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A self-described \u201cvacation rental investor\u201d and\u00a0\u201cproprietor of fine Airbnbs\u201d blasted<\/a> South Lake Tahoe\u2019s short-term rental ban yesterday in a post on X<\/a> with over a million views.\u00a0<\/p>\n Rohin Dhar, who claims to have Airbnbs in Sonoma, Kauai, Taos, Mount Hood, Yosemite, and Asheville, wrote that the resort city\u2019s near total ban implemented more than five years ago created a \u201cshort-term rental Armageddon.\u201d However, instead of easing the housing affordability crisis within the city, he claims, \u201chome prices cratered, and people scooped them up as second homes,\u201d and he claims that some of them are sitting empty.\u00a0<\/p>\n \u201cThere is still a housing affordability crisis \u2026 When a resort area bans Airbnb, the only thing that happens is wealthy people get good deals on second homes that mostly sit around vacant,\u201d Dhar wrote on the social media platform, mocking the so-called Measure T.\u00a0<\/p>\n Measure T was a citizen-initiated ballot measure intended to regulate vacation or short-term home rentals in South Lake Tahoe, as the city\u2019s website states<\/a>. It went into effect at the end of 2018 and required the phasing-out of all vacation home rental permits in residential areas and across all multifamily properties over a three-year period. Of course, it also prohibited new vacation home rental permits in residential areas. But Measure T doesn\u2019t apply to existing or future short-term rentals in nonresidential areas\u2014and some people can still rent their homes, if they\u2019re a permanent resident and are renting their entire home for up to 30 days a year.\u00a0<\/p>\n In the summer of last year, an appeals court upheld Measure T\u2019s ban on short-term rentals after the South Lake Tahoe Property Owners Group filed a lawsuit\u2014although one issue, regarding permanent residents\u2019 ability to rent their homes, was sent back to trial court, according to<\/a> the Tahoe Daily Tribune<\/em>, a local paper.\u00a0<\/p>\n From the end of 2018 to the end of last year, home prices in South Lake Tahoe rose roughly 42% to an average home value<\/a> of $649,322, per Zillow<\/a> (although they are down over the past year). The median rent<\/a> for all bedrooms and all property types in the city is $2,975, which is close to 50% higher than the national median.\u00a0<\/p>\n A recently published opinion piece<\/a> in the Tahoe Daily Tribune<\/em> written by Amelia Richmond, president of Locals for Affordable Housing, pushed for a vacancy tax, claiming, \u201cAs home prices have doubled in the last decade, a staggering 44% of all housing in South Lake Tahoe\u2014over 7,000 homes\u2014now sit empty most of the year. Since 2000, the increase in vacancies has outpaced new housing construction, resulting in more vacant houses and fewer homes for residents.\u201d The housing crisis, she wrote, was pushing locals out of town.\u00a0<\/p>\n Clearly there\u2019s still an issue of affordability, one that must have been worsened by the pandemic-fueled housing boom, which sent home prices up substantially nationwide, followed by a surge in mortgage rates. But it\u2019s important to note that some research has shown that Airbnbs can impact long-term rentals. One paper<\/a>, for instance, found that a short-term rental ordinance in a city in southern California led to a 2.7% decline in contracted long-term rental prices on average\u2014meaning, that when you take Airbnbs away, generally rents go down.\u00a0<\/p>\n \u201cYou have oversupplied the market, so people stopped renting their property short-term, [and] they started renting it long-term,\u201d one researcher said at the time. \u201cThat\u2019s an increase in supply, and therefore that should put downward pressure on prices, and it did.\u201d<\/p>\n Still, it may not be a universal phenomenon, when it comes to rental properties or even location. But more often than not Airbnbs will be blamed for contributing to unaffordable housing costs, and property owners and Airbnb investors will argue the opposite. Airbnb even hired its first senior housing economist, with a goal to address \u201cmisunderstandings\u201d about the housing market and Airbnb, according to<\/a> Skift.\u00a0<\/p>\n Dhar did not respond to a request for comment.<\/p>\n<\/div>\n\nSubscribe to the CFO Daily newsletter to keep up with the trends, issues, and executives shaping corporate finance. Sign up<\/a> for free.<\/div>\n