Supporting Our Residents Strengthening Our Community Growing Our Economy

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1 The Pasadena HomeSharing Network Supporting Our Residents Strengthening Our Community Growing Our Economy Actual Pasadena Airbnb Hosts: From All Neighborhoods, Backgrounds, and Age Groups The Pasadena HomeSharing Network: A Diverse Group of Long-time Pasadena Residents We are the most active home-sharing hosts via Airbnb: In 2016, The Pasadena HomeSharing Network has 70+ members with 100 listings of the 400+ in Pasadena We are seniors or nearing retirement: More than 50% of our members are over the age of 50; most members are single women over the age of 50 We are not absentee landlords: Pasadena HomeSharing Network is composed of home sharers, not absentee vacation rental landlords We need home sharing income: The majority of Pasadena HomeSharing Network members depend on home sharing income to pay basic expenses We are Pasadena residents not absentee property owners, professional property managers, or real estate developers. We believe in home sharing responsibly to protect the character and tranquility of our neighborhoods. Our members are a cross-section of Pasadena itself from all districts, neighborhoods, ethnic groups, ages, and family situations. We re recent graduates, young families, single parents, empty-nesters, retirees, and widows. We re professionals, artists and musicians, entrepreneurs, between jobs, or tired of looking. We all need extra income to make ends meet. It s not surprising that, with the income disparity between men and women, our group is two-thirds women over the age of 50. We all love living in Pasadena, but we need to find ways to manage the high housing costs. Our home sharing incomes enable us to afford our homes and to be contributing members of our community. We Are Long-term Residents: Most Have Lived in Their Neighborhood More Than 11 years We Are Seniors: Most Are Over 50 We are musicians. The ability to earn money is fast contracting in this current highly exploitative culture and economy for art. We are nearly reaching retirement age, and the share of the field is shrinking for all of us older people. We are highly respected artists and sometimes travel. We share our rental income with neighbors who clean and administer our Airbnb listing for us. We might not have to be on MediCal this year, if we can earn enough through Airbnb. We would have to move out of this area if it were not for Airbnb. Most Are: Artists & Musicians Retired Entrepreneurs or Unemployed Number of Years in Neighborhood Ages of Our Hosts Occupations of Our Hosts Data from survey of Pasadena HomeSharing Network members For further information, please contact the Pasadena HomeSharing Network: pasadenahomesharing@gmail.com

2 Home Sharing Benefits the Pasadena Community and Pasadena Residents Home sharing benefits the home sharing residents by providing much needed income, which not only supports them but also local service providers. Home sharing guests benefit local businesses across the city not just those in tourist destination areas. Many small, neighborhood businesses might not otherwise gain from tourist spending. Home Sharing Supports the Middle Class: Home sharing benefits the economy and neighborhoods because it enables us as hosts ranging from long-term residents on fixed incomes to young families who love our Pasadena communities to afford to live in Pasadena. Home sharing maintains and strengthens neighborhoods by allowing residents across the demographic spectrum to afford to live in Pasadena. Airbnb has enabled me to keep my home and not go into foreclosure. This has enabled me to keep my business because I work from home so I pay my business taxes! I have made some wonderful friends from all over the world. I have helped people relocating to Pasadena to find places to live, get settled, set up bank accounts, and furnish their new homes. I have more friends in the community, and my guests are also more integrated into Pasadena and community life here. Home Sharing Benefits the Pasadena Economy: Home sharing via Airbnb benefits the city-wide economy because guests spend money in neighborhoods all across the city not just tourist zones which supports small businesses and a diverse, vibrant local economy. According to a study conducted by Airbnb, almost half (47%) of the money spent by guests is spent in the neighborhood where they stay. Home sharing supports local jobs; hosts hire local cleaners, plumbers, electricians, handymen, gardeners, etc. Airbnb homes are spread throughout Pasadena Home sharing brings revenue into non-tourist neighborhoods and merchants through guests spending at local businesses. Home Sharing Beautifies Neighborhoods: Competition for bookings motivates Airbnb hosts to keep their homes in good condition and appearance; thus, Airbnb strengthens neighborhood property values and beautifies neighborhoods. For further information, please contact the Pasadena HomeSharing Network: pasadenahomesharing@gmail.com 2

3 Pasadena Home Sharing Is Not Vacation Rentals by Absentee Landlords Home Sharing, Whole House Rentals, Vacation Rentals The Distinctions: Home Sharing Hosts Open Their Own Homes and Properties to Guests Home Sharing as defined in this report is true sharing of one s home or space on the property where one lives the welcoming of guests into one s own home in exchange for monetary payment. Home sharing is not absentee owners renting their properties as full-time, short-term vacation rentals. The more than 70 home sharing hosts in the Pasadena HomeSharing Network all list their properties through the website Airbnb, which fosters trust and security through verification, vetting, and reviews of and by guests and hosts. Airbnb differs from other online rental platforms such as VRBO, HomeAway, FlipKey, etc. Airbnb is not a generic term that refers to all online rentals. Some confusion can occur when looking at the number of listings classified as whole house. Pasadena city staff states in their September, 2016 Memorandum to EDTech that 2/3 of the listings offered in Pasadena are in the whole house category. Concluding that these listings are all vacation rentals is erroneous. The majority of these listing types in Pasadena are granny flats, bungalows or cottages, or duplex units on the property were the host resides, or sections within the resident s home that have separate entrances. In discussing the issue of identifying whole house listings, an Airbnb spokesman stated in an article in the San Francisco Chronicle, July 22, 2016, that some whole house listings are actually master-bedroom suites: There s a mismatch between how the city regulates and how our platform operates, said David Owen, Airbnb s head of policy strategy. There are many folks who advertise a discrete portion of their home as an entire house... This holds true in Pasadena as well. Hosts renting their whole home when they are not present generally rent during times when they themselves are traveling, or, as staff noted, seasonally in conjunction with activities or holidays when the demand for lodging is high the Rose Parade and Rose Bowl games and events are prime examples. Our group encourages our members to have a back-up host available to guests during such rentals. The Airbnb platform now has provisions for adding temporary co-hosts. Looking to other cities examples, San Jose requires that if the host is not present, the host provide a local contact person an idea that could be adopted by Pasadena. Typical Reasons for Whole House Rentals by Pasadena Homeowners When Not Present: Sabbatical: Professors, researchers, clergy, etc. Vacation: Homeowners rent out their properties when they go on vacation Work travel: Projects that require living in a different area for a period not long enough to relocate. Winter Birds, Grandparents: Spend time in other areas for family or personal interests Rose Parade Season: Many Pasadena residents leave and rent out their homes only during this week Personal responsibilities: Need to live in another area for an undetermined period to care for a sick relative or to live with a romantic partner Escrow: Homeowners may elect to rent out their homes to short-term guests until the sales are finalized Only a Small Percentage of Pasadena Residents Home Share; Most Only On a Limited Basis Airbnb Homes Comprise Only.37% of Pasadena Households Airbnb rentals are not a majority or overwhelming percentage of any neighborhood. Most hosts only rent their spaces part-time. Pasadena Demographics 2014: Total Population 154,497 Total Households 61,784 Airbnb Listings 228 Most Pasadena Airbnb home sharing hosts only rent their rooms or property on a part-time basis. Many like the flexibility of keeping space available for visiting family and friends. Others choose to only rent when they travel or during a big event, such as the Rose Parade. According to data provided by Airbnb, the annual average number of nights that Pasadena hosts rent their rooms or property is 49 nights during the 2014 fiscal year. Out of the more than 60 thousand households in Pasadena, in 2014 there were only 228 are Airbnb hosts. While this number has increased to about 400 in 2016, it is still a small percentage of the total population, and listings are spread city-wide, not bunched. Demographic information by Onboard Informatics 3

4 Home Sharing Complements the Hospitality & Tourism Industry Home Sharing Listings Add Room Capacity Pasadena has a hotel shortage, leading to some of the highest occupancy rates in the Los Angeles area. Mike Ross, CEO of Pasadena Center Operating Co., recently told the Pasadena Star News that potential events have been turned away because there weren t enough hotel rooms even with about 2,400 rooms currently available. Trying to find rooms for the California Parks & Recreation Society was tough, he said, [we] didn t have enough rooms within walking distance, so we couldn t have them here. With an average 50% occupancy rate in Pasadena in the approximately 400 short -term rental listings, these complement rather than compete with Pasadena hotels, which have a 85-94% occupancy rate and 2,400 rooms, by providing added capacity for guests on a budget or with specialized needs. Airbnb short -term rentals fill the needs of a different guest market than hotels guests with pets, children, or special food requirements who all need a home-like environment. Home Sharing Accommodations Keep Visitors in Pasadena Eric Duyshart, the city s Economic Development Manager, noted to the Pasadena Star News that weekday hotel bookings particularly Monday through Thursday are usually full with business travelers, stating, If someone is coming in to Pasadena on a Wednesday there s a good chance that they won t find any rooms. So those business travelers might end up going to Glendale, Arcadia or somewhere else. Airbnb helps retain guest stays in Pasadena and keeps guests frequenting Pasadena restaurants and attractions; Airbnb complements the hospitality industry. Many home sharing guests attend conventions, some staying at homes within walking distance and others taking Metro or ARTS buses to the venue. Most are looking for a more economical rate than the $136 per night average hotel rate. Home sharing can supplement hotels and could be included in planning and promotion for events. Home sharing spaces also fill the requirements of visitors who do not need to be adjacent the Convention Center. Home Sharing Is Part of Pasadena s Tourism Solution We hope that Pasadena home sharers can be partners in our city s tourism promotions. Pasadena Home- Sharing Network is a member of the Pasadena Chamber of Commerce and we look forward to partnering with local business further. A portion of the Transient Occupancy Tax collected from hotel guest helps fund the Pasadena Center Operating Company (PCOC) to promote Pasadena. We hope to be included in this promotion to provide awareness of our alternate and much needed accommodations. Pasadena hotels are clustered near the Convention Center and along Colorado Blvd. Most Pasadena home sharing guests do not need to stay near the Convention Center. They are here for the Rose Parade and other events, to visit families/friends, and for work or study at local institutions like CalTech, JPL and the Huntington, Kaplan Learning, and Fuller Seminary. 4

5 Home Sharing Serves a Different, Complementary Customer Base than Hotels Home Sharing Listings Provide Affordable Alternatives to Hotels, Keeping More Visitors in Pasadena: The average room rate among our members for a private room is $80, with some as low as $50. The average rate for a guest house/bungalow is $122. The 17 Pasadena hotels shown on the Pasadena Center Operating Company website average $136 per night ranging from $80 - $270. Airbnb Listings Complement Hotels by Providing Alternatives for Budget Travelers Our Guests Come to Pasadena to Visit Family and for Tourism Home Sharing Listings Provide Affordable Alternatives for Long-stay Guests Who Are Not Served by Hotels: There are less than a dozen corporate apartment complexes (such as Oakwood, ExecuStay, Express Corporate Housing) in Pasadena and all require a one month minimum stay. Generally, their nightly rates are higher than an Airbnb. At Oakwood, nightly rates start at $170. Airbnb rentals serve a different market and budget scholars, student interns, short-term workers, etc., who need more reasonable long-term accommodations. The two main reasons our guests come to Pasadena are to visit families and tourism. Those visiting families want to stay nearby in the same neighborhood. Tourists, particularly foreigners, appreciate the authentic experience of staying in a neighborhood with a local host. The next most common categories of visitors scholars, student interns, and short-term workers often need long stays. Airbnb provides affordable options for these long-stay guests. Top 10 Reasons Our Guests Choose Home Sharing Over Hotels 1. Proximity to family members they are visiting 2. Want kitchen/laundry/larger space than hotel 3. Affordability 4. Prefer to stay in a safe, quiet, peaceful neighborhood 5. Appreciate the personal touch, advice from local hosts; enjoy making friendships with hosts 6. Need space for a pet 7. Proximity to venue: CalTech/Huntington/JPL 8. Enjoy the uniqueness of personal homes 9. Easier when traveling with small children 10. Feel safer in someone s home than alone in a hotel room Data from survey of Pasadena HomeSharing Network members 5

6 Neighborhood Character: Nuisance Complaints, Noise, Traffic, Dangers of Multiple Strangers Often Overstated A s on-site hosts, we are part of our neighborhoods: long-term Pasadena residents. The fact that there is a lack of complaints shows that neighbors concentrating on the demands of their own lives are often not even aware of short-term rental activity. Since home-sharing hosts live on the properties, they are very careful about whom they welcome into their homes and neighborhoods, which is why they screen their guests carefully. An advantage to using Airbnb is the user verification process. Both guest and host must submit government issued IDs, along with their names and photographs. Additionally, the Airbnb website states: [W]e currently check certain databases of public state and county criminal records, as well as state and national sex offender registries on U.S.-based guests and hosts....which checks the user s identity against public records of convictions and sex offender registries.... we may, to the extent permitted by applicable laws and to the extent available, obtain the local version of background or registered sex offender checks. To the extent we do this outside the United States, we will use one of our approved vendors, which checks the user s identity against available local databases....we also check the OFAC list (which includes terrorist designations) for all users that transact on the platform. This level of investigation is more than many landlords complete when renting a property long-term, which is often limited to a credit check. So neighbors can be assured about the visitors Airbnb hosts are welcoming into their homes. We Pasadena home-sharing hosts are just as concerned about our neighborhoods as are our neighbors. In addition to vetting our guests, we make sure that no noise or parking issues arise. Contrary to assertions in the staff report, we do not commonly allow large gatherings or bachelor/bachelorette party groups. Very few listings in Pasadena allow parties or events of any type and most hosts post rules (on the websites and in the physical rentals) prohibiting loud noise and disruptive activities of any sort. We also improve the value of our neighborhoods. Being hosts almost mandates that we maintain our homes so that they will have curb appeal thus we often improve the physical character of the neighborhood, thanks to the income we receive as hosts and the motivation to maintain our listings appeal. Noise Complaints Are Low, Well Handled: Airbnb provides a dedicated hot line for neighbors of Airbnb hosts; excessive complaints can lead to de-listing of a host. Our hosts monitor their guests to prevent partying or loud disturbances. As a last resort, Pasadena Police respond promptly and efficiently handle noise complaints. Noise Complaints Are Mostly in Tourist Areas, Few in Neighborhoods: Pasadena Police responded to 57 Disturbing the Peace complaint calls city-wide from February 2, 2015 August 1, Of these, 9 were for fights; 1 gang activity; 1 unruly group; 1 loud music. Disturbing the Peace complaints are not spread throughout the city as are Airbnb listings. Contrary to some allegations that Airbnb caused disruption in the Linda Vista-Allendale neighborhood, there were only 3 Disturbing the Peace complaint calls in that area. Traffic and Parking a Non-Issue: Our data shows that 87% of Pasadena HomeSharing Network hosts have on-site parking for their guests; the remaining 13% require guests to purchase a parking permit. Since our hosts are distributed throughout the city, there is no mass impact of guests or traffic. No calls registered in area blocked by inset map Data from CrimeMapping.com 6

7 Home Sharing Legal and Unrestricted, While Also Paying a Fair Share The goal of the Pasadena HomeSharing Network is to work with City of Pasadena officials and staff, Airbnb hosts, and Airbnb corporate representatives to become a model of citizen-corporate-municipal cooperation. We are eager to create a legal environment where hosts, guests, and the City of Pasadena all reap the economic benefits of this new technology while preserving the tranquility and character of our neighborhoods. Pasadena s current ordinances provide for home sharing and short-term rentals. The Pasadena Municipal Code specifies a Rental Accommodation Tax of $ annually for those renting three accommodations, and $16.40 for each additional. Those with one or two accommodations are exempt. Since most Pasadena home sharing hosts have only one listing, the majority are not licensed presently and are not required to be licensed. Alternately, the fee for a license for a service business is $ annually, but it is unclear if this license applies to those offering short-term rental accommodations. Licensing is difficult to enforce and voluntary compliance is spotty, as experienced by Portland, Oregon, San Francisco, and other cities. Therefore, we suggest any registration/license/permit implemented in Pasadena be easy. We want to solve problems not cause them while creating sustainable legality for home sharing. We agree that much can be learned from the examples of other cities which have dealt with the issue of shortterm rentals. Nothing can be gained from a regulation that is difficult and expensive to enforce. The approach to short-term rental regulation varies from harsh complex codes to hands-off non-regulation, perhaps because of potential enforcement issues and lack of complaints. Making the licensing/permitting process easy and affordable for hosts will help the success of any regulation. Banning short-term rentals completely hurts all hosts and the city economy. We support having short-term rental guests pay TOT, just as do hotel guests. We suggest this TOT be used toward affordable housing efforts. In California, Airbnb is currently collecting and remitting TOT for cities or counties including: Humboldt County, Santa Cruz County, Tuolumne County, Desert Hot Springs, Indio, La Quinta, Los Angeles, Malibu, Oakland, Palm Desert, Palo Alto, Sacramento, San Diego, San Francisco, San Jose, Santa Clara, Santa Monica, and Sunnyvale. Some form of registration or licensing or permitting is also required. In Pasadena, VRBO, owned by Expedia s HomeAway, offers hosts the option of collecting TOT as part of the booking process. The tax rate the website suggests charging guests is 15% tax when booking homes. However, there is no mechanism to remit this tax to the City. An example of how Airbnb applies TOT to the guest s booking charges in Portland, OR. Airbnb collects and remits the TOT to the city. The hosts do not handle the money. An example of how VRBO applies TOT to the guest s booking charges in Pasadena, CA. The host collects the TOT, but currently there is no procedure to remit to the city. 7

8 Working Together Toward a New Ordinance: The Pasadena HomeSharing Network appreciates our continuing dialogue with City staff and Council regarding revisions to the Pasadena Municipal Code dealing with short-term rentals, home sharing, and vacation rentals. We concur with city staff that: Pasadena should establish a regulatory frame work to legalize and regulate short-term rentals. We note that this framework should recognize that the majority of home sharers depend upon the income they gain from their listing rentals. An overly restrictive regulation would be detrimental and could cause enforcement problems. Any new code should have ease of compliance. Hosts should register with the City. We emphasize that the registration process should be simple and low cost. The registration/license/permit should be automatically renewable if no complaints have been logged against the host. Hosts should collect and remit TOT. We note that ideally TOT should be handled through the online platforms. Where not facilitated by the online platform, the remitting procedure should be simple. We suggest this TOT be used toward affordable housing efforts. Key Points for Consideration for New Ordinance: Home sharing is currently legal, but codes are unclear. Home sharing should continue to be legal and unrestricted for private homeowners within their primary homes or on the property of their primary residences. There should be no limit on the number of hosting days a resident homeowner rents their primary home either rooms or whole houses on their property where they live. Renters with permission from their landlords should also be allowed unlimited home sharing rental days. The number of hosting days for Pasadena residents who live near their short-term rental properties and supervise those properties should also be unlimited. The Pasadena HomeSharing Network is not in favor of absentee landlord vacation rental properties. The Pasadena HomeSharing Network supports a simple and low cost registration/license/permit for home sharing hosts. It should be automatically renewable if no complaints have been logged against the host. The Pasadena HomeSharing Network supports paying TOT. We favor the TOT being used for affordable housing. Regulations (including any inspection process) need to be simple, have ease of compliance, and not be more costly to enforce than any financial benefits gained from any TOT. Since all residential property undergoes an occupancy inspection, additional inspections should only be necessary if multiple complaints are made against the individual host. Reasonable and Enforceable Regulations Are the Solution: We suggest that Pasadena implement a registration/licensing/permitting process that is easy and affordable for hosts. While some home sharers depend solely on their hosting incomes, other hosts also have jobs other than hosting, therefore, the ability to register through an online portal would be ideal. No limit should be placed on the number of hosting days when the host is present or the primary residence is being rented short-term. The collection and remittance of TOT can easily be done through the online listing platforms. Airbnb in particular handles all funds on behalf of hosts and guests, and seamlessly collects and remits the TOT funds. The paperwork for hosts using other platforms needs to be easy to complete and submit perhaps a form sent (or ed with easy electronic return option) quarterly, similar to the EZ sales tax remittance for the State Board of Equalization. We welcome the opportunity to work with the City on educational campaigns: to inform the general public and host residents about short-term rentals, the benefits of short-term rentals to the Pasadena economy, how to be a good host and neighbor, actions for a neighbor to take if he/she feels impacted by a short-term rental, and how hosts can comply with short-term rental regulations. As the City begins the process of public meetings and commentary, we welcome the opportunity to present information and our personal perspectives, and to share the experiences we ve had with our myriad guests from around the world, around the nation, and even Pasadena residents needing accommodations for family and friends. 8