The short-term rental bill and the in-fill housing bill
It is abundantly clear that the legislature did not think these bills through carefully when they drafted them. They certainly didn’t think about the consequences of these two bills. There is an old adage with legislation, you get what you incentivize. These bills incentivize out of state investors, they incentivize the tear down of existing homes to make way for mini hotels and they incentivize a race to the bottom for rental pricing when cities become saturated with short term or long-term rentals. These two bills are complementary to one another in that they benefit out-of-state investors and builders/developers, but they don’t benefit locals.
Out-of-State Investors Over Local Homeowners
When local cities have no real ability to regulate short-term rentals or in-fill housing, it creates an immediate attraction for out-of-state investors. Areas like Coeur d’Alene have a lot of tourists that visit regularly. This is a prime opportunity for out-of-state investors. They are able to bring in large quantities of capital and outbid locals. Who benefits when a market is created for out-of-state investors, developers, and deep pocket local investors: builders and property management companies. Who doesn’t benefit, locals who need starter homes. The very people that Senator Toews claims he wants to help.
The Rise of Neighborhood "Mini-Hotels"
Out-of-state investors will seek to maximize the profits that they can make with short-term rentals. They will do this by building the maximum development they can. This might mean large buildings, or it may mean multiple smaller buildings per lot because the city can no longer regulate the number of short-term rentals on a particular property.
By preventing the city from requiring permits, HB583 limits the ability of cities to enforce code requirements allowed by the bill. Code requirements with no enforcement mechanism encourages short-term rental owners to skip them all together.
Combine this with Senate Bill 1352 and the legislature has created a massive incentive for out-of-state investors to buy up all of the starter homes and either use them for regular rentals or short-term rentals. Again, who benefits from this: builders and property management companies. Who doesn’t benefit from this, locals who need starter homes.
Saturated Housing Markets and the Race to the Bottom
Once the market is saturated, the laws of supply and demand dictate that this will quickly become a race to the bottom for price. Out of state investors will either cut corners, or abandon homes when they become unprofitable. As this occurs, blighted neighborhoods will be created. None of this will be good for the local residents.
In addition to the consequences mentioned above, the additional strain on local infrastructure will be significant. Traffic in and out of these neighborhoods will back up at choke points in both the morning and evening. Our already strained water and sewer resources will be further reduced.
The Urgent Need to Restore Local Control
The short-term rental bill combined with the infill housing bill will be a one-two gut punch to locals. All of the work that local municipalities along with hundreds of residents have put into controlling and managing growth will be thrown out with the combination of these two bills.
Why did the legislature create such bills that enforce top-down edicts that benefit out-of-state investors instead of local residents? Why did legislators who claim to be Christian and conservatives, think so little of the people they claim to represent? California, Colorado and Washington have all implemented similar housing bills. Perhaps the legislature should have looked at the crime maps of these infill housing communities before proposing them in Idaho.
We must return to local control. We must cap predatory out-of-state investors. We must think through and plan for the obvious logical consequences of the bills that are proposed. These bills are a betrayal of trust to the voters from legislators who should know better.
Final Thoughts
If we criticize the leftist politicians in Washington, California and Colorado for creating bills that mirror SB1352 and HB583, shouldn’t we hold accountable the politicians who authored and voted for SB1352 and HB583? Absolutely!
