Rouge Rentals

While Airbnb is legal and regulated in Pacific Grove, residents who list rooms in Monterey could face a $1,000 fine.

A simple search for Airbnb accommodations in Monterey brings up a dozen options throughout the city, from New Monterey and downtown, to the Alta Vista and North Fremont neighborhoods. Last year, city staff found a total of 200 listings for short-term rentals, with prices ranging anywhere from $89 to $200 a night.

If these rentals were to become legal, residents would have to pass a ballot measure to amend the city’s charter.

With the city struggling to provide affordable housing, many see Airbnb negatively affecting the rental market, while others say they would not be able to afford to live in Monterey without it.

“I’m not in favor of Airbnb,” says Monterey Mayor Clyde Roberson. “We have such a small amount of single-family homes, we have a small amount of rental units, short-term rentals only take units off the market. It’s not good for affordable housing.”

While most residents currently supplementing their income with Airbnb are reluctant to talk about their activity, those who are seem to gush over the service.

“They are a wonderful company that allows me to stay in my home,” Lisa, who declined to give her last name, says in a message exchange on Airbnb. She uses the service to rent out a room in her home adjacent to the Presidio. “I’m divorced and on my own at 60 and this pays my mortgage.”

When the City Council voted to approve the Housing Element of the city’s General Plan during a special meeting on March 16, they also directed staff to explore options for monitoring Airbnb and other short-term rentals to determine the impact on the housing market, as well as to find different ways to enforce the prohibition. The council will receive a report on the issue by the end of the year.

The ban on short-term rentals stems from a successful ballot measure in the 1980s to limit the growth of hotels and motels throughout the city.

“No one even thought of something like Airbnb at the time,” Roberson says.

Monterey’s only mechanism for enforcing its ban on short-term rentals is by responding to complaints. When the city is first notified a person is using a service like Airbnb to rent out a room, city officials issue a notice informing them that short-term rentals are prohibited in the city. If the notice is ignored, the city could issue a $1,000 fine.

Over the past few years, dozens of notices have been issued to suspected violators, with only one fine handed out to a repeat offender.

“Some people still see a financial benefit to using Airbnb even with the threat of fines,” concedes Kimberly Cole, the city’s managing principal planner.

During public comment at the City Council meeting last month, nearly a dozen people spoke in favor of short-term rentals, some saying transient occupancy taxes levied on them could be used to directly fund affordable housing. But half of voting residents would have to approve a ballot measure to legalize and regulate short-term rentals, and two-thirds would have to approve specifically allocating funds to affordable housing.

“Because it’s in the charter, it will be an arduous process to change anything,” Cole says.

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