Too Many Vacation Rentals In Annapolis Worry Some Residents

ANNAPOLIS, MD — Unlike bed and breakfast facilities, short-term vacation rental properties have few controls on them and some Annapolis residents worry about growing problems with the units. The Annapolis City Council will discuss the subject of rental unit and short-term residential rental licenses at its 7 p.m. meeting on Monday. Resident Victoria Duncan told Patch that numerous people have presented city leaders with alarming information, including Alderman Ross Arnett, that shows an overabundance of owner-unoccupied short-term vacation rentals in the city.

According to information provided by Duncan to Patch, in Annapolis the number of vacation rentals has increased 288 percent in the last three years and the number continues to increase 28 percent per quarter of a year.

"Chances also are that the STVR next to your home is an owner-unoccupied STVR. In other words, this is not the home of a primary resident who simply rents his home out for commissioning week and boat shows while taking a much-needed vacation. This is called an owner-occupied STVR and it’s a traditional vehicle in which residents generously rent their homes out for peak events," Duncan's information said.

However, through her research, it has been discovered that numerous STVRs are owned by out-of-town investors who have converted homes into more fluid facilities.

"Some investors own more than one property. Their paying 'guests' are strangers who do not belong to civic organizations, churches or contribute to the non-profits in our area. They do not vote or send their children to school here. Annapolis, at least, the historical residentially zoned area, has become a district of rolling suitcases, late parties, over-flowing trash cans and faceless strangers," Duncan's information revealed.

Duncan told Patch that short-term vacation rentals are "the biggest threat to the neighborhoods of Annapolis in over 20 years."

"The last kind of threat like this was in the 1990s when bed & breakfast inns became popular. At that time, the City Council worried about the effect so many of those commercial properties had upon the neighborhoods and instituted legislation that limited their growth. That legislation has been effective and we need something similar for STVRs since they are a similar commercial entity," Duncan told Patch.

After Duncan and her husband downsized to living in town in a residentially zoned area instead of the suburbs, they missed connecting with neighbors. Many neighbors actually turned out to be commercial enterprises operating in residential zones, she said.

"I cannot operate a counseling office in my home so are they allowed to operate a hotel next door? In fact, on my doorstep, I can see five STVRs without craning my neck. Three of these are owner-non-occupied. Nobody lives there ever. Sororities parties and wedding parties and football parties take place every weekend. Every single weekend. We do not know our neighbors and this is troubling. Community is disappearing in Annapolis in favor of tourism and lining the pockets of out-of-town investors. It really comes down to this: Is Annapolis going to be a community of second homes and investment properties aimed at extracting as much income out of our town as possible or is it going to be a community of residents who provide stability and resources for the city we love? The very soul of Annapolis hangs in the balance," said Duncan.

Attorney Carl Larkin confirmed that bed and breakfast homes are more regulated than the proposed ordinance for vacation rentals.

"Bed and breakfasts are limited to four per block. There is no proposed limit on short-term rentals," Larkin told Patch. "Bed and breakfasts cannot be located adjacent to one another. There is no such limit on STRs. No bed and breakfast can be located in an attached dwelling. There is no such restriction on STRs. The owner and operator of a bed and breakfast must reside on the premises. Not required for a STR operator. A resident manager is not allowed to operate a bed and breakfast. They would be allowed to operate a STR. No cooking facilities are allowed in the guest rooms of a B&B. No such restrictions on a STR. Bed and breakfast homes shall have interior stairs. No such requirement for STRs. These two home share operations would be competitive if they were equally regulated."

As a resident of East Street, Duncan said she knew there were quite a few short-term vacation rentals near her. But because they are not marked and not advertised anywhere except for rental platforms, residents "don’t really understand how badly this has infiltrated our city."

"Some streets are almost entirely gone and others are in danger of going the same way if something isn’t done to control this. There is a license required for short-term rentals but not an actual STVR license and it is not enforced. Many are operating without a license and without any kind of safety inspection. There is a frantic push now to get licensed because the owners expect that licensing and regulations may soon be required and they are hoping to be in a position to be grandfathered in," said Duncan.

Resident Christina Cole told Patch that the most "egregious example I've seen" is Bozzuto's marketing materials for West141, which not only lay out at timeline for peak STVR pricing, but note that "there are several rental management companies...to make renting from afar a breeze."

"It's one thing to know that one to two houses beside you is an unoccupied investment property available for short-term rental; it's something else entirely to realize that your 'zombie neighbors' are part of nearly a quarter of the houses bound by USNA, Main St., Randall St. and College Ave. that are made available as whole-house STVRs. Eighty-two percent of these whole-house rentals are owner-unoccupied. Based on total bedrooms, that's up to 500 people that could be living downtown — if these homes were available for long-term leasing instead," Cole said.

Mark Mhley of Annapolis said the growth in the area has been confirmed through an analysis of a sector of the historic district between King George St. and Main St. He was "blown away" by what was found.

"Twenty-three percent of the 388 properties were listed as STRs, and of those 82 percent were owner-unoccupied STRs. That means one in five homes is now an owner-unoccupied STR that sits vacant Sunday night to Friday and is used as a turn-key hotel on the weekends. Only 58 of the 73 owner-unoccupied STR properties we identified are licensed to operate through the city (again, in violation of conforming to zoning standards) and 11 more are in various phases of license-approval. That is 69 of 73 are being tracked by the city. So, whatever regulations the city passes, forcing unlicensed STRs to license really won’t have an impact in that sector of downtown," said Mhley.

As other communities draft and pass regulations for short-term vacation rentals, Cole worries about the future of Annapolis.

"I wonder how many more homes will be reallocated to the STVR pool and made unavailable to those of us who actually want to live here on a long-term basis. I'm tired of wondering if the buyer of the next house on the market will actually live in it — or if it will become another turn-key hotel, with another parade of wedding parties, reunions and tourists who aren't vested in our city," said Cole. "At the same time, I wonder about the value of our own investments. We all thought we were moving into a residential neighborhood. Who's going to be interested in our properties — should it ever come time for us to move — if/when our homes become surrounded by commercial uses?"

Chris Buchheister, VP Ward One Residents Association, said the city’s "total lack of code enforcement" has accelerated what he calls a "gold rush" of investors buying homes as businesses.

"When a whole house STVR house can bring an investor significant annual income, young families are no longer able to buy into our neighborhoods. Teachers, fire fighters police, newspaper reporters can’t afford to live here," said Buchheister.