Palm Springs Voters Reject Home-Sharing Ban

by Christina Sandefur
June 18, 2018

Good news for property rights in Palm Springs, California—residents of the popular tourist destination overwhelmingly voted down a proposal, Measure C, that would have banned home-sharing in single-family homes. In recent years, the internet has created new economic opportunities by connecting property owners and renters through home-sharing platforms like Airbnb and Homeaway, providing cheaper and better options for travelers and allowing homeowners to earn some extra cash by renting out a room or their home. But not everyone is embracing these opportunities.

The anti-home-sharing group pushing Measure C in Palm Springs believed the city’s existing regulations to be too lenient, claiming the influx of tourists are disrupting neighborhoods and causing noise and traffic problems. Actually, diverting valuable public resources to policing home-sharing and negotiating petty arguments between neighbors instead of enforcing existing anti-nuisance laws may make things worse by fostering “underground” rentals and creating an atmosphere of snooping and suspicion. That’s one reason voters in another California city popular among tourists, San Francisco, rejected a 2015 ballot initiative that would have restricted short-term rentals to seventy-five days a year, regardless of whether the homeowner was present during the rental period, forced homeowners to submit quarterly home-sharing reports to the city, and allowed neighbors to sue people who rent their homes. The following year, San Francisco Mayor Ed Lee vetoed an ordinance that would have capped home-sharing at sixty days a year, because it “risk[ed] driving even more people to illegal rent units.” These restrictions threatened to turn neighbors into spies watching over each other’s back fences to ensure that the guests are just friends rather than home-sharing customers.

Perhaps voters are routinely rejecting anti-home-sharing measures because the costs to taxpayers of enforcing them are astronomical. California taxpayers certainly have experience with that. Another vacation destination that’s cracked down on home-sharing, Santa Monica, estimated taxpayers would pay nearly half a million dollars a year to staff a full-time task force to implement its ban on home-sharing. In fact, it took more than a year for the city to convict its first homeowner: Scott Shatford, a thirteen-year resident, who had listed five properties for rent and had even written a book on home-sharing. There were no accusations that his properties were poorly maintained or that guests had been cheated, but local prosecutors charged him with a crime, fined him $3500, and put him on two years’ probation.

Often, these anti-home-sharing laws are simply façades to protect the hotel industry or to keep visitors away. But while these preferences may guide individual actions, sheltering big businesses from competition and determining who is and is not suitable to stay in a given neighborhood is not the proper function of government.

Instead of targeting responsible homeowners with arbitrary regulations that hinder tourism, limit choice, and violate people’s rights, cities should focus on enforcing their existing nuisance rules. The Goldwater Institute has a plan for how states can do just that, so that cities can protect neighborhoods without undermining people’s freedoms.

Christina Sandefur is the executive vice president at the Goldwater Institute.