Short Term Rentals
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The Short Term Rental Market Seems To Be Quite Active In and Around Harrisonburg |
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 If you are looking for a weekend stay, or a week long stay, in or near Harrisonburg there seem to be LOTS of options on AirBNB. The search above, showing 93 options, was with flexible dates in August / September / October. If you are considering purchasing a property to use as an AirBNB, keep in mind that there seem to be plenty of current options for those looking to book a short term stay. Driving a bit further east, there seem to be right around 300 available options at or near Massanutten Resort. What a difference from just a few years ago when short term rentals were just starting to pop up in this area! | |
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Perhaps Unsurprisingly, Most Harrisonburg Short Term Rentals Are Near EMU, Downtown or JMU |
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 Perhaps it will come as no surprise that most of the short term rentals in the City of Harrisonburg are located close to EMU, Downtown Harrisonburg or JMU. The map above shows short term rentals approved by the City of Harrisonburg as of May 1, 2020. While the City is in the process of adjusting some of their processes and guidelines for how to potentially use your property as a short term rental, the main thing to remember is that you need to get approval for doing so. Learn more about the process of establishing a short term rental in the City of Harrisonburg here. | |
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83% of Harrisonburg Short Term Rental Special Use Permit Applications Approved |
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 The Planning Commission for the City of Harrisonburg will hold a work session on October 29, 2019 at 2:00 PM to discuss Short Term Rental regulations. You'll find the agenda here and one of the attachments (this one) provides a concise overview of the status of each property for which a property owner has applied for a special use permit to use their property as a Short Term Rental. There are a few properties still working their way through the process, but of the 33 properties listed on the summary sheet, 29 have had an outcome of some sort and I illustrated those outcomes on the graph above. A few observations...
It will be interesting to see if there are any adjustments to the regulations or process for applying and reviewing those applications. Stay tuned -- or attend the work session! | |
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Thoughts and Questions on Short Term Rentals in the City of Harrisonburg |
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 More great reporting over at The Citizen about short term rentals...
And a few prior articles...
And to follow that recap, some thoughts and questions... Does approving a Short Term Rental remove a property from the local housing stock? Not really - or not most of the time? Most of the Short Term Rental applications have been from owners who live in their home and want to offer a portion of their home as a short term rental option. So - those properties aren't being removed from the local housing stock - the owners still live there. Further, the approval of a non owner occupied property as a Short Term Rental wouldn't remove a property from the "purchasable housing stock" since the owner is presumably currently renting it to a long term tenant. Technically, a property owner could decide to stop renting a house to long term tenants and start renting it only to short term tenants -- thus making it such that most occupants of the house would not be local residents, but just those passing through. In that situation it would, in some ways, be moving the property from the local housing stock to the "local hotel stock" - if that were a thing. This (converting a home from being occupied by the owner or a long term tenant to being occupied only by short term tenants) doesn't seem to be the majority of what is being proposed or considered - and my general sense (not scientific or data driven, I know) is that there is only so much of a market of would-be tenants for short term rental properties. If one hundred local property owners moved out of their homes, were approved to use them as short term rentals, and listed them on AirBNB, I don't think that all, or most or would be pleased with the rental demand from short term tenants. If one Short Term Rental is approved on a street or in a neighborhood will lots of other property owners follow suit and apply to become short rentals? Not really - or not most of the time? I think most folks who own and live in their homes in Harrisonburg enjoy living in their homes, probably by themselves. I don't think that the ability of one home out of 50 (in a hypothetical neighborhood) is going to cause more and more property owners to either take in short tenants to live with them, or to move out of their homes and start renting them to short term tenants. Will investors start buying up properties in Harrisonburg as short term rentals? Probably not, or not in large numbers? I don't think there is an untapped demand by short term tenants that would reward those investors with frequently rented short term rental properties. Yes, it is technically true that renting a property to 100 tenants for short terms instead of one tenant for the entire year is almost certainly going to be more profitable - but I just don't think there is that much demand by short term tenants. As a side note - there are plenty of localities where ordinances limiting short term rentals do not exist. I tend to think that investors would be more likely to invest in a property where short term rentals are not regulated before they'd invest in a community where there are somewhat restrictive regulations in place. Will the City's new Short Term Rental policy increase or decrease the number of City properties that are being used as short term rentals? To me, this is one of the more interesting questions. Property owners in the City have been operating short term rentals in the City for quite some time now (5+ years?) without actually having the legal ability to do so. Most of the concerns above seem to be regarding the hypothetical possibility that more and more and more properties will be come short term rentals. I tend to think that we won't see a large shift in the number of properties being used as short term rentals when comparing (for example) 2018 and 2020. Of the folks using their homes as short term rentals prior to these regulations:
Those four (non-exact, non-numerical) changes above would seem likely to result in a net decline in the number of short term rentals -- and moving forward, property owners would seem to be less likely to want to use their property as a short-term rental as there is now a higher barrier to entry in the form of an application fee and several months of processes and meetings. Should most Short Term Rental applications be approved? Not necessarily? City Staff, Planning Commission and City Council are looking at each application through many lenses to understand how each property being used as a short term rental would affect surrounding property owners, the neighborhood, etc. I think all of those property-specific perspectives are valuable and I am glad to see the thoughtful process being used for deciding whether to approve short term rentals. The broader thoughts of "maybe we shouldn't approve any or many short term rentals because of how it could have a large impact on our local housing market and housing stock" (my summary, not a quote) are a bit more difficult for me to agree with - at least given my understanding of the short term rental market as of today. Am I completely wrong to not be overly concerned about unintended consequences of approving many or most applications for short term rentals? Quite possibly! If lots of property owners decide they want to pursue using their property as a short term rental AND the City approves many or most or all of them AND there is an unexpectedly high demand from short term tenants -- then it is possible that there would be widespread negative unintended consequences. I'm not thinking this is likely - but I could be wrong. What are your thoughts? | |
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First Three Short Term Rentals Approved in Harrisonburg |
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 The City of Harrisonburg now regulates short term rentals -- and the first wave of applications have now made their way through the review process (City Staff, Planning Commission, City Council) and three properties have been approved by the City as short term rentals:
As context:
You can read more about this topic as follows...
As per the last article above... "All three permits were approved with conditions, including that the properties be the primary residence of the owner-operator, the owner-operator be present while renting out the space, and the owner-operator file a form guaranteeing that the "accommodation spaces" meet certain safety requirements, such as a door or window for immediate emergency exit to the outside." There are a pile of additional applications that will be reviewed over the next few months as we move towards August 1 when the enforcement of this new Short-Term Rental ordinance begins. | |
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Operating a Short Term Rental in the City of Harrisonburg |
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 After quite a long time (over a year?) of debating different paths for regulating short term rentals (such as through airBNB) the City of Harrisonburg has finally made a decision and set forth their official regulations. Lots (and lots) of information is can be found here, but let's review some of the key points to remember:
Again, you can find much more information here as well as links to additional information to get you started with registering your Short Term Rental. One interesting part of this new requirement is that we're now seeing somewhat more clearly where these Short Term Rentals are being operated. These are the property owners that have applied for Special Use Permits thus far, with a public hearing on each of them scheduled for May 8, 2019. The packet of information with context for these five applications, and staff recommendations is here.
You can track public hearings here. | |
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Scott Rogers
Funkhouser Real
Estate Group
540-578-0102
scott@funkhousergroup.com
Licensed in the
Commonwealth of Virginia
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