City of Seattle Imposes New Short-Term Rental Limits

On December 11, 2017, the Seattle City Council voted 7-0 to enact new regulations for short-term rentals.  The new regulations will take effect on January 1, 2019, and will require all operators of short-term rentals (including those offered on sites such as Airbnb and HomeAway) to obtain licenses and will limit new operators to listing their primary residence and one additional unit.  Existing operators across much of the City of Seattle will be limited to renting two units (this is increased to three units if the operator later adds his or her primary residence).

Only existing operators in small buildings constructed after 2012 on First Hill and Capitol Hill and existing operators in the downtown core will be allowed to continue to list as many units as they do now, plus their primary residence and one additional unit.  The City Council stated these limits were implemented to rein in a rapidly expanding industry that caters to tourists looking for less expensive alternatives to hotels thereby taking large numbers of units off the housing market and converting neighborhood apartment buildings into de facto hotels.

The City Council also recently enacted an ordinance to take effect in 2019 that provides for a tax on short-term rentals of $14 per night for an entire home and $8 a night for individual rooms. A portion of the tax revenue will be used to support community-initiated development projects and to create affordable housing.

If you have questions regarding short-term rentals in the City of Seattle, please contact Josh Pope or one of the attorneys in MPBA’s Real Estate Department.

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