Short Term Rentals
Deplete Our Housing Supply
In the City and County of Santa Fe
Over the past 15 years, short-term rentals have become popular with both tourists and investors.
What began as renting out a spare bedroom has become an industry that relies on converting existing homes into full-time lodging enterprises without a zoning change. Often referred to as “airbnb’s”, short-term rentals are existing homes, condos, guest houses and apartments - or portions of these dwellings - that are rented out for less than 30 days. When an existing home is converted from a residence into a motel, one less home is available for locals to rent long term or buy.
Currently, there are as many as 3,000 short-term rentals in the City and County of Santa Fe. Between the City and the County, less than 750 of these are owner occupied. Non-owner occupied short-term rentals contribute to the shortage of housing in all price ranges and drive up the cost of rent and home ownership. Existing housing should be protected for our residents who live, work and retire here - our seasonal and full-time residents.
Santa Fe is the Capital of New Mexico as well as a regional center for healthcare, education, hospitality, technology, outdoor recreation and the arts. Attracting and retaining qualified professionals and skilled workers depends on a stable housing supply in all price ranges. Tourism is an important economic sector, but tourists are not entitled to take existing homes away from locals.
Revise the Short Term Rental Ordinances in the
City and the County of Santa Fe
Both the City and County of Santa Fe currently have Short Term Rental Ordinances. In spite of official declarations that these ordinances are designed to protect our long-term housing supply and the character of our neighborhoods, the current STR ordinances actually provide opportunities for investors to buy our single-family and multi-family dwellings and convert them into full-time motels. These ordinances aren’t regulations, they are invitations for investors to establish lodging businesses in neighborhoods throughout the City and County. In practice, these ordinances actually make it difficult for locals to find homes to rent or buy as they can’t successfully compete with speculative investors and second-home buyers who intend to operate a profitable business.
The City of Santa Fe’s Short Term Rental Ordinance allows 1000 STRs on Residentially-Zoned Properties and an unlimited number of STRs in Non-Residentially Zoned Districts: This policy allows investors to buy up as many homes, condos and apartments as they can afford in our most historic neighborhoods. If we have any hope of preserving the character of Canyon Road, the Railyard and the Plaza, we need to restrict STRs in all neighborhoods to “owner-occupied” residences. It is estimated that less than 500 of the over 1200 legal STRs in the City are owner-occupied.
Click here to read the City of Santa Fe Short Term Rental Ordinance
Santa Fe County now allows any individual to convert two existing homes into motels without a change in zoning: The County ordinance allows investors to own two non-owner occupied STRs. There are many subdivisions that have been exclusively residential for decades and now include scattered-site motels. This policy directly contradicts the stated goal of minimizing “the negative impacts of short-term rentals on the County’s neighborhoods, housing supply, economy and environment”.
Click here to read the Santa Fe County Short Term Rental Ordinance
In the State of New Mexico, a short-term rental (STR) refers to a residential rental of less than 30 days. The rent charged is subject to GRT(gross receipts tax) and lodgers tax because a STR is a lodging business.
An “owner-occupied” STR is a dwelling that is the owner’s primary residence. The owner may be renting a part of their home or their guest house (ADU) for periods of less than 30 days.
A “non-owner occupied” STR is a dwelling that is used primarily as a motel. A non-owner occupied STR reduces the availability of housing for residents to rent long term or buy. Second homes that are being rented as STRs are non-owner occupied. Nuisance complaints from neighbors are more likely to occur at non-owner occupied STRs.
Month-to-month rentals are also an important housing option for seasonal workers, visiting nurses and residents in transition between jobs or permanent housing. Rentals over 30 days are not subject to GRT or lodgers tax.
Long-term rentals provide stable housing for our residents who work or retire in Santa Fe. New residential building permits should be keeping pace with population growth in both the City and the County, yet our housing availability continues to decline year over year. Existing homes are being converted to STRs and that is depleting our housing supply.
In order to protect housing availability and preserve our neighborhoods, Short Term Rental ordinances need to be strictly limited to “owner-occupied” properties and include a “primary residence” requirement. Ordinances around the U.S. include “proof of primary residence” in order to obtain a short-term rental permit. The majority of STR permits in the City of Santa Fe are issued for “non-owner occupied” properties. The County’s recently approved STR ordinance created the opportunity for investors to buy homes throughout the County. Every one of these homes that is converted to a motel depletes the availability of homes for locals to rent or buy.
We Want Our Houses Back
What’s the Problem?
Our City Councilors and County Commissioners need to recognize the negative effects of allowing investors to convert our homes into motels.
Our current STR ordinances must be updated in order to protect our housing supply and our neighborhoods.
City and County Staff must follow effective procedures for identifying and shutting down illegal STRs. There must be significant penalties for property owners, property managers and marketing platforms that break the law.
Long-range growth proposals include plans for encouraging guest houses (ADUs) in both the City and the County. Other cities have used this strategy to increase housing density. It is essential that strict STR regulations accompany any plans for increasing housing density so that ADUs will meet our housing needs rather than become more motels.
Prioritize Housing over Tourism
Cities, Counties and States across the US are working to protect existing housing inventory and restore neighborhoods for residents.
There are reports almost daily of how cities around the world are restricting short-term rentals in order to restore existing homes to their housing supply.
Restricting STRs to owner-occupied properties allows for an alternative to traditional hotel stays while offering a homeowner the opportunity to supplement their income.
Existing STR ordinances around the country provide excellent models for revising Santa Fe’s ordinances.
Federal judges have consistently upheld the right of Cities and Counties to create and enforce zoning ordinances.
Do Something
Every citizen who is concerned about the availability of homes to rent or buy can take some small action:
Consider the negative impact of STRs on our housing supply and the character of our residential neighborhoods.
Talk with your neighbors.
Write a Letter to the Editor.
Contact your City Councilor and your County Commissioner.
Attend a public hearing.
What talking points speak to you? If political action is outside your comfort zone, ask a friend to help you write an email to your City Councilors and County Commissioners. It only takes a few minutes of your time.