Caldara: Denver’s Airbnb rules intolerant to property rights, freedom of association

September 11, 2019 By Jon Caldara

Living in Boulder as long as I have means I’ve lived near a few college party houses. You can always tell them — burned-out lawn, ping pong table outside for beer pong, a couch on the front porch, blaring music.
When I see one, I have two contradictory thoughts: What an eyesore, and why can’t I live there?
Living next to loud neighbors isn’t much fun. So, it is easy to understand the frustration some have living next to an Airbnb rental.
Most short-term rental guests are just fine until they rent a house or condo for a weekend bachelor party or a marathon session of “cannabis tourism.”
But the City of Denver’s little jihad against fledgling entrepreneurs, like those who do short-term rentals of their property, isn’t about noisy guests. It’s about control, limiting choice and stopping free association.
Let’s dispense with the loud-neighbor argument. Whether a commotion is coming from a college student who rents long-term, a stoned tourist renting short-term or a 75-year-old outdoor bagpipe enthusiast, we have laws against disturbing the peace.
Yes, those laws can be hard to enforce against an out-of-town guest who leaves in the morning. But penalties can build up against the homeowner until she is more selective about her guests.
Before we take away property rights let’s enforce the laws we already have. (Wonder where we’ve heard that before?)
What’s behind the anti-Airbnb movement is an intolerance to other people using their property rights and freedom of association to rent out their home at all.
So much for your home being your castle.
The first unnatural hurdle Denver fashioned is a license just to invite a guest into your own home. Fortunately, most cities don’t do this.
If you rent your home for a span of over 30 days in Denver, you don’t need a license. Do it for 29 days, you do.
In Denver, should your houseguest thank you by taking you out to a $100 dinner, no license needed. A guest thanks you with $100 cash, you’ll need a license or else you’re a criminal for deciding who your own guest is and the relationship you have.
Licensing, especially in the Airbnb world, is certainly not for the protection of the renter. User feedback is the key technology in short-term rentals. A renter knows a lot more about the Airbnb place he is considering, and the person he’s renting it from, than he does when he’s looking to rent an apartment for an entire year.
Airbnb renters leave feedback constantly which is crucial in tempting future renters. The more renters, unlike long-term rentals, the more feedback and the clearer the picture. Places with bad reviews don’t rent for long.
As reported by Colorado Politics, the city is now criminally charging homeowners for renting out their own property. So far, some 154 people have forfeited their short-term rental licenses for fear of becoming a felon.
They no longer can have the relationships they want, use their own property as they wish or make the income they need.
I’m unaware of any other city being so totalitarian.
What’s their hideous crime? They don’t live full time in the place they are trying to rent out. It is not their primary residence.
The city’s logic is if you are forbidden to “Airbnb” your place short-term, you’ll, of course, rent it out long-term, somehow making housing more affordable.
Maybe. But a long-term rental may be just as expensive. Or people might not rent out their non-primary place at all. The owner won’t make as much money, and not pay as much in taxes. It will also make it harder for out-of-towners to find an affordable place in Denver where they will visit and spend money.
Choking off entrepreneurship this way is one of the many little dominoes that can lead to a city’s economic downturn. And give the city its due, cities in recession do have affordable rents.
Of course, booming Denver could never see such a downturn, as they said about Detroit in its heyday.
Remember the classic movie Doctor Zhivago? The communists split up the doctor’s house, without any due process or compensation for loss, to provide housing for others. The only difference between that and what the city is doing to Denver property owners is that of magnitude.