Are short-term rental regulations coming to Houston?

HOUSTON, Texas (KTRK) -- The City of Houston could finally join other cities in an attempt to provide some regulations over short-term rentals, known as STRs.

Usually booked through platforms such as Airbnb or VRBO, short-term rentals can be a boon to property owners while a headache to some neighborhood advocates. Regulating STRs requires balancing a variety of interests, and that's certainly proving to be the case in Houston.

In 2024, a firm conducted a comprehensive study on STRs for the City of Houston, showing around 11,000 STR units in the city. The majority of these units are concentrated in the city core, specifically neighborhoods like Montrose and the Museum District.

Noel Freeman's garage apartment has been in the short-term rental market for eight years.

"I'm a good host, so I'm going to do what I'm going to do," Freeman, who has kept close tabs on the proposed regulations, said.

In his opinion, it doesn't solve people's complaints about STRs while increasing work for good owners.

The proposed ordinance would require all STR owners to register and pay a $275 yearly fee. If owners don't comply with city regulations such as the noise ordinance, they could face potential fines of $500.

"We understand that regulations are inevitable," says Freeman. "But this ordinance doesn't do anything to solve the problem. The good hosts are going to be compliant, and the bad hosts are just going to ignore it because that's what they've been doing all along."

Kathryn McNeil is on the other side of the debate, though she's not a fan of the proposal either. McNeil, a long-time Museum District homeowner, is frustrated by what she says is an STR apartment complex next door.

"These people that come in and create this business model, of buying all of these properties, and turning them into Airbnb, they also ruin the civic fiber of the neighborhood," McNeil, who believes the proposed ordinance doesn't go far enough, said.

She wants the City of Houston to require owners of small apartments rented out on STR platforms to follow hotel regulations.

"We don't see how it addresses our specific neighborhood's problems, which I know is throughout the city," she says. "We have a small apartment complex, which I know is more of a hotel than a residential apartment complex."

City regulators admit it's hard drafting an ordinance that doesn't impede good hosts while addressing neighborhood concerns. An additional challenge is what's been happening in other cities that have also tried to pass STR regulations. Oftentimes, people or businesses upset with the regulations sue the cities, and the regulations end up mired in legal battles for years.

"This is the city of Houston's first attempt to put down some regulations for short-term rentals," Billy Rudolph, a spokesperson for Houston's Department of Administration and Regulatory Affairs, said. "There are different cities in the state battling in court their regulations, so we're stepping out and making sure we find a balanced approach here."

Rudolph says the department is expecting tweaks and suggestions along the way because many cities are facing similar challenges.

"We plan on putting together a dashboard where the public can get on and see all those that are registered. So it should allow us to see how many are out there and where they are. Once the ordinance is in place, there could be some changes we can make in the future," Rudolph said.

Both public testimony and City Council discussion of the issue are expected next week.

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