Berkshire Business Outlook: Short-term rentals test towns

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Battle lines are being drawn in several South Berkshire towns between inn owners who say they're losing business to short-term vacation rentals on Airbnb and other online sites and homeowners seeking extra income to meet housing expenses.

With no proposals yet from state lawmakers grappling with potential taxation and regulation of Airbnb and its competitors, Lenox voters may face a potential zoning reboot at a town meeting later this year.

It's a high-stakes issue in the town which has nearly 1,000 of the county's 4,000 lodging rooms. The 11.7 percent tax on room rentals shared by the state and town accounts for nearly $2 million toward the municipal budget's bottom line, which helps to keep property taxes increases manageable.

Last summer, as many as 300 rooms were available in Lenox on Airbnb and other sites. Stockbridge and Richmond also had ample listings.

The Lenox Planning Board has held multiple public forums to discuss possible guidelines for house rentals of less than 30 days, that are not covered in the town's zoning bylaws. Traditional, long-term summer rentals (a month or more) are legal and are not targeted for review.

Concerned innkeepers have complained that they've lost lucrative bookings. In one case, a $25,000 rental of a 28-room inn for Columbus Day weekend fell through as vacationers gravitate toward house rentals.

The lodging proprietors point to declining year-round occupancy rates well below 50 percent. They list the financial burdens of health and safety inspection fees, sprinkler-system upgrades, higher commercial property taxation, maintenance expenses and other "costs of doing business."

Some inns are even listing rooms on Airbnb and VRBO, among others, to keep pace with shifting preferences by travelers who prefer a "home away from home" experience.

Some entrepreneurs are buying up some of the few moderately-priced houses in Lenox and adjoining towns to operate them commercially as short-term rental properties.

But residents active on the short-term rental online market are equally impassioned about their need to help cover homeowner costs so that they can keep living in Lenox, Stockbridge and Richmond. Several have cited examples of elderly family members that passed away and left their houses to siblings or offspring who can only maintain the properties by seeking short-term vacation rentals.

With another busy tourism season just two months away, the Lenox planners are still trying to come up with recommendations for a zoning formula to protect the hospitality industry as well as homeowners. Any change would require two-thirds approval from town voters.

In the Richmond and Stockbridge town halls, those discussions are just beginning.

So far, there's general agreement that online short-term rentals are here to stay. The issue looms even larger year by year. But a compromise fair to all sides remains elusive, unless and until the state legislature comes up with guideposts that local communities can adapt to meet the concerns of residents and hospitality business owners.

Clarence Fanto can be reached at cfanto@yahoo.com.




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