Maine is renowned as a summer tourism destination. In Portland, my hometown, even the “budget” hotels can cost over $300/night during the peak season. Given the shortage of rooms, and high prices, it’s no surprise that vacationers have looked to other options to shack up.
Enter Airbnb. Founded in 2008, Airbnb is a platform on which a property owner can rent a room, apartment, or home. It has exploded in popularity worldwide, with some estimates of over 5 million listings. One estimate found that in 2017, short-term rentals surged more than 62% statewide in Maine.
Renting your property on Airbnb raises a host of legal issues, touching upon taxation, liability and insurance law, and local municipal regulation. The focus of this article is local municipal regulation.
While Airbnb has benefits for property owners and guests alike, the service has come under criticism. Where housing is in short supply, converting a home to a full-time short-term Airbnb rental essentially removes a home from an already stressed housing market. Opening a home up for rentals could also constitute commercial activity in what would otherwise be a predominantly residential neighborhood. At present, the Maine legislature has not passed legislation regulating Airbnb or similar short-term rental services. A bill proposed in 2015 to require licensing went nowhere.
By default, the issue has become a matter of local concern; cities and towns have filled the void, taking varying approaches.
In Portland, the City Council passed an ordinance that was effective January 1, 2018. Among other requirements, the ordinance requires registration, payment of a fee, and caps the number of rentals.
Last month, South Portland voted to ban non owner-occupied short-term rentals. The rules still allow owner-occupied residences to rent rooms and units on Airbnb, but with a number of restrictions and rules.
Long before Portland and South Portland passed legislation, however, the popular coastal village of Bar Harbor attempted to regulate short-term rentals in 2006. Property owners filed a lawsuit challenging the ordinance as unlawfully curtailing their rights and prevailed in court, leaving the town with a sizeable legal bill. After that experience, Bar Harbor has no immediate plans to regulate Airbnb.
In sum, if you’re thinking about renting a room or apartment unit on Airbnb or a similar site, be sure to seek advice regarding your specific local regulation (if any), and other potential legal issues that could arise.