Big changes are here for non-compliant Airbnbs in the Crescent City. New Orleans City Councilman JP Morrell joined WWL’s Tommy Tucker to discuss the changes in short-term rentals in New Orleans and the consequences for delinquent property owners.
“What changed on August 1st is the requirement that Airbnb has to check whether a permit is valid before listing the property," said Morrell. "Once we did that, there was an almost immediate purge of thousands of illegal Airbnb listings. Because now that Airbnb is responsible and there’s a fine and a threat of de-listing their platform.
"They are the ones now in charge of making sure permits are valid. Once Airbnb has to pay the fines, they’re refusing to list properties that don’t have permits. So, it’s been a pretty dramatic drop-off in the last couple of weeks,” Morrell emphasized.
There are other short-term rental options in the area, but according to Morrell, Airbnb was specifically combative. “VRBO, which is owned by Expedia, has actually been doing the purging themselves for years. Airbnb was the bad actor that made us play whack-a-mole. Now, the playing field is level,” he told WWL’s Tommy Tucker.
“Airbnb hates this law because their goal is to be unregulated and they would prefer to have as many properties listed as possible, whether they’re legal or not,” Morrell stated.
The new city ordinance allows for one Airbnb per square block. If more than one property owner desires to put their property up for a short-term rental on the platform, the city is implementing a lottery system.
The lotteries are held each quarter (four times per year) for those hoping to be part of it. The next lottery for short-term rental availability in New Orleans is on September 29th, with the application period for that lottery falling between September 7th and 13th. For transparency purposes, the lotteries are live-streamed via YouTube, Zoom, or other streaming services and utilize a bingo-style machine to ensure fairness.
Will all of this help when it comes to adding affordable housing in New Orleans? It may take some time to tell, according to Morrell.
“What you’re seeing more and more in the real estate market is a tremendous amount of properties going back on the market because their permits lapsed and they find out they cannot get new ones,” Morrell told Tommy Tucker.
“If you go through the Bywater in particular, the upper 9th Ward, and parts of Mid-City, there’s more property on the market because an out-of-town owner didn’t realize his property’s permit lapsed and there’s no way to get a new one. At that point, they’re just dumping it back on the market,” Morrell added.
“In the short term, it’ll provide some relief, but Airbnb’s are one of about ten problems when it comes to affordable housing here. So, it’s not a silver bullet,” Morrell went on to say.