State College further restricts short-term rentals

The local crackdown on short-term rentals continues.

State College borough enacted an ordinance regulating rentals such as those through Airbnb and Vrbo last year that required that the person renting the property also live there eight months out of the year. That ordinance has yet to be enforced, however.

On Monday, the State College Borough Council voted to further restrict short-term rentals.

Operators are now required to obtain a $300 license, provide off-street parking at the rental property, and limit use of the property as a short-term rental to 120 days per year, among other things.

Centre Daily Times reporter Josh Moyer published a story Sunday that looked into the complexities of short-term rentals — through websites like Airbnb and Vrbo — in State College borough. 

He reported that, so far, about 200 properties have been identified as operating as short-term rentals in some capacity — from homeowners that open up a spare bedroom for football weekends to property managers renting out entire homes.

We spoke with Moyer this week about what the restrictions mean for State College residents. Our conversation has been edited for length and clarity.

Talk of the Town: What made you want to write this story? What makes it an important issue to cover?

Moyer: I think what made this issue so important is that it’s been a pressing issue with State College for years. … In researching this, something I didn’t even realize is that short-term rentals for football weekends really go back to 2006 or 2007. This has been around for a long time, and it’s only gotten bigger. It’s not just restricted to State College; we’ve seen surrounding municipalities that have passed similar ordinances. We’ve seen this be a national issue. We’ve seen it in other Big 10 cities.

State College was faced with an interesting dilemma because there’s a lot of gray area with this; it’s not black and white. If you want to punish the “greedy companies” that are buying up properties just so they can turn them into these sorts of hotels — by disincentivizing those types of faceless companies, it’s really difficult not to also hurt the struggling homeowner who’s just trying to maybe rent out their basement to offset this unprecedented inflation.

Talk of the Town: From your reporting and conversations with borough residents, what are the biggest concerns about short-term rentals?

Moyer: It’s really twofold. One is that some owners — who may not even live in state or may be large businesses themselves — they really don’t have any incentive to keep the property nice or to have responsible people staying there for a few nights. … I think the other part to it … is the fact that it’s really negatively impacting the housing market.

And it’s difficult to say in State College to what degree that is, but studies have shown that the more Airbnbs you have, the fewer long-term rentals you have and the more expensive the housing market becomes. So people are being further priced out of the housing market as a result of people buying up houses just to use them as Airbnbs.

And then you have one more side of local homeowners who — I spoke to a retiree who is on a fixed income. Her children are out of the house now so she has these bedrooms that she doesn’t need or use, so in order to afford her home now, she simply rents out those extra bedrooms and that way she’s able to stay in the borough. If she didn’t have Airbnb, she might have to downsize or move out. This is something she’s called home for over two decades. So there are so many competing interests with this story. I think that’s what makes the issue so unique.

Talk of the Town: How will these new restrictions affect short-term rental operators? Who might be hurt by them?

Moyer: The people that are going to be most hurt are the big businesses, and there are some property management companies that just specialize in Airbnbs. Certainly I talked to a husband and wife team who oversee six to eight properties and all of a sudden their revenue could drop drastically. … For the people who are using this for their main source of income, it’s going to have a significant impact. For people who are just using this as a means to get by, to supplement their income — that sort of remains to be seen. You would hope that they’re not going to be impacted nearly as much.

All that being said, I think for a majority of people — the type of people who rent out their homes on football weekends, when they can get the most money, and Arts Fest, they might not see very many changes at all. But there’s a lot more overview; there will be a lot more enforcement, a lot more implementation. I think no matter where you fall on this issue — whether you’re the one renting or you’re the one renting out — you’re going to feel an impact in some way later, however small, later this fall.

— Sarah Rafacz, State College editor