Our new “quality of life” mayor campaigned for a moratorium on new hotels, but couldn’t get it through City Council.
Now, eight weeks into his first term, John Tecklenburg has opened the door to allowing more short-term Airbnb rentals to serve not residents but the millions of tourists who visit Charleston every year.
This promises to be a bonanza for landlords looking to cash in on the tourism economy — but not for those of us who actually live here or aspire to live here.
Every apartment rented to someone from Ohio for $200 a night is one less apartment available for the rest of us. Nowhere is that more critical than on the peninsula, where 35,000 residents are going to be in deep trouble if they have to compete with 5 million visitors for a room.
The short-term rental business is exploding in Charleston — even though it is legal in only a single neighborhood, Cannonborough-Elliotborough. Consider: The total number of Airbnb listings in Charleston spiked 62 percent to 708 in the last year, according to Airdna, a consulting and analytics firm that tracks Airbnb rentals. Six in 10 of Airbnb’s active listings are crowded onto the peninsula.
Once upon a time these might have been mom-and-pops renting out their spare rooms to help pay the mortgage, but that is increasingly spin, not reality.
Two-thirds of Charleston Air- bnb rentals are for entire houses or apartments. Top-tier two-bedroom rentals pulled in about $44,700 over the last year, or 2.5 times what they would fetch on a year-round basis.
Take, for instance, the “wonderful classic two-story house in the heart of Charleston.”
At $595 a day, it is a money machine for its owner, producing $75,000 in revenue in the last year, the No. 1 Airbnb rental in Charleston, according to Airdna.
In all, its “superhost” (a coveted designation in Airbnb World) is listing four rentals in a roughly one block area between Rutledge and Ashley Avenue and a fifth south of Calhoun.
“Live like a local in Charleston,” says one ad. How many locals do you know who can handle those rates?
All across the country, the short-term rental market is becoming about investors, not “home sharing.” Airdna made that clear in a report last year that sought to identify the most profitable Airbnb cities in America. Yep, Charleston makes that list, too:
“Several cities that may have been previously overlooked by investors jump off the page as great potential investment areas,” the Airdna analysis reported. “Charleston, South Carolina, appears to be one of these cities with a huge margin, with rentals available for $1,140 and 90th percentile Airbnb income at $4,974, there is profit margin potential of over $3,500 each month.”
The same report warned of a paradigm shift in the business model: “For those of you looking to use Airbnb as it was originally intended, the story isn’t as pretty. … While there are many people out there that have been covering their rents plus a little extra, on average this does not seem like a good gamble.”
Consider Sandy Tecklenburg, the mayor’s wife. She wasn’t fined $500 in 2014 by the city’s livability court for renting out a spare room in their West Ashley home, but for illegally listing as a vacation rental an investment property on Heriot Street on the Neck. The Tecklenburgs may not have understood the law, as they said last year, but they did understand the money to be made in short-term rentals.
“The sharing economy, as it’s called, is exploding all over the world, and for good reason — it’s making real people’s lives better every day,” John Tecklenburg then said in comments to the Charleston City Paper. “We don’t want to miss out on that here in Charleston.”
Advocates of the “sharing economy” like to compare Airbnb and VRBO to Uber. But they like to ignore a critical difference: Uber cuts prices for consumers by putting more cars on the road; Airbnb drives up prices for residents by taking homes out of the market for people who need them.
“The current system is totally out of control,” Tecklenburg said Thursday at a City Hall meeting to set up a commission to study short-term rentals. “We need to make a change.”
The first change should be to enforce the law.
Short-term rentals are legal in only a single neighborhood, but anyone with a computer can see there are Airbnb and VRBO listings all over the city, West Ashley and James Island included.
There are tweaks to be made to allow locals to share in the tourism bounty. The business of renting rooms to visitors was common in America centuries before Englishman Tim Berners-Lee gave us the Web.
But we should proceed with caution. And any changes should remain faithful to why we elected John Tecklenburg. Put our quality of life first. Locals first.
Steve Bailey is a former Boston Globe columnist who has returned to his hometown. He can be reached at email@example.com.