Some of these establishments are so well conducted that less observant neighbors don’t even realize that they exist. They are in competition with hotels and motels and with bed-and-breakfast lodgings, but short-term rental properties seem to escape the provisions of laws and regulations that other public lodgings must observe.
Would-be renters find these short-term rentals on craigslist or VRBO (Vacation Rental by Owner), as well as via other on-line referrals. Some are offered by owners who briefly vacate their own homesteads during big-time events on the Austin calendar or by owners who have rental space on the real estate where they live in their own homes, which they do not vacate. Some short-term rentals are in residences that failed to sell before the real-estate market weakened.
There are other short-term rentals that have been purchased and outfitted expressly to serve as lodgings for transient visitors. The owners may visit, but they never spend a single night in residence. The lengths of individual rental periods may be brief, but the neighborhood hotel is rarely vacant for even a single night. As advertised, the property’s exterior is seldom displayed, only the indoor amenities and sometimes a photograph of the yard or grounds. Only the neighbor familiar with a property inside and out is likely to recognize one of these hotels so long as the guests are discreet.
Some guests are considerate; others, particularly in the rentals that accommodate large numbers of people, are not. Blocked driveways, U-turns that demolish curbs, parked vehicles that prevent trash carts from being placed in the street on collection day, taxicabs coming and going at all hours of the night, horns honking, doors slamming, shouting by falling-down drunks, the lovely morning sight of towel-wrapped unshaven men escorting women to taxicabs, the sound of multiple barking dogs on blocks where the resident canines are silent, and fast-food packaging and beverage containers strewn about are just some of the delights. There have been perhaps apocryphal reports of door kick-ins and broken windows where befuddled arrivals mistook a neighbor’s house for the “hotel” and gained entry by any means thought to be necessary. The Allendale Reporter was an early describer of the short-term rental phenomenon.
Whether required hotel occupancy taxes are collected and remitted is an open question. It does not appear that governmental authorities have any way of knowing just how many of these establishments exist and where they are located, let alone whether they are evading taxes. The office of the Austin City Auditor has taken a look at this question without deriving firm conclusions. Here’s a link to the summary and a link to the full report issued in February; the formal findings and underlying the reasoning beginning on page 4 are of particular interest.