New ordinance creates guidelines, regulations for short-term rentals in Boston

Mayor Martin J. Walsh announced that today he will file a citywide ordinance establishing guidelines and regulations to better track and regulate short-term rentals in the City of Boston. As a new global industry that has a strong presence in Boston, short-term rentals provide both economic opportunities for residents and alternative temporary accommodation options for visitors.

The new regulations put forth in the ordinance aim to capture the growth of Boston's growing home-share industry, while including deterrents to help prevent operators from monopolizing Boston's housing market with short-term rentals. In addition, the regulations provide a standardized framework for regulating these units that both meet the evolving needs of the industry, provide protections for occupants and minimize the impact on surrounding neighbors of these units.

"Preserving Boston's affordability is key to keeping our communities stable and ensuring every person and family who wants to live here can afford to do so," said Mayor Walsh. "This ordinance is an important step towards our goal of reducing housing costs by creating disincentives to taking units off the market for use as short-term rentals. It also allows for the continued use of short-term rentals in scenarios that are non-disruptive to our neighborhoods and support our tourism industry. Boston is a great place to live and visit, and we look forward to responsibly incorporating the growth of the home-share industry into our work to create affordable housing for all."

In addition to classifying and registering the short-term rental units, the regulations include provisions that restrict the number of nights a unit can be booked per year, and require that each unit register with the City of Boston and pay an annual license fee.

The ordinance takes a three-tiered approach to classifying short-term rental units:

1. Limited Share Unit: consists of a private bedroom or shared space in the operator's primary residence, in which the operator is present during the rental. The fee associated with this classification is $25 per year.
2. Home Share Unit: consists of a whole unit available for a short-term rental at the primary residence of the operator (unit in which operator resides for at least nine months out of a 12 month period). The fee associated with this classification is $100 per year.
3. Investor Unit: consists of an entire unit available for a short-term rental in a whole dwelling that is non-owner and non-tenant occupied. The fee associated with this classification is $500 per year.

The regulations also provide protections for the occupants of the short-term rental unit by prohibiting any property with outstanding housing, sanitary, building, fire or zoning-code violations from being listed.

To assist with the enforcement of regulations, booking platforms will be required to provide the City with monthly data and information relative to the short-term rental listings that detail the location and occupancy numbers.

Today's announcement builds on Mayor Walsh's commitment to addressing the housing demands in Boston. In April 2017, Mayor Walsh signed an executive order that laid out a roadmap for the collection of information on short-term rental units in Boston and directed city agencies to coordinate efforts in addressing the commercialization of short-term rental housing operations in the City of Boston.

Data shows that the availability of short-term rental units has a direct correlation to housing costs. A 2016 study by UMass Boston found a 0.4% increase in rent prices due to increases in AirBNB listings, and a nationwide UCLA student also found a 0.42% increase.

In addition to rent increases, the commercialization of short-term rentals in residential dwellings and residential neighborhoods has the potential to reduce availability of long-term housing for owners and tenants alike, and is contrary to the Administration's goal of adding 53,000 units of housing across a variety of income levels by 2030.

To date, the Walsh Administration has committed more than $100 million in funding to the creation and preservation of affordable housing. Today's announcement builds on the City's preservation and anti-displacement goals, outlined in Housing a Changing City: Boston 2030, Mayor Walsh's housing plan, and the housing goals laid out in Imagine Boston 2030, Boston's first citywide plan in 50 years. As part of both plans, Boston has prioritized increasing the overall housing supply, with a focus on creating and preserving affordable housing.

Since the launch of the housing plan, 24,454 new units have been permitted. When complete, these developments will be enough to house 48,600 new residents, and begin to relieve pressure on rents in existing housing.  Of these, 4,649 new income-restricted units have been permitted, of which 2,234 are targeted to low income households. There are an additional 4,240 deed-restricted units in the City's development pipeline.  

In addition to creating new housing, the Walsh Administration is focused on protecting the tenancies of Boston's residents, launching the nation's first Office of Housing Stability in 2016.  In addition, Mayor Walsh has filed an anti-displacement legislative package at the State House, and strengthened tenants' access to information by creating the city's first online guide to the eviction process.

To view the full ordinance, click here.