Austin council sets end date for "Mini-Hotels"

The Austin City Council closed the door on neighborhood "short term rental" properties -- that act like mini hotels.

The decision came after council members spent most of the day trying to decide when the practice will officially be outlawed.

The Austin City Council chamber was packed Tuesday with people from both sides of the short term rental fight. The issue came up because of complaints from neighborhood residents about loud parties by renters who were in town to attend a festival or some other special event.

Councilman Don Zimmerman suggested they may be taking the wrong approach in addressing the concerns

"I think this whole problem came about because we had public disturbance ordinances that were not being enforced and I want to draw the council’s attention back to that,” said Zimmerman.

The main focus is on people who don't use the property as homes but as an investment - it's a category known as type 2 short term rental.  There are currently about 430 sites, that number was capped last year. Council member Kathie Tovo made it clear the discussion for her and others has evolved into something bigger than cracking down on noisy visitors

"We talked a lot about affordability and what policies promote affordability and which don't I think it is an increasing body of evidence that's coming out here and I am sitting in that commercial short-term rentals in our neighborhoods in removing long-term rental stock and removing housing stock increases house costs for those who want to live and rent and in our ... neighborhoods,” said Tovo.

It was decided that Type 2 Short Term Rental property will be phased out by 2022. Mayor Steve Adler warned shutting down type 2 rental property could trigger lawsuits and also drive the industry underground.

Rental units, known as Type 1, which are located on property that the owner also lives on, are still allowed.  Occupancy limits and noise controls for Type 1 rentals were set by the council.

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