TRAVERSE CITY — Vacation home rentals are both a good thing and bad thing for Traverse City’s economy, city Planner Russ Soyring said.

Tourists that stay in them give a boost to businesses, including some that wouldn’t be here otherwise, Soyring said.

But they also squeeze the housing market, making it hard for businesses to hire as their potential employees struggle to find housing they can afford, he said.

Planning commissioners are eyeing new limits that would bar new vacation home rentals in the city’s C-1 Office Service and C-2 Neighborhood Center districts, documents show. Vacation homes are those rented for less than 30 days where no owner or host need be present.

Existing rentals would be grandfathered in, so long as the owners maintain their license with the city, documents show. So too would those who have applied for a license. And most contractors building properties they plan to use for vacation home rentals would be allowed to do so if they’ve expressed an intent, and have land use and construction permits in hand.

There would be many other places remaining where would-be owners could set up a rental, Soyring said. But he believes the proposed change would have an effect.

“We have several blocks of C-1 and C-2 along some of our major streets in town,” he said. “It would have an impact.”

Planning commissioners could decide on Tuesday whether to set a Jan. 7, 2020, public hearing for the proposed changes, which also would allow vacation homes in Transportation District-zoned land, documents show.

Soyring said that would be consistent with planning commissioners’ stated wish to bar short-term renting in districts that don’t allow hotels and other lodging, and allow it in those that do. The land in question is mostly at and around Cherry Capital Airport.

Regulating short-term renting is a hot topic, and not just in summer tourism destinations like northwest Michigan. Cities around the world are grappling with how to handle the popularity of platforms like Airbnb.com, and local governments in the area are adopting or considering their own rules.

Sam Flamont, a Traverse City real estate agent, said the proposed changes could help him, if anything. He owns three rentals in C-1 and C-2 districts that could see a boost in value if the city bans any new competition.

Flamont said he’s seen how people struggle to find houses for less than $250,000, and is all for more long-term housing. But he doesn’t think the proposed rule change will accomplish this.

“I think that there’s better ways to create long-term housing in Traverse City than a blanket ban in the district that is commercial use and the people using it are using it for commercial use,” he said.

 

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