Adam Gaudet is 2022 president of the New Hampshire Association of Realtors.
It is a relatively rare occurrence when Democrats and Republicans agree on legislation at the State House these days. It’s worth noting, then, that in a near-unanimous State Senate vote last month, both parties supported SB 249, designed to prevent municipalities from outright banning residential one and two-family buildings from being used for short-term rentals, while simultaneously expanding a municipality’s regulatory authority.
Of course, not everyone is on board, but even a group of town officials who recently wrote to legislators expressing their concerns with SB 249 acknowledged that short-term rentals, “rarely creates a problem for anyone.”
We could not agree more. The vast majority of short-term rental visitors and operators rarely create problems for municipalities or neighbors. Sure, there will always be a few bad apples, but towns should not react to that minority by prohibiting everyone’s ability to use a short-term rental and thereby stifle New Hampshire’s tourism economy and cost the state tens of millions in tax revenue.
Recently, a Superior Court judge overturned Conway’s ban on short-term rentals, indicating that the activity was a protected residential use of the property. Just as importantly, the judge practically begged the state legislature to step in to the debate, writing, “It is a question that cries out for legislative direction, based on statewide policies promoting commerce, competition, regulatory control, and municipal oversight.”
Although we believe that the judge’s decision was decisive and clear, the Town has chosen to challenge it. But regardless of that outcome, we understand that many residents have legitimate concerns about disorderly properties, and towns should be granted additional power to go after the few operators of short-term rentals who are causing problems. And that is exactly what SB 249 does.
The bill is effectively a compromise proposal, balancing the private property rights of owners with a town’s right to ensure the safety and quality of life of its residents and visitors. In fact, it grants municipalities new authority to require a registration process while also allowing towns to inspect the property for certain minimum health and safety requirements. Neither is currently allowable under the current state statute.
Further, if a property is a repeat offender, the town is authorized to rescind that registration. Senators agreed that is a more effective approach than unenforceable bans.
The legislation also makes clear that municipalities retain all existing authority to regulate noise, parking, health, sanitation, and other any other town regulations. The bill only covers one and two-family structures, enabling towns to enact ordinances prohibiting rentals in multi-family or non-residential structures.
In short, for those property owners who have legitimate grievances against neighbors, SB 249 provides the additional tools to help. In fact, it may be their only chance to ensure a disorderly property complies with town regulations.
It is worth noting that the issue has enormous economic implications, with the state budget relying on about $40 million in meals and rooms tax revenue directly from short-term rentals, tax dollars of which many towns wanting to ban short-term rentals are demanding a greater share.
A few opponents have claimed that residences being used as short-term rentals have exacerbated the housing crunch. However, those claims do not hold up under scrutiny. Portsmouth, for example, has about 120 short-term rentals out of a housing stock of 10,000 units. That is less than one-tenth of a percent. And fewer than a dozen of those short-term rentals were rented out for more than nine months last year.
While the vast majority of short-term rentals are vacation homes and will never be part of the long-term inventory, lost in the debate about affordability is the fact that many of these property owners depend on the revenue from renting their properties to pay their mortgage, property taxes or their children’s college education. Removing their ability to rent could, in fact, force them out of their primary residences.
We recognize that some local officials are opposed to the bill simply on principle. Their position is that under no circumstances should the state government dictate to a municipality what a town can and cannot do. They feel local control takes precedent over private property rights.
However, New Hampshire is not made up of 235 independent sovereign city-states. When towns impede a property owner’s fundamental right to acquire, use, sell, and yes, rent their own private property freely, the state needs to protect that individual.
Regulations work. Bans don’t. We hope state representatives from across New Hampshire will support the reasonable compromise that is SB 249.