Columbia has no rules on Airbnbs. As residents raise concerns, is it time to regulate?
For two decades, Bob Norwood has enjoyed a peaceful life in Columbia’s historic Elmwood Park neighborhood. He’s rarely had a bad word to say about his neighbors, except for some rowdy college students here and there.
That changed about six months ago, when one of the houses on his street was turned into an Airbnb rental. The house has become a source of agitation for neighbors, Norwood said — crowds of people, late-night noise, strangers hollering and carrying liquor bottles up and down the street late at night.
“You don’t want people like that running around in the middle of the night in front of your house,” he said. “I don’t think it belongs in a historic neighborhood. I just don’t.”
Short-term rentals like these have become a popular alternative to hotels in recent years. While the industry has grown, so have concerns over how it might affect quality of life and housing affordability in cities nationwide.
As cities and counties across the Palmetto State move to regulate short-term rentals, residents and business owners in Columbia are waiting to see how the capital city will respond to the trend. For local officials, the conversation is just beginning.
From side gig to investment
An ultra-modern loft in Rosewood, a Charleston-style home in Earlewood and a secluded cottage in Forest Acres are just some of the accommodations Columbia-bound travelers can rent through Airbnb.
According to AirDNA, a website that tracks data across several short-term rental services, Columbia had around 675 active listings on Airbnb and VRBO in the first quarter of 2021. That’s up nearly 46% from the first quarter of 2018.
That growth is driven in part by local real estate investors like David and Wendy Bergmann, who say that Airbnb helped them break into the rental industry.
The couple started off by renting out their own home in Cottontown for special events like the 2017 solar eclipse and University of South Carolina football games. Now they own four short-term rentals and manage several others through their business, Heartwood Furnished Homes.
“A lot of people get started this way as hosts,” David Bergmann said. “They kind of just experiment with their own home or a room within their home.”
Morris Lyles, president of South Carolina Realtors, said newcomers and experienced landlords alike are gravitating toward short-term rentals because they can double as an investment property and a part-time home.
“You can stay in them yourself or rent them out while you’re away,” Lyles said.
Whereas long-term rentals often suffer from years of deferred maintenance, the Bergmanns said short-term rentals must be kept in better condition to meet guests’ standards. That upkeep and investment helps add to the overall character of the neighborhood, they said.
“It really doesn’t pay off to invest in high-quality finishes and restore the historic character of a home if you’re just going to rent it to college students,” said David Bergmann. “With short-term rentals, people value those things.”
Long-term ramifications
Some Columbia residents, like Norwood, fear this shifting business model is causing a surge of “absentee landlords” who live outside the neighborhoods where they do business and turn a blind eye to unruly guests.
If an Airbnb owner lives at the property they rent, Norwood said, he’s got no problem. They’re just as invested as he is in the quality of life in the neighborhood, he reasons. There are a number of those types of rentals in his neighborhood and across Columbia.
But, Norwood said, absentee landlords can’t monitor what goes on at their property; it leaves the neighbors to deal with bad behavior, he said.
“You can’t be at Lake Murray and control what goes on here,” Norwood said. “I don’t care how many rules you’ve got. If somebody’s not down here physically to enforce them, it’s no good.”
Some cities, including Charleston, have laws stipulating that short-term rentals can only be operated at owner-occupied properties. Columbia does not have such a law.
Norwood said he worries that a proliferation of short-term rentals in the neighborhood could have a negative effect on property values. Others, though, have voiced concerns that short-term rentals might raise the cost of housing in certain neighborhoods.
“If an owner determines it’s more profitable to use (a property) as an Airbnb, you’ve just lost one of those units,” said Krista Hampton, director of Columbia’s planning department. “Generally speaking, when you decrease housing supply, you’ve increased the cost of housing.”
The State has reached out to Airbnb for comments for this story.
Though short-term rental hosts could create more competition in the real estate market, Lyles said this is nothing new.
“There were already investors in the marketplace long before Airbnb, whether they were looking to flip a house or rent it out with a long-term lease,” he said.
In response to concerns about quality of life, the Bergmanns contend that short-term rentals actually require landlords to be more involved than if they were renting on a yearly basis.
“I wouldn’t call it a passive investment by any means,” Wendy Bergmann said. “You really have to be on-call 24/7 and ready to address any issues that might come up because it affects your reviews.”
Setting new rules
While short-term rentals are not specifically mentioned in Columbia’s city codes, owners of short-term rentals must abide by the same rules as traditional landlords, according to city spokesperson Leshia Utsey.
Landlords must obtain a residential rental permit for each unit prior to renting it out. Those permits can be revoked if a renter or landlord repeatedly violates city codes on the property. The city also charges a higher property tax rate for non-owner-occupied households.
A number of other South Carolina cities and counties have specific regulations for short-term rentals. Charleston, for instance, passed a short-term rental ordinance in 2018 that, among other rules, requires that rental owners live on site and places stipulations on rentals in certain districts. Some places, including Charleston and Bluffton, require short-term rentals to acquire a special permit for a yearly fee. Others, including Mount Pleasant, have a cap on the maximum number of short-term rentals allowed to legally operate.
Even with local laws in place, some places have found short-term rentals can be hard to monitor and regulate. Charleston has scrambled to crack down on hundreds of short-term rentals operating illegally without permits, the Post and Courier has reported.
Several local governments in South Carolina contend that Airbnb and other short-term rental platforms aren’t playing by the rules they agree to abide by. Eight coastal cities and counties — and Columbia — have sued Airbnb, VRBO, HomeAway and 10 other entities they say don’t remit accommodations taxes or pay for business licenses in the state.
While that suit is unfolding, Columbia city leaders are beginning to take a closer look at whether and how to regulate short-term rentals going forward.
City Council member Tameika Isaac Devine said she and at least two other council members have asked city staff to research how other municipalities are regulating short-term rentals and come up with recommendations for Columbia.
“It is on our radar and will likely come up for discussion soon,” she said.
It’s difficult to draw direct comparisons between Columbia and a coastal, tourism-driven city like Charleston, said Hampton, the city planning director. Instead, Columbia might consider how more comparable cities such as Nashville and Austin, Texas, handle short-term rentals, she said.
It’s a topic that certainly should be at the top of the city’s mind right now, Hampton said.
“You don’t want to be on your back foot when this sort of rears its head,” she said. “What you have to do with much of this regulation is involve the community as well. More voices and more perspectives makes for a better process.”
