El Paso Puts Off Regulating Airbnb, Vrbo Rentals for Now

El Paso officials recently decided against imposing regulations on short-term rental properties listed on platforms like Airbnb and Vrbo. Instead, the city will collect complaints about the rentals through its 311 system for one year before revisiting potential regulations.

The decision came as a relief to many rental owners and operators in El Paso, who mobilized against proposed regulations earlier this year. However, one city council member still aims to impose limits on the density of rentals in neighborhoods and require them to pay hotel occupancy taxes.

No Regulations, For Now

In August 2022, the El Paso City Council approved a pilot program to gather data on short-term rental complaints for a year using the city's 311 phone and online intake system. After the year is up, city staff will recommend to the council whether regulations are needed.

The decision avoids strict regulations enacted in other cities like New York, where thousands of listings were dropped from Airbnb after new rental rules were enacted in 2022 and enforcement began in October 2023. El Paso officials indicated they wanted to take a more balanced approach between neighborhood concerns and the business interests of rental owners.

The pilot program was seen as a compromise by some city leaders reluctant to regulate the industry. El Paso conducted extensive public outreach in 2022, finding little support for enacting regulations. A survey found 75% of respondents were against implementing rules for short-term rentals.

Seeking Limits on Rentals

However, City Council member Chris Canales believes some regulations are still needed. Canales wants to limit the density of short-term rentals in specific neighborhoods through minimum distance requirements between properties. This would preserve housing for full-time residents, he argues.

Canales also proposes requiring short-term rentals to pay El Paso's 9% hotel occupancy tax. Currently, they pay only the 6% state hotel tax. Operators counter they already pay city property taxes.

An alliance of short-term rental owners and operators hopes to self-police bad actors during the pilot program year. They aim to work with Airbnb and Vrbo to remove any listings generating repeated complaints, like those stemming from house parties. Both rental platforms have blanket party bans in place.

Catering to Military Families

Industry experts say much of El Paso's short-term rental market caters to military families at the nearby Fort Bliss Army post. Rentals provide temporary housing for newly transferred soldiers as well as visiting relatives.

The number of El Paso short-term rental listings has held steady at around 1,600 properties after surging in 2019, according to AirDNA data. Growth is expected to remain modest, as most operators own just one or two properties. There's little appetite for corporations to buy up homes for short-term rentals at a large scale in the market.

The yearlong complaints collection program will shed more light on problem properties in El Paso neighborhoods. But for now, new regulations are off the table as city officials take a wait-and-see approach to balancing community concerns with the interests of small business owners providing short-term lodging.