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Hey Airbnb.."get out of my town"...New Buffalo gives them the boot!

New Buffalo cuts off new Airbnb-style rentals

Officials in the tourist town on the Lake Michigan coastline voted Monday to stop issuing any new permits for short-term rentals in residential districts, which make up the great majority of the 2.5-square-mile municipality.

by DENNIS RODKIN, Crains Chicago

The City Council in New Buffalo voted Monday to prohibit new short-term rentals in most of the town, the culmination of an often tense struggle over Airbnb-style rentals in the southwestern Michigan getaway capital.

The three council members who were present voted unanimously to adopt an ordinance that will ban permits for new short-term rentals in areas zoned for residential use, which make up the great majority of the 2.5-square-mile town. New permits will be allowed only in areas that are zoned for commercial use but contain dwelling units.


Second-home towns tangle with short-term rentals

The ordinance will “provide some equity to the people who live here,” Mayor John Humphrey said at the meeting, “that we won’t be living with an unfathomable amount of people.”

Short-term rentals, offered through Airbnb, VRBO and similar websites, have been proliferating for years in New Buffalo, a town of about 1,700 full-time residents 70 miles from downtown Chicago. City officials estimate there are about 200 now, both those operating with city permits issued before a moratorium went into effect in May 2020, and those operating without permits.

Humphrey, who was elected in 2020 in part because of his outspoken opposition to short-term rentals, said at Monday’s meeting that short-term rentals now constitute about 1 of every 11 homes in town.

“There is a saturation level,” Humphrey said. He and others have complained about short-term renters bringing noise, litter and a lack of neighborly respect. They also contend home prices have risen fast because of buyers counting on the cashflow, which pushes affordability out of reach for full-time homeowners.

At Monday’s meeting, several owners of second homes urged the city council to reject the ordinance. (A Crain’s reporter attended virtually, via Zoom, so many of their comments and full names were difficult to capture.)

A speaker named Adam said the proposed ordinance was “a blunt instrument” that is not backed up by data but by anecdotal evidence from some full-time residents who have interacted with the “bad actor” short-term renters who misbehave.

Diane, who said she and her husband have offered short-term rentals in their New Buffalo home for 15 years, said it has been “without incident.”

Over those years, Diane said, “we have shared our home with many lovely families.”

In 2019, before he was mayor of the town, Humphrey spoke at a city council meeting about what he considered the harmful impact of short-term rentals on his New Buffalo neighborhood. “High-occupancy short term rentals are a threat to local residents’ quality of life, safety and security,” Humphrey said then. He said that at a single short-term rental across the street from his home, one weekend there were 13 cars parked, including on his lawn.

The support for cutting off new permits, Adam said, appears to be based on the notion that “this tourist town is going to be better off without tourists. None of that makes any sense.”

Jim Kramer, who said he owns a retail business in town, told the city council that by stopping the growth of short-term rentals, “what you are doing is a public relations nightmare” for a town whose largest industry is tourism.

Other New Buffalo residents voiced their support for halting the spread of short-term rentals. Ron Watson said that on his street, eight homes have short-term rental permits, and they are capable of hosting ten people each.

“That’s too high a density,” Watson said. “Fifteen years ago, I had peace and quiet. I don’t have it today.”

Over the past few years as New Buffalo has had its moratorium on new permits and appeared likely to stop them permanently, opponents have said it’s an infringement on their property rights.

At Monday’s meeting, a second-home owner named Kristin said she bought a New Buffalo property in 2020 “with the intention of being able to rent it.” During the moratorium on new permits, she said, she made improvements on the home. The ordinance, she said would permanently remove the possibility of generating income with the home.

That, Kristin said, would be “inequitable.”

Humphrey dismissed the idea that the ordinance denies homeowners their property rights. “When you buy a home in a municipality, you are entering a social contract,” he said. “You are bound by the rules and regulations of that municipality.”

New Buffalo’s old zoning rules, which were written before the era of Airbnb-style short-term rentals, do not meet today’s demands, Humphrey said. “What we can’t do is just allow things to go on as they have,” he said.

The ordinance includes a requirement that city officials evaluate its impact by November 1, 2022, and determine whether it should be amended.

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