined specific dates and a narrow location, these sites are difficult to use for research. There is no travel agent to help you at an OTA.

The downside of using today’s OTAs is that travelers get boxed in to answering the wrong questions first, are fed results driven by OTA profits, and consequently end up with a travel experience that is not all that it could be.

Tomorrow’s OTA will provide this service.

Ideas for a Head Start

Vacation rental managers can get a head start and create a little disruption themselves by creating trustworthy, relevant, indexable content that helps their target market guests to conduct online research.

A vacation rental operator in Sedona might contact other companies in Sonoma wine country, Destin, and Key West to create an online “Guide to Girlfriend Getaways.”
A property manager in a value beach market might collaborate with like-type beach destinations to create “Family Beach Vacations for under $1,000.”

Whatever niche a company is in—family, luxury, attractions, parks, fishing, battlefields, etc.—marketers could find it useful to combine forces with other companies in similarly focused destinations to target guests who know who, what, why, or how much behind their vacations before they know when or where.

In the coming months, we can expect online travel technology and marketing to move toward targeting the traveler earlier in the decision-making process.

As the focus shifts from addressing the location and dates of a trip to addressing the intent or motivation for the trip, the game will change for all vacation providers. Vacation rental providers who are able to create innovative strategies to get ahead of this trend will be rewarded for their efforts.

OTAs have been learning from working with hotels and are applying these lessons to vacation rentals

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January 6, 2018

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At industry events, including VRM Intel Live, industry experts often talk about what hotels learned from working with OTAs and how vacation rental owners and managers can leverage this hindsight to gain an advantage and not repeat mistakes. They explain that hoteliers gave up needless percentage points, began paying and offering deeper discounts for higher placement, and became unnecessarily reliant on OTAs for bookings.

What is not often examined, however, is what lessons OTAs learned from working with hoteliers.

With short-term rentals, OTAs are getting somewhat of a “do-over.” These online giants have had a chance to reexamine how they aggregated, distributed, and monetized hotel inventory, and they are applying the lessons learned to short-term rental inventory.

Five Lessons OTAs Learned from Working with Hoteliers

1. The agency model is preferable to the merchant model…in all ways but one.

First, let’s look at the difference between a merchant model and an agency model.

With the merchant model, hotels give OTAs a net rate, to which a mark-up is applied to determine the sell rate to consumers. Consumers pay the OTA, and the OTA pays the hotel the net rate after check-in. With the agency model, the OTA charges the hotel a percentage “commission,” the guest pays the hotel, and the hotel pays the OTA their commission after check-in.

The hotel industry, especially in international markets, reacted better to the agency model, giving Priceline Group Inc (NASDAQ:PCLN) a competitive advantage over Expedia Inc (NASDAQ:EXPE).

However, OTAs preferred carrying the money between the booking date and the arrival date.

When Airbnb came along, it decided to take the best of both worlds, adding an agency-style commission—split between the guest and the supplier. It also became the merchant of record, taking payments, carrying the money, and remitting net payment to the supplier 24 hours after check-in. TripAdvisor (NASDAQ:TRIP) followed suit in 2015 for its performance-based listings, and Expedia-owned HomeAway (which also owns VRBO.com) now uses this model for its PPB listings.

2. Once suppliers are reliant on an OTA, the OTA can make changes to monetize supply.

OTAs learned that once hoteliers were reliant on the channel, the OTA could adapt policies to further monetize the platform. As a result, Airbnb, HomeAway, and Booking.com have found ways with their core supplier base to facilitate reliance with massive online ad spends, delivering a number of bookings to the vacation rental supplier without which they cannot operate.

This strategy has been even more effective in the vacation rental industry because a significant number of homeowners and managers got into the rental game as a result of the exposure provided by OTAs (including VRBO.com, HomeAway, Airbnb, Booking.com, and FlipKey). For these managers and owners, their primary—if not only—booking activity comes from one or more of these channels, with little to no direct bookings. In these cases, the OTA is not merely delivering supplemental revenue, but it is actually generating the majority of revenue.

This dependency enables the OTA to make drastic changes to its terms and conditions to further monetize supply without losing inventory.

3. Consumers will go where they can find the largest selection at the best price.

One way OTAs captured market share from hoteliers was by aggregating supply on a mass scale at a lower rate for travelers. Using net rates and rate-parity agreements, OTAs were able to undercut pricing, which proved to be key in gaining a following among consumers.

OTAs learned that establishing pricing levers is paramount to establishing a market-leading position, and it is even more important when creating barriers to entry for newcomers.

As a result, Airbnb, Booking.com and HomeAway have launched and are further developing revenue-management systems. In addition, OTAs are adding “offer strength” into their ranking algorithm, which rewards discounting with higher rankings. HomeAway even implemented a “pledge” a supplier must sign to become a Preferred Partner. This pledge says the supplier will “keep their rates equal to or lower than rates listed on other advertising websites for the same property.”

By maneuvering pricing, OTAs can swiftly gain market share and a substantial competitive advantage

4. Own the guest.

Over time, OTAs learned that hoarding guest contact information from the hotelier led to less communication between the hotel and the customer and reduced the hotel’s ability to make direct marketing offers and run loyalty promotions. OTA contracts often stipulate that hotels can’t market to customers who booked directly with the OTA. Last year, Booking.com stated that they will no longer provide hotels with customer emails. Neither Airbnb nor HomeAway share customer information until after the booking has been confirmed.

In addition, HomeAway recently announced a “match-back” policy for vacation rental managers using integrated software solutions that charge the management company 10 percent for any booking done with a guest who previously searched for a rental with similar dates on HomeAway’s family of sites.

From working with hoteliers, OTAs learned that if they can control the ownership of and communication with guest, the guest is less likely to move away from the OTA platform.

5. Don’t just aggregate brands; become the brand.

OTAs found out the hard way that a strong brand name is hard to replace. In the last two years, Hilton, Marriott, Hyatt, and the AHLA have worked to educate consumers about the benefits of booking directly with the property. In turn, OTAs began offering their own loyalty programs, rewarding guests who make repeat bookings regardless of the hotel—competing directly with hotel loyalty programs.

When it came time to look at how to display vacation rental brands, OTAs decided they have a unique opportunity to eliminate the supplier brand altogether and actually become the brand. Brand names, external links, videos, and any mention of the owner or manager contact information are being eliminated from the platforms.

Note: OTAs now know if they can keep the supplier market fragmented, their ability to grow is unlimited. Repressing the potential growth of big brand names in the vacation rental industry is in their best interest. While we’ve seen no direct evidence of OTA activity that seeks to squelch the growth of big brands, it will be an interesting area to watch for movement in the coming months.

And more…

OTAs have learned other lessons, as well. They have learned to leverage their high ad spends on Google to create extensive barriers to entry, and they’ve learned that smart acquisitions can move the needle to gain market share. They’ve realized that Instant Booking that is integrated across channels is necessary, and that gaining global market share is key to sustainable growth. They’ve also been testing revenue models and have found that there is a 15–30 percent take rate on the table—even if they have to split their cut between suppliers and the guests.

Most importantly, OTAs have the freedom to act—and act quickly—on the lessons they have learned to further advance and monetize their platforms.

Vacation rental managers and owners must do more than study the mistakes hoteliers made using OTAs along the way. They will also need to find a way to come together as an industry to collectively push back on changes that harm their businesses.

Is Orange Beach, AL ground zero for vacation rental bans?

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January 5, 2018

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On Thursday, the city council of Orange Beach, Alabama heard comments related to a proposed ban on all new licenses for vacation rentals (under 14 days) east of the Gulf State Park and north of Perdido Beach Blvd with the limited exception of a handful of TBD PUD-zoned areas.

What’s new, right?

Municipalities all over the globe are discussing similar restrictions. Why does a small town in Alabama matter?

For readers who do not know that Alabama has a beach, it does—a 32 mile stretch of sugary-white sand beaches on the northern Gulf Coast, bordering Florida, that attracts over 5.5 million visitors a year.

The city of Orange Beach lies directly on this strip of unlikely paradise and has over 10,000 accommodations, only 14 percent of which are hotel rooms. The remaining 86 percent are vacation rentals.

Orange Beach is a city whose economy is driven by revenues from vacation rentals. Over 5.5 million travelers spent $5.4 billion dollars visiting the Alabama Gulf Coast in 2016, making up over 40 percent of state’s travel-related expenditures.

In addition, tourism in Baldwin County, in which Orange Beach is located, accounts for over 49,000 travel-related jobs (up 3 percent) and generated over $22.2 million in lodging tax revenue (up 6.5 percent)

Orange Beach has just under 6,000 full-time residents.

The city’s proposed ban on new vacation rental licenses north of the beach road is a result of complaints about a small fraction of a percentage of the millions of people who visit the area.

One would reasonably expect a city whose entire sustainability is based on tourism and revenue from vacation rentals to be proactively friendly to the practice of renting on a short-term basis. Instead, this ordinance is a bleak indication of how municipalities are increasingly willing to “bite the hand that feeds them.”

Personal, anecdotal stories and no data

At Thursday’s meeting, city council members were united in their defense of this excessively restrictive ordinance, providing no data and several anecdotal examples in justification of the proposed ban of new vacation rental licenses for non-beachfront accommodations.

Orange Beach mayor Tony Kennon said, “I lived next door to a short-term rental, and it was a nightmare.”

He continued, “Jeffrey Dahmer was a nice guy, but I don’t want him living next door to me. I want to know who my neighbors are.”

Later in the discussion, Kennon also said, “For those of us that live here, we don’t want short-term rentals next to us.”

Councilman and former Alabama Power employee Jerry Johnson spoke at length about his personal experience in his own neighborhood and the nuisance of short-term renters.

One homeowner of a vacation rental respectfully spoke about his positive experiences as a rental provider and about his guests. Council member and social worker Joni Blalock countered, “You are one percent of what is going on out there. [Short-term guests] are renting homes and stealing from the neighbors.”

One percent.

One percent of what? One percent of all homeowners? Out of the 9,000 vacation rental owners, only 90 are operating responsibly? Doubtful. Blalock offered no data support her assertion.

Councilman and infectious control specialist Jeff Boyd echoed Blalock’s comments to the speaker, “You are an anomaly. You are one of a kind.”

Again, no data was offered to support the councilman’s conclusion.

Alternatives to a ban?

Councilwoman Blalock repeatedly claimed that the council had been looking at alternatives for the last two years, had explored all alternatives, and had no choice but to implement a ban on new non-beachfront licenses for vacation rentals.

Did they really?

Did they investigate noise monitoring products such as NoiseAware?
Did they consider requiring a local, 24/7 point of contact for each rental?
Did they discuss additional rental fees earmarked for trash and parking monitoring?
Did they debate occupancy requirements?
Did they discuss implementing “Good Neighbor” programs?
Did they explore the use of background-checking software?
Did they conduct a 12-month study and/or document the number of police responses resulting from vacation rentals vs residents and long-term rentals?
Did they look for ways to work hand-in-hand with HOAs and POAs –in conjunction with documented police reports—to limit rentals on an association-by-association basis?

If they did, not one piece of quantifiable data was introduced in the hearing.

Opponents of the ban outnumbered those in favor

At the meeting in Orange Beach, there were no “ban short-term rentals” signs or t-shirts or angry protesters. In contrast to other city council meetings across the country filled with angry residents, only three speakers were in favor of the ban while multiple residents whose incomes are tied to vacation rentals spoke against the ban, seeking understanding of the urgency and clarification of the ordinance’s exclusions.

Leonard Kaiser, founder of Kaiser Realty and Kaiser Sotheby’s asked the council to “slow down” and figure out how to achieve preserving neighborhoods while not limiting growth. Mayor Kennon shot down his comments and emphatically reiterated that he would vote “no” on any proposed PUD exemptions.

After the head of the Baldwin Country Board of Realtors and several real estate and vacation rental executives spoke and their comments were met with adamant and condescending responses by the council, opponents began filtering out of city hall with a collective realization that voicing their concerns would have no impact.

What is at risk?

The consequences of a ban are significant.

First, property values in a town with 9,000 short-term rentals, millions of visitors, and less than 6,000 full-time residents are, more often than not, based on projected revenue from rental income. Buyers and investors who sense increased regulations and restrictions tend to back away.

Donald Trump has built his presidency around deregulation, maintaining that eliminating government interference and needless regulations creates growth, innovation, development, and optimism within markets.

Second, tourism has the potential of stagnating or declining. With limited accommodations supply, beachfront rental rates increase, and the base customer—for Orange Beach, middle-class families—will find alternative destinations for their vacations. Once a destination has gone out of favor among its core customers, it is difficult to lure them back without extensive discounting, which leads to a debilitating business cycle in the both the real estate and the vacation rental industries.

Third, limiting supply in vacation rentals leads to a decrease in lodging revenue and ancillary spend. Already in Orange Beach, several restaurants have shut their doors. Even a small percentage drop in tourism dollars negatively impacts restaurants, attractions, retail, and service providers.

“Where is this ordinance off-base?”

Mayor Kennon asked, “Where is this ordinance off-base?”

This ordinance is “off-base” in the following ways:

Data: City officials—especially those leading influential destinations reliant on vacation rental revenue—have an obligation to collect, objectively analyze, and present data before banning rental activity for generations to come. Creating regulatory legislation without due diligence is irresponsible.
Solutions: Before legislating a ban, look at alternatives. Understand the financial impact of short-term rentals on the economy and talk to constituents from a proactive point of strength instead of a reactive place of weakness. Alternatively, the response could be: “I hear your concerns, and I agree, but we need to collect and analyze actual data to see how banning vacation rentals affects our overall economy before implementing a blanket ban. But we will implement new rules that include 24/7 points of contact, good neighbor policies, a new noise ordinance, and punitive citations.”
Targeting: Single family homes and condos across the street from the beach and along waterfronts are as popular for renters as beachfront property, especially for guests traveling with pets and visiting for fishing, boating, and sports events. This ordinance unnecessarily punishes buyers, homeowners looking to sell, future development, and overall growth.

State preemption bills

Several states, including Florida and Arizona, have created legislation limiting the ability for municipalities to restrict short-term rentals and protecting a homeowner’s right to rent.

Opponents of umbrella legislation point to states exerting themselves into city business as a reason to push back on a state short-term rental preemption bills. However—facing a case like Orange Beach, in which a municipality refuses and fails to collect, objectively analyze, and share data, and instead, arbitrarily acts on anecdotal evidence generated by a small percentage of angry neighbors—it is likely time for the state to look at the revenues and jobs created and make a decision to limit a municipality’s ability to restrict vacation rentals.

Elections matter

It is time for vacation rental managers and stakeholders to proactively look for candidates who are growth-minded and recognize the value of tourism, especially for municipalities that are reliant on its sustainability for the economies. Yes, residents are going to complain, and many of their complaints are valid. But growth-minded leaders will keep the big picture in mind, rely of data, and look for solutions instead of looking for blanket bans as an easy way to limit the angry phone calls.

As an option, stakeholders can reach out to the Vacation Rental Managers Association (VRMA), National Association of Realtors (NAR), Destination Marketing Association International (DMAI), and state tourism departments to bring heavier hands to the discussion and deliver much-needed data into the hands of city officials to help in their decision-making. And when state preemption bills are necessary, stakeholders will find it beneficial to work hand-in-hand at the state level.

Takeaways:

If you think your destination is immune, think again. If it can happen in Orange Beach, it can happen anywhere.
Councilman Jeff Boyd is running for Alabama State Senate, and he made his stance crystal clear about his lack of understanding about vacation rentals, about future development, and about the impacts of his decisions about overall growth.
Note: Want to know who’s happy about this ordinance? Hotels.
Related: Orange beach votes in moratorium on new short-term rental licenses.

South Lake Tahoe Adds More Restrictions and Larger Fines to VHR Ordinance

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January 4, 2018

The City Council of South Lake Tahoe implemented new restrictions and fines to their Vacation Home Rental Ordinance that took effect on December 22, 2017. Two of the most significant changes to the ordinance include the elimination of warnings to owners and guests and a minimum $1,000 fine per violation for both the property owner and the guest (fines were previously $250).

In addition to the new regulations, the City Council approved six new VHR code enforcement officer positions and hired Host Compliance, to assist with enforcement.

During the first weekend the ordinance was in place, eight violations were issued. Noise violations were expected to dominate the list of violations, but of the eight violations issued, only 1 included a noise violation. The others were for cars parked illegally or too many cars parked on the property, over-occupancy, and one for not having a VHR permit.

Updates to the VHR Ordinance include;

There will no longer be warnings. All code violations to the VHR Ordinance will result in a minimum $1,000 fine to both the owner or the property and the renter of the home.
If a VHR receives three fines within a 24 month period, they will lose their VHR permit. The cap on VHRs outside of the Tourist Core area will be 1,400 homes.
Parking at VHRs is limited to the garage and the paved driveway. Vehicles are not allowed to park on the streets of VHRs.
No excessive noise is allowed between the hours of 10 pm and 8 am. (Hot tub use is not allowed during these hours.)
Bear boxes must be installed in all VHRs by July 31st, 2018.
Camping is prohibited on VHR properties.
The owner of the VHR is required to inform their guest renters of the requirement to comply with all aspects of the City’s VHR Ordinance.

If the homeowner or management company makes the initial call on renters not abiding by the rules, they will not be held responsible or receive a fine.

“The new ordinance will make our jobs easier. By changing the culture of the guests’ behavior it will benefit the families next door, property managers and property owners.” said Carl Fair, Partner of Buckingham Luxury Vacation Rentals. “This is the first New Year’s Eve that I have not gotten a call in the middle of the night.”

RVShare names former HomeAway Executive Jon Gray as CEO

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VRM Intel Staff

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January 3, 2018

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RVshare, which was founded in 2013 and is the world’s largest RV rental marketplace, today announced that former HomeAway Chief Revenue Officer Jon Gray has joined the company as CEO. RVshare also recently announced that in addition to its 50-person-office in Akron, Ohio, it is opening an office in Austin to build out its executive suite and product and marketing capabilities. As CEO, Gray plans on splitting his time between the two offices.

Gray was the third HomeAway employee and held many leadership roles during his 12-year tenure with the Austin-based vacation rental giant. He led its Americas business, performance marketing, business intelligence and sales, growing the marketplace to a multi-billion dollar market leader. As Chief Revenue Officer, he helped guide the company’s sale to Expedia in 2015 and remained with HomeAway until early 2017.

After considering CEO positions at numerous consumer internet companies, Gray decided to take the top spot at RVshare because of its striking parallels to HomeAway, including being first to market, a large target market and a robust technology platform connecting owners to renters.

“The RVshare team has already built a great company, but we have only scratched the surface of where this business, and category, can go. Together with the team, I plan on introducing a whole new audience to the amazing experience of renting an RV, be it visiting a national park, making additional space for family over the holidays or tailgating at the big game,” says Gray.

RVshare co-founder Joel Clark, who served as CEO, will transition to the role of President, where he will continue to lead several key functions.

“Jon’s track record of building and scaling a marketplace business is remarkable. He was a superstar at HomeAway, rising quickly through the company’s ranks while managing large teams and delivering revenue well into the hundreds of millions. He is exactly the type of executive to take our business to the next level,” Clark says.

About RVshare (www.RVshare.com): Founded in 2013, RVshare is the world’s first and largest peer-to-peer RV rental marketplace, serving more than 60,000 RV owners across the US. With thousands of satisfied customers and a broad inventory ranging from travel trailers to luxury motorhomes, RVshare has the perfect RV for your vacation, tailgate, or temporary lodging needs.

Airbnb Amends Lawsuit Against Santa Monica to Focus on California Coastal Act and Federal Law

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January 3, 2018

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AirBnb did not waste any time in taking action to incorporate last week’s California Coastal Commission 9-2 vote to reject Laguna Beach’s ordinance, which bans short-term vacation rentals in residential neighborhoods, into its lawsuit against the city of Santa Monica. Airbnb has amended their legal complaint against the city to focus more on the California Coastal Act in addition to Federal law.

AirBnb’s attorneys say Santa Monica’s ordinance, which allows rentals for less than 30 days when the host is present, limits the supply of lower-cost vacation accommodations, making it harder for low and moderate-income Californians to access the coast.

The complaint states “All the things that make Santa Monica unique and attractive also can cause some of those lucky enough to call it home to be proprietary, exclusive, and protectionist, with the City’s policies historically reflecting an antigrowth mindset.”

“The 1,100 miles of California coastline is an invaluable public resource, and state law mandates that access to that publicly-owned land be expansive and available for all of California’s residents, not just those with sufficient resources to live near the ocean.”

The Commission has not commented on Santa Monica’s ordinance. However, city leaders have said they believe the current ordinance expands access to affordable lodging.

“The Power of a Vacation” now available on Amazon

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VRM Intel Staff

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January 3, 2018

“Through travel, we are able to see the world with new eyes and realize that, no matter many miles we roam, how many mountains we climb, or how many oceans we cross, our similarities are greater than our differences.” –Amy Hinote

Amy Hinote, founder and editor-in-chief of VRM Intel Magazine, the vacation rental industry’s leading news source, has published The Power of a Vacation, a book of daily travel inspiration aimed at encouraging travelers through the joy of wanderlust to open themselves to new adventures and to experience the world in a different way.

The book is a yearlong calendar compilation of quotes, fascinating facts, excerpts from studies, song lyrics, and more about the importance of taking a vacation. From Confucius to Rick Steves to Maya Angelou to Ernest Hemingway, The Power of a Vacation takes the reader on a yearlong journey, reminding him or her each step of the way how much the journey itself adds to one’s life and enhances the joy of discovery.

On her motivation for compiling the book, Hinote said, “I initially decided to write this book to show vacation rental providers how much what they do matters. But the more I got into it, the more I realized that there are centuries of observations about the importance of travel. It was a fun project that helped me realize how much traveling has meant in my own life.”

Readers are in for a treat as each day includes a meaningful reminder on how, through leisure travel, we are able to see the world with fresh eyes and how our mind, body, and spirit lift through new adventures.

For April 21, we are asked by Victor Hugo in Les Misérables, “What is most melancholy and more profound than to see a thousand objects for the first and the last time? To travel is to be born and to die in every instant. . . .” On October 12, we are advised by Tennessee Williams, “Make voyages. Attempt them. There’s nothing else.”

Liberally sprinkled with up-to-date facts about the mental and medical benefits of travel, The Power of a Vacation serves as a reminder that, from time to time, we all need a vacation.

The Power of a Vacation is now available for purchase through Amazon.

Savannah Sues Vacation Rental Operator Now That Short-Term Rentals Are Defined By City Ordinance

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December 26, 2017

In September 2017 Savannah City officials adopted an amended ordinance to define and create more structure for the growing number of short-term vacation rentals within the city. Now, just three months later, in December 2017, the City of Savannah filed a lawsuit against Mark Dewitt and his company Ardsley Park Savannah Properties, LLC. for operating vacation rentals in a district where they are prohibited by the city’s zoning ordinance. The lawsuit requests temporary and permanent injunctions halting what it claims to be illegal commercial use in residential neighborhoods, in addition to fines and attorney’s fees.

The lawsuit, filed on December 12, 2017 claims Dewitt advertises at least 26 unlicensed units, some located in districts such as Ardsley Park, that do not allow short-term rentals.

At this time, DeWitt has indicated he plans to fight the lawsuit. His attorney, Don Dyches, claims the city’s ordinance does not comply with state law, which protects a homeowner’s property rights. He also referenced the 2016 Georgia Court of Appeals previous ruling in DeWitt’s favor when the city filed a similar lawsuit.

In the June 2016 ruling, the Georgia Court of Appeals found that a previous ruling in 2013 against DeWittt, was based on existing laws that regulate “inns” but did not clearly define an “inn” and therefore could not be assumed to apply to DeWitt’s business practices. This was before the city adopted the current ordinance that defines short-term vacation rentals.

City Attorney Brooks Stillwell stated he believes the Court of Appeals ruling has no bearing on the current case.

Earlier this year, Georgia State Rep. Matt Dollar introduced legislation via HB 579 that would keep local governments from banning the short-term vacation rental businesses. If passed, this legislation would repeal the laws Savannah and other cities currently have in place.

Dollar indicated he is accepting feedback from interested parties on the proposed bill through the end of 2017.

Orange Beach, Alabama votes in moratorium on new vacation rental licenses

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December 22, 2017

Read the entire ordinance here.

Orange Beach, Alabama, located on the Gulf Coast, is a city reliant on a tourism economy led by lodging revenue from vacation rentals. It is difficult to find a working resident whose income is not tied in some way to the booming rental business along Alabama’s Gulf Coast.

However, last week, in a specially-called council meeting on Dec. 15, a six-month moratorium on new vacation rental licenses passed with a 5-0 vote, and went into effect on Dec. 20 at 5 p.m.

According to OBA, “Orange Beach leaders say they will use the moratorium period to draft a new ordinance to further restrict using individual homes for vacation rentals.”

It is the same story in municipalities throughout the US:

A traveler stays in a vacation rental in a beautiful tourist area.
The traveler likes the area so much, he/she decides to move there.
Once the traveler becomes a full-time resident, he/she no longer wants any other travelers there because it is a nuisance to have a new family next door each week.
He/she complains to the HOA and gets nowhere.
He/she then complains to the city council members about the “extreme” hardships of noise, trash, and parking.
City council members listen because the now-full-time resident votes, while non-resident property owners who invested in and support the community don’t get a vote.
The city council pushes some type of self-punishing regulations to appease a handful of agitated full-time residents.
Vacation rentals get a whole new set of regulations and restrictions.
Property rights are infringed upon, and real estate gets harder to sell.
Revenues to the city suffer, and growth slows.

Rinse and repeat.

Vacation rental industry advocates fight the same battle at the city level time and time again—so often that the Vacation Rental Management Association (VRMA) restructured its management to focus on government relations.

The reality is that the reported issues—noise, trash, parking, and tax remittance—can easily be addressed without restricting the property rights of homeowners to rent their homes on a short-term basis, and there are numerous examples of how these complaints have been addressed in other popular destinations.

The underlying issue, however, that some voting full-time residents don’t like having short-term renters in their neighborhood, is harder to combat.

City council members, officials, and property management companies must find a way to engage full-time residents to let them be heard, address legitimate complaints, understand the underlying reason for the protest, and implement good-neighbor policies.

In Orange Beach, new zoning ordinance proposals will be discussed at the next city council meeting on January 4 at 5:00 p.m. There will be the opportunity for public comment.

“Any changes to the short-term rental ordinance have long reaching effects for the real estate profession,” stated an email from the Baldwin County Association of Realtors. “This has the potential to impact property values, pending and future sales, and the rights of property owners.”

The email also said:

“This is a property rights issue that others believe can better be resolved by increased enforcement through police powers, citations to property owners, or revoking licenses of those rental properties with chronic complaints. Many HOA’s already have restrictions on short term rentals. Better enforcement by HOA’s could be an alternative to government restrictions. There was also a suggestion to deny any future licenses if they are in violation of an established HOA restriction. Currently there are only two types of licenses for rentals; more than 6 months, or less than 6 months. It is contemplated that the council may create a third category that takes into account the increased popularity of AirB&B type rentals. It is yet to be determined what geographical boundaries would be included in a new ordinance. Most of the city council agreed that beach properties south of Hwy 182 would not be treated the same as other areas of the city. But, others argued that some locations on the beach have a more residential nature and should be included.”

“This something that we’ve been working on for over a year, maybe even longer,” Councilwoman Joni Blalock said. “We’ve had multiple citizens come to our chamber as far back as two or three years ago complaining about short-term rentals in residential neighborhoods. Our planning department has had something written for a while trying to truly vet it completely out so we are doing this in the best possible way.”

Realtors and property managers are encouraged to be present at the meeting to voice comments and concerns.

California Coastal Commission Rejects Laguna Beach’s Short-Term Rental Ban

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December 22, 2017

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On Thursday, Dec. 14, the California Coastal Commission met in Dana Point, CA to review and vote on the city of Laguna Beach’s proposed short-term rental ordinance that effectively banned short-term vacation rentals in residential areas. The Coastal Commission, which oversees all coastal development and land use changes in the state and protects public access to the shoreline, rejected the ordinance with a 9-2 vote, arguing that it violates the state Coastal Act, which guarantees access to public beaches and parks.

The city’s ordinance halted new permits for short-term rentals from being issued in the city’s residential areas, which constitute 90 percent of the city, but expanded permits in the commercial and industrial areas.

Commissioner Steve Padilla went so far as to say “This is a loss, this is a net loss, and there is nothing in the record that suggests anything other than that. It’s discriminatory, economically. There is absolutely no doubt about that.”

“It’s not that we’re rejecting your intentions,” commissioner Mark Vargas said. “But there are other ways to reach the outcome without a general blanket ban in residential areas.”

Commissioner Ryan Sundberg expressed support of the city’s intentions but not the regulations, saying “There is no doubt many vacation units changes community character, but a total ban is not the right thing.”

In a second 7-4 vote, the commission approved 14 conditions in Laguna’s ordinance that will be required for all new short-term rental permits. These conditions include providing the city with emergency contact information for someone who can reach the rental home within an hour, limiting overnight guests to two per bedroom, providing a minimum of 2 designated parking spaces, and requiring permits be renewed every two years. Home exchanges, where property owners from different cities can swap homes at the same time are allowed but limited to one week, no more than two times a year.

The new rules will not go into effect until the City Council votes to accept the commission’s ruling. No date has been set yet but is expected to happen in early 2017. Greg Pfost, the city’s Development Director, would like to have Laguna resubmit a revision to its regulations for future approval.

In the meantime, the city’s regulations have not changed, and short-term rentals are allowed in residential areas with a permit.
The issue has been a controversial one in the city since May 2015, when the council stopped issuing new permits on short-term rental applications.

In August 2015, the City Council extended its moratorium on new permits while it weighed the issue. The council then approved a $90,000 code enforcement position to pursue illegal units by enforcing strict, daily fines of up to $500.

In October 2016, after 11 public hearings on the issue, the moratorium on issuing new short-term rental permits was lifted, and elected officials agreed to the ordinance that banned short-term rentals in residential zones. That ordinance has been awaiting the Coastal Commissions approval before going into effect. In the meantime, seven permits have been approved and four have been denied since the October 2016 moratorium removal.

Denver Having Issues Managing and Enforcing Short-Term Rental Regulations

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December 22, 2017

The City of Denver is struggling with its processes for tracking and enforcing its new short-term vacation rental regulations. City auditors issued a report on Thursday, revealing inconsistencies that could put the city at risk for a lawsuit.

After more than two years of meetings and community input on the issue, Denver City Council passed regulations for short-term rentals in 2016 to create a fair operating environment, assess the impact and ensure safety requirements. The regulations allow the rental of a primary residence for 30 days or less and require the collection of a 10.75% lodger’s tax from guests. While nearly $2 million in tax has been collected so far, some applicants who should not have been issued permits have them and many more who should, have not yet registered.

Between Jan 1. and Aug. 21, the Department of Excise and Licenses issued almost 2,000 short-term rental business licenses — but that is only 68% of the number of homes advertised online during that same time period. While this is a better adoption rate than other cities such as Portland and San Francisco, there is clearly still a ways to go.

The auditor’s report said the “city cannot fully assess the effectiveness of its short-term rental processes and procedures for licensing and enforcement.”

The audit found that a majority of lodger’s tax license and identification numbers on licenses were invalid. People were found sharing the same number, multiple licenses were issued to one person, or in some cases more than one address was registered to the same license.

A more systemic approach to collecting and analyzing data could give the city a better idea of how the “sharing economy” lodging affects neighborhoods and housing affordability, according to Denver auditor Timothy O’Brien.

“If the Department of Excise and Licenses does not track and analyze the data, officials should work with City Council to determine who is responsible,” Auditor O’Brien said. “A central goal in the ordinance is to determine the impact on neighborhoods and affordable housing, and some agency needs to be working on it throughout the process.”

“These discrepancies between the law and enforcement could lead to public confusion on how to stay in compliance, as well as the risk of perceived inequity,” Auditor O’Brien said. “This could put Denver at risk of legal action.”

The Department of Excise and Licenses responded that it “appreciates the auditor recognizing that we are in the early stages of implementing a new program and that we have made several steps forward.” It said it was in the processing of evaluating its strategies and will continue to review and adjust its practices.

For more information about Denver’s Short-Term Rental Certification process, www.denvergov.org/str, explains it step-by-step.

Tybee Island amends ordinance for short-term vacation rentals and increases fees

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December 21, 2017

After working closely with representatives of the short-term vacation rental industry, the Tybee City Council approved amendments to the city’s short-term vacation rental ordinance just in time to implement it for the coming year.

Amy Gaster, owner of Tybee Vacation Rentals and member of Tybee Island Association of Rental Agents (TIARA) said, “Now that the City has experienced its first year in managing STVR registrations and other matters, they have communicated openly about the need to amend the ordinance to allow for more dedicated City resources. I believe the proposed changes are positive for the City staff, the community, and STVR homeowners. We are grateful that, unlike many cities across the country (including Savannah), there were no onerous restrictions being proposed as part of this revision. Even though the fee will increase from $25 per year to $100 per year, property owners can choose to save money due to no longer being required to pay for land-line phone service (Tybee’s 911 system can track mobile emergency calls).

The city will use the revenue to fund city staff members who will work on STVR administrative functions as well as enforcement and compliance matters. In 2017 the city received around 1,100 STVR registrations and needs further staff support to manage this process. TIARA Managers look forward to working collaboratively with the new city staff to positively manage the specific needs of vacation rental properties, their owners, our guests, and the community.

“After two hurricanes in two years with many property damages, we are all looking forward to a smooth and successful 2018.”

The city’s new vacation rental ordinance, which takes effect on January 1, 2018, increases the annual registration fee for short-term rentals from $25 to $100 per year per home. With more than 1,100 short-term rentals on Tybee Island, this will add more than $82,000 to the city’s annual budget. The additional revenue from the increased fee will provide funding for two new city employees; a part-time administrator position to manage the registration and renewal process as well as an additional marshal to help with enforcement on nights and weekends.

The previous requirement that each property have a landline telephone on site was eliminated from the ordinance. The original intention was to provide phone service in case a guest needed to call 911. However, this proved difficult to enforce and because most travelers use mobile phones, it was difficult to know if it was a necessary requirement.

The annual registration fees are due January 1. However homeowners and managers will have a 90 day grace period to pay the increased fee if necessary.

Leisure travelers shun flying leading to opportunity for drive-to vacation rental destinations

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December 21, 2017

Americans believe flying is more frustrating than five years ago, according to a new Morning Consult survey released today by the U.S. Travel Association.

Travelers especially dread flying around the Christmas holiday, the time of year overwhelmingly cited as the worst for air travel. Because of such headaches, Americans avoided 32 million air trips last year, costing the U.S. economy more than $24 billion in spending.

According to the Morning Consult survey:

60 percent say airline fees, such as fees for checked bags, flight changes, and seat assignments have gotten worse;
51 percent say the overall cost of flying has gotten worse;
47 percent say airport hassles, like long lines, crowded terminals, and moving from one part of the airport to another have gotten worse.

In addition, a majority (55%) of frequent leisure travelers would take more leisure trips each year if hassles at the airport could be reduced or eliminated. Drive-to vacation rental destinations stand to benefit from American’s negative views on flying. With messaging designed to appeal to the drive-to market, vacation rental marketers can demonstrate the savings and benefits of traveling to near-by destinations for leisure travel.

HomeAway raises subscription fees 25% and adds new transactional fees for vacation rental managers

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Update: HomeAway’s Jeff Hurst discusses off-platform booking attribution

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December 16, 2017

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This week Expedia-owned HomeAway announced recent changes to its revenue model for vacation rental managers. The new pricing and fee structure includes a 25 percent increase in the cost of listing subscriptions along with a new fee assessment for property management companies using “integrated software” systems.

In an email to vacation rental managers, HomeAway informed suppliers it is increasing subscription fees from $399 to $499 per listing. In addition to the pricing increase, for vacation rental managers using “integrated software” platforms, HomeAway will invoice an additional 10 percent fee for direct bookings made that HomeAway can attribute back to inquiries on their websites in a process being referred to by property managers as “match-back.” Read the entire email here.

According to multiple vacation rental managers who are using software integrations, HomeAway will examine a vacation rental management company’s direct bookings, “match” email addresses and inquiries conducted on HomeAway’s sites “back” to direct bookings, and will invoice property management companies a fee which “will amount to 10% of the pre-tax total booking fee for direct reservations.”

The policy is based on an assumption by HomeAway that any revenue derived from a guest who booked directly with a vacation rental company—and who had previously inquired on a HomeAway site—should be attributed to HomeAway, and HomeAway is entitled to ten percent of that revenue.

The changes will be implemented “for all new subscriptions, and for all listings with an annual subscription term that is set to renew on or after March 15, 2018…Renewals of currently-active subscriptions that are due to expire before March 15, 2018 will not be subject to off-platform booking fees until the end of their one-year renewal term.”

The news sent vacation rental managers reeling.

One vacation rental manager on the East Coast tried to get more answers from HomeAway. “When the email came out this week I asked Homeaway for a preview of the new terms,” he said. “I received a response that they weren’t available yet. Honestly, no surprise there, but it would be nice to know the rules of the game in order to determine how we fit into this new model.”

Another manager in Florida said, “Imagine if Expedia charged Hilton ten percent for all direct bookings in which a shopper also did a search on Expedia for the same dates!”

“These changes are a deal breaker for us,” wrote a California-based vacation rental manager. “We will no longer be renewing or adding any new subscriptions and will allow all current subscriptions to expire. The changes seem like a desperate attempt to ‘skin’ the sheep (operators) rather than sheer the sheep in the face of either mounting competition or a flawed business model.”

Expedia’s Money Grab Since Purchasing HomeAway

Since Expedia purchased HomeAway in late 2015, the company has been aggressive in seeking to further monetize the HomeAway family of website marketplaces for vacation rentals.

On the same day that Expedia purchased HomeAway for $3.9 billion, it introduced a new fee for travelers that, according to then CEO Brian Sharples, “is expected to add an average of roughly six percent to most transactions that run through its online shopping cart.”

Since then, the HomeAway has made significant changes, including inching up and testing guest fees, requiring online booking on the platform, eliminating the ability for owners/managers to communicate with shoppers outside the HomeAway website platform, removing vacation rental brands, phone numbers, and external links from listings, adding a comparative pricing tool and changing lodging rate policies for software users, rewarding “offer strength,” changing the owner portal with direct owner communications, taking over the branding of PM guest apps, adding a “Premier Partner” program complete with a pledge to keep bookings on the HomeAway sites, and creating a search algorithm that rewards compliance of its policies.

As a result, while HomeAway is showing double digit YOY gains that are significantly contributing to Expedia’s wellness, suppliers are questioning whether or not the company’s growth pace is sustainable and are seeking out alternatives to reduce dependence on HomeAway.

Below is a hypothetical example of how HomeAway’s pricing increase and new fees might affect a vacation rental management company with 250 homes under management and an average rental revenue per home of $38,000:

The data in the chart is based on generalized feedback from property management companies, not data provided by HomeAway.

In this example, under the new revenue model HomeAway would benefit from $718,750 in annual revenue from an mid-sized vacation rental management company using its software tools.

A number of property managers have recently distanced themselves from HomeAway in an attempt to regain independence from the Expedia-owned marketing channel. In a recent panel discussion at the VRM event in Wilmington, NC, leaders from several large vacation rental companies discussed their decreasing reliance on HomeAway’s websites for bookings. One CEO told the audience that he had pulled all of his listings off of HomeAway’s channels and saw a three percent increase in overall revenue. Of the twenty-two companies in attendance, only a handful still use HomeAway for bookings.

As a result of HomeAway’s changes since Expedia’s purchase of the company, several online forums have sprouted, including the Facebook group “Say No to VRBO Service Fee” with over 4,500 members who regularly discuss ways to decrease reliance on HomeAway’s family of websites.

Update: HomeAway sent the following for clarification:

“We are charging 10% for bookings that originated with a booking request or inquiry that the traveler sent through HomeAway and that then convert into a booking. We are not charging a fee on bookings that are truly direct through the PM and not tied to any prior HomeAway booking request or inquiry.”

360 Blue Acquires St. Joe Club & Resorts’ Vacation Rental Program

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December 15, 2017

360 Blue, LLC announced it has acquired the entirety of the St. Joe Club & Resorts’ Vacation Rental program, adding over 235 homes to the company’s portfolio. Its second acquisition this year, Santa Rosa Beach-based 360 Blue now represents the largest collection of luxury vacation rental properties in the Florida panhandle.

Through the acquisition and an agreement with St. Joe Club and Resorts, all homes on the 360 Blue program will now benefit from the high-end 360 Blue service and property management model, as well as access to many of St. Joe Club & Resorts’ private amenities.

“Exceptional service is the principle foundation of our business,” says Ashley Horsley, co-owner and CEO of 360 Blue. “We started with a handful of high-end properties a decade ago and have now grown to over 560 of the most luxurious properties along the Gulf Coast. Our commitment to investing heavily in our company culture creates a working environment that makes it easy to deliver the best possible service to both our homeowners and guests alike. The addition of St. Joe Club & Resort’s Vacation Rental program will integrate seamlessly into our current operation. Our incredible team at 360 Blue is prepared and excited for this growth.”

San Diego City Council Adjourns without a Final Vote on Short-Term Rental Regulations

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December 12, 2017

After more than ten hours, which included listening to over 250 comments from the public, in addition to amendments flying back and forth between motions, the San Diego City Council adjourned without a decision on how the city will regulate short-term vacation rentals.

The San Diego City Council held a special meeting today to consider two proposed ordinances that address the permitting and regulation of short-term rentals. After years of avoiding a decision, proponents for both sides of the issue packed Golden Hall in Downtown San Diego to show their support.

The first proposal was submitted by councilwoman Barbara Bry. This was the more restrictive ordinance and proposes to limit permits to only one per primary residence and rental maximum of 90 days per year.

The second proposal was written by councilmen Chris Ward, Mark Kersey, Scott Sherman and David Alvarez. The proposal allows both whole home rentals, in which the owner is not on site and home-sharing, in which an owner makes a room or other space available within their primary residence. The permit does not cap the number of nights that can be rented per year but does require a three-night minimum stay. Individual homeowners would be limited to a maximum of three permits. Permit applicants would also be required to have owned the property for at least one year if they do not live in the home full time, and pay a per-night fee to fund affordable housing. There would also be new fees required for the short-term rental permits, which will fund more police and code enforcement officers.

Items council members could not agreement on included the definition of primary residence, how to enforce new regulations and how and if there should be limits on homeowners with multiple short-term rental properties.

To provide perspective on the scope of the short-term rental industry in San Diego, Host Compliance, a San Francisco-based company that provides short-term rental data and analytics to local governments reported there were approximately 11,347 short-term vacation rental units in the city. Of those, 8,855 are whole-home rentals and only 1,948 (22 percent) were rented for more than 90 days of the year. Beyond that, 5,047 (57 percent) of whole-home properties are rented out for fewer than 31 days a year.

The whole-home rentals, most of which are located within 10 specific communities across the city, make up the equivalent of less than two percent of the city’s total housing inventory, per the U.S. Census Bureau’s latest five-year housing estimates.

It is unknown at this time when the city council will revisit this issue.

To support the vacation rental industry in San Diego, visit Share San Diego www.sharesandiego.org and the Short Term Alliance of San Diego www.strasd.org.

Seattle City Council Voting on Rental Regulations Today!

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December 11, 2017

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Today is the final city council meeting where new rental regulations for the short term rental industry in Seattle will be decided. Local vacation rental managers have spent the last two years working with and sometimes against city council on behalf of their businesses, their employees, their homeowners, the many vendors they keep employed, and the industry as a whole in Seattle. They have helped educate the Affordable Housing Committee on our industry, and have helped craft a workable legislation that will both support affordable housing, and protect homeowners right to rent their properties on a short term basis.

On September 15th, 2017 the Affordable Housing, Neighborhoods and Finance Committee passed CB119082 and CB119083.

The City Council will vote on these recommendations today. There is just one amendment that is of concern and would eliminate many properties from being able to rent on a short term basis.

Amendment 5 (which will be Amendment 1 when presented to the City Council) proposes: “Reduce the area that would be exempt from the proposed limit on the number of dwelling units a short-term rental operator can operate. As proposed, CB 119081 would exempt units being operated as a short-term rental prior to September 30, 2017, that are located within the Downtown, Uptown, or South Lake Union Urban Centers. This amendment would reduce that area to apply only within the Downtown Urban Center, south of Olive Way and north of Cherry Street.”

While local managers agree that balanced regulations are necessary, they believe this additional addendum does more harm than good.

For more information and to learn how you can support local managers visit The Seattle Short Term Rental Alliance’s website at http://sstra.org/

Toronto City Council Voted 40-3 In Favor of Short Term Rental Regulations

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December 8, 2017

Thu., Dec. 7, 2017

Toronto city council approved regulations for short-term rentals in the city after a day-long debate on the issue. Council voted 40-3 in favor of the new regulations, and 27-17 in favor of restricting secondary suites.

The new regulations don’t ban short-term rentals, defined as less than 28 days, but instead require those who operate them to register their short-term rental, pay an annual fee of $50 and declare the property is their principle residence.

Only primary residences will be allowed to be rented on a short-term basis which can include up to three rooms for an unlimited number of days, or the entire house for no more than 180 nights per year. Secondary spaces, the most common form being a separate basement complete with a kitchen and bathroom, will not be allowed to be rented as a short-term rental.

Online Travel Agent platforms like Airbnb, VRBO, and others will also have to pay a one-time fee of $5,000 plus $1 per night booked through their site.

Airbnb estimates that 10,800 Toronto properties were rented via their site in 2016 and that over three-quarters of the rented spaces are in principal residences.

The main point of debate, which included council members yelling at each other, as well as frequent outbursts from members of the public, surrounded the permitting of secondary suites. It’s unclear what will happen with those units once the new rules take effect. However some attached secondary suites may be reconnected to the primary residence, and simply offered as a room in the home.

Regulations take effect July 1, 2018. However, the city plans to review the new rules again in 2019.

View the adopted agenda item HERE.

New Travel Show Spotlighting Vacation Rentals Gives Travelers an Inside Look at Alternative Accommodations

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