Nuisance or investment opportunity? Towns struggle to handle growth of short-term rentals

Short-term rentals have surged in popularity in recent years, providing more options for tourists They’ve also grown into a sizeable investment opportunity But, as the market for these properties has boomed, so too have concerns about their prevalence and impact on the community.

An economic opportunity

Greenwood Lake, NY, was one of the first communities to implement short-term rental regulations. The area has been a second-home community for a long time and was a natural fit for Airbnb, noted Lisa Mulcahy, a Greenwood Lake resident who manages properties in Greenwood Lake as well as Warwick, NY, and the NJ towns of West Milford and Highland Lakes.

Mulcahy believes short-term rentals benefit the local economy and provide places for visitors in an area where such traditional options as hotels are limited or non-existent. At the same time, she feels that regulations are needed, and communities need to avoid letting investment companies buy up all the property.

“The most important thing is to have local property management, a boots-on-the-ground person who is responsible for the property,” said Mulcahy. “This puts people’s minds at ease. Available owners means that if anything is not okay, someone can be reached immediately. We want it to work for our community and neighbors.”

In other areas of Orange County, where popular destinations draw thousands of visitors every year, residents recognize the desirability of alternative places to stay.

Davida Kossar, who lives in Goshen, NY, with her husband and two kids, believes owners should have control over how their properties are used.

“Homeowners should be able to rent out their properties as they wish.” said Kossar. “With Legoland so close, it’s a great option.”

Bad neighbors versus good

Other area residents feel the increased concern over the safety and welfare of residents — particularly children — outweighs any benefits of increased tourism with more short-term rentals.

Genaro Velez moved to Warwick with his wife and two children to find a more rural life out of the city. More than a year ago, a nearby property was sold and turned into a short-term rental.

Since then, Velez claims that the guests on the property have caused a lot of problems. In six months the house has had eight violations, he said and the owner, who he referred to as an “absentee landlord” only responds if there is a complaint. He believes that the town of Warwick is unable to keep up with the short-term rental issues.

Velez is concerned about the number of strangers coming in and out. He wants background checks that are more thorough for renters, especially for things that could potentially endanger children.

“They don’t check who’s coming in. I understand it can be good for the town, but I am concerned about safety first and foremost.”

William Lemanski, a resident of Tuxedo, NY, shares Velez’ concerns about how short-term rentals impact the welfare of the local community.

“Approvals of short-term rentals will place them in close proximity of the Tuxedo school district, with unknown transients near school children,” Lemanski said during the public comment session of a Tuxedo town board meeting last September.

Another Tuxedo resident, Kristy Apostolides, also shared her views on short-term rentals at the meeting, explaining that her experience with the property next door had been mostly positive. But she still supported Tuxedo’s efforts to rescind their draft of proposed short-term rental legislation.

“It was still bizarre not knowing who was staying next door to you on any random given weekend,” said Apostolides. “Even in this best-case scenario, it was uncomfortable, and I didn’t like the fact that I was uncomfortable in my own house. I understand the reasoning why people have Airbnbs. I have stayed at Airbnbs myself. But now I am reconsidering it having experienced what it is like to live next door to one.”

Lakeside communities in Sussex County, NJ, have also seen a spike in short term rentals. Glen Kamp, a resident of Highland Lakes for 13 years, recalled the moment he knew unchecked short-term rental growth was going to be a problem for his neighborhood.

Five years ago Kamp noticed a larger-than-normal amount of garbage in the lake near his property. He tracked the trash to its source, a short-term rental. While Kamp acknowledges that even residents can be disrespectful, he points out that visitors are not thinking about the well-being of the community.

“When you’re renting a place, you are usually celebrating something. There are parties on the lake that are too loud,” said Kamp.

Kamp, who claims he helped lead the charge to tighten up the short-term rental rules in Highland Lakes, said he is happy with the board’s efforts to keep things under control. He also acknowledged the efforts of the security force in monitoring any issues that may arise.

Still, Kamp wishes more would be done. For example, he would like the Highland Lakes rental cap to be reduced from 180 days to 90 days.

Carsten Jorgensen of Upper Greenwood Lake, NJ, shared similar frustrations with short-term rentals. In the summer of 2023, the house next door to him was sold and turned into an Airbnb.

“It was rented out on weekends and used as a party house,” said Jorgensen. “There was loud music late into the night.”

Jorgensen said that he brought these issues up with the owner to no avail. In the end the short-term rental was short-lived as the property was sold after 10 months and no longer operates as an Airbnb, according to Jorgensen.

Such issues have inspired Sparta, NJ, Councilwoman Christine Quinn to take up the issue. “I am of the opinion that there are numerous concerns, risks and pain points associated with short term rentals that need to be addressed, including but not limited to the safety and security of our residents as well as potential and severe impacts to our housing market/inventory and structure (around the trend of businesses buying up real estate in places where short term rentals are popular and permitted),” she said.

Robert Weaver, of Hamburg, NJ, a longtime resident of Sussex County, is more supportive of short-term rentals and welcomes travelers who want to come and enjoy the community. But he thinks more can be done to ensure renters respect the rules. He believes background checks and increasing the minimum age for renters to 26 would improve things.

Weaver he said while he understands the investment potential of short-term rentals, he is worried about their impact on the community.

“My concern is if more properties turn into Airbnb properties, it could make rents/mortgages rise in price in our community due to lack of availability. I want more local families to be able to afford and buy into our neighborhoods. I want there to be a sense of community and stability... If we have too many transient people coming into our neighborhoods that could disrupt the balance,” said Weaver.

Regulation frustration

Jodi Santengelo of the town of Warwick has been operating an Airbnb in the village of Warwick for three years. She appreciates the opportunity to earn an income from the property and enjoys the flexibility of not having to be a full-time landlord.

Santengelo says she has not had any complaints about her short-term rental and rejects policies designed to deter investment in these properties.

“People who come to Airbnbs are the ones spending.” said Santengelo. “Short-term rentals allow people to utilize our resources. We are bringing in more tourism, otherwise people have to stay outside of Warwick.

When Scott Burnham, of Hewitt, NJ, purchased a house three years ago on Lake Wallenpaupack in Pike County he hoped to capitalize on tourism in the area.

Burnham said he experienced a few problems in the beginning as he learned how to best manage the property, including which renters to deny. Within three months, his property was booked for the whole summer.

As time went on, the township added more regulations for short-term rentals. The extra fees related to inspections and septic maintenance were challenging. But the main problem was the requirement that the owner of a short-term rental in the township must live within 30 miles of the property or hire a property manager who does.

Unable to find someone local to manage the property, Burnham sold the property last April.

“I would like to do it again, but I don’t know if it is going to happen,” said Burnham. “I got regulated out of business.”