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Waco takes action to stop proliferation of Air BnBs

Posted at 8:21 PM, Jul 14, 2021
and last updated 2021-07-23 17:26:27-04

Some very old Waco neighborhoods have begun to disappear, with only a few residents on a street.

Who's in all the other houses? Well... that depends on what day it is.

You see, Short-Term rentals, which you might know the brand name "Air BnB" have begun to close in on some long time residents. And the Waco City Council recently took action IT thinks will help.

Not so long ago, a new crop of nice, neat, downtown homes started popping up. They had names like Sterling House, Urban Myrtle, the Story House, and Avenues of Waco. Before anyone really knew what had happened, many more had snuck in without the fancy signage.

Before you knew it, almost every street here had one of these shiny new homes... some had more.

Short Term Rentals, The newest scheme in real estate scheme had arrived, spelling bad news for Ronnie Garrison and his friends.

"What do I think about what short term rentals are doing to the neighborhood? Well, they really put us in a bad situation. Within the next six months, we won't be here at all. I know that for a fact sir. What makes you think that because we're not property owners. We've got this house right here and it's up for sale. In other words, the owners are selling the homes our from under us." explained Ronnie Garrison, a decorated veteran trying to live in a downtown Waco neighborhood, just steps away from the Magnolia Silos.

It became instantly popular for it's proximity to the most popular tourist attraction in town. Real estate investors saw opportunity here and started snapping up old houses to turn them into so-called "Air BnB's".

Some of the early STR's downtown weren't always the best neighbors. One-night renters would fill the streets with traffic and on another, fill the neighborhood with loud music.

Carlotta Hererra has lived on her quiet Waco street since the 1940's.

"What was it like back then? Peaceful," she explained.

After her husband's release from a German POW Camp, they settled down to raise a beautiful family here.

But now, "Oh, everything's changed," she said.

Not only have the children left to pursue their own lives, the neighbors left too....leaving this street eerily quiet many nights.

The sights and sounds of a normal street happen here only sporadically as the new, "temporary" neighbors, come out.

Temporary, because they only live here a few days, a week or two at a time in one of the many BnB' or "short-Term Rentals, within shouting distance.

"They're, you know, they're friendly people here when we have new ones they always say hello," said Mrs. Herrera.

But that's part of the problem, every few days, the "new", new neighbors move in for their temporary stay and so it goes in a never-ending circle. A circle, that some fear, has caused this neighborhood to start circling the drain.

Mrs. Herrera's concerns have or soon will become the concerns of her more distant neighbors, predicts Downtown Neighborhood President Andrew Lopez.

He says the idea behind businesses like AirBnB got its start with families who rented out extra rooms, like the Waco family that turned a den into a spare bedroom for Elvis Presley while he trained at Fort Hood.

"How many of those became something else in my neighborhood here? I would say an average about 20 of them we have actively right now within a three to four block range. How many of those have owner occupants? I don't think any." he said.

A quick run around Central Texas and the Brazos Valley shows, you can't escape the proliferation of BnB's.

The Waco area has perhaps the most, including one that goes for more than a grand a night, and another up the road that goes for more than three times that.

And if you have to ask why the Brazos Valley feels the sting of the BnB's you obviously don't know anything about A&M football, like the median income of the fans, or how they often make a weekend of it with an almost $600 a night short-term rental when the team plays at Kyle Field.

Lopez says his downtown neighborhood has become overrun with short-term rentals.

If you don't think short term rentals have become to crowd some neighborhoods, Mrs. Hererra's house sits in the middle of her block. She has an Air BnB next door, across the street, at the end of the block, and yet another next door.

Yes, she's surrounded by them. and while the constant change they bring leaves Mrs. Hererra always wondering about the new neighbors, studies have shown the businesses contribute to a host of problems, pushing rents higher, as inventory shrinks. The Harvard Business Review studied the problem and found truth in both counts.

If you think of these BnB's as a huge hotels, but with individually managed rooms, sometimes hidden, among buildings which spread out for miles... you can see how The Economic Policy Institute found they often skirt regulations and meant to protect us.

The Institute concluded costs associated with this wild, wild west atmosphere, likely outweigh any benefits the businesses provide.

Perhaps the most damning review of short-term rental's performance came from Hollywood, where Los Angeles County took a close up-of the business in 2015. The study found, in neighborhoods where property owners converted their holdings into short term rentals, it reduced their capacity to house people, by more than ten percent.

That makes the owners as fabulously wealthy as some movie stars, while leaving the county in the hole for unpaid taxes.

The L.A, study even cited the experience of neighbors like San Francisco, New York, and Portland, Oregon which found some of it's laws, governing BnBs's frankly, unenforceable.

"There's room in Waco for both hotels and STRs," said Waco City Councilman Hector Sabido, who with his colleagues in the council initially welcomed BnB's as a way to bridge a gap between the need for hotel rooms and a tight supply. But now, with more hotels preparing to open they've started to tighten their ordinances to close exploited loopholes.

"I think there are some parts of the city where they fit in well, you know, especially in commercial areas they make perfect sense. But there are some other cases where in the neighborhood, you don't want to have a street of five to 10 STR's because now you're messing with the preservation of the neighborhood ," said the Waco city leader.

"We know that there's a housing shortage and I don't know how much of it is driven by short term rentals is it a drop in the bucket or is it a tidal wave? I think that really having clear data that can help navigate this council to make sure we continue to hit that right balance is going to be important," said Waco Mayor, Dillon Meek.

Exactly what concerns Lopez who worries BnB owners may have already found their way around brand-new rules aimed at eliminating absentee owners and mandating on-site owner-managers.

"How to get around it is you put somebody to rent the property. And now you have a renter that's in the property, and what they do is they leave the property and leave it to the guests that are going to be renting it," he explained.

Putting a temporary resident-employee, there to rent to even more temporary visitors. See where he's going?

Waco's onto it. But can the city turn this tide of short term rentals? And does it want to?

Council members say, there's a balance here somewhere. But long term renters say, they've already lost.

"They're not creating urban renewal here, they're creating urban removal," said Lopez.

That's exactly the way Ronnie Garrison and his friends see it.

"They're not crowding the neighborhood sir, the neighborhood is over," said Garrison.

Others say the jury's still out on homeowners... the feeding frenzy over property puts individuals at a disadvantage as they face both prices that rise faster then they can keep up, and taxes which follow closely behind.

For now, Carlotta Hererra, with the help her family who come and go from her home often, keeps vigil on a block that's had its old life drained out of it, and a new one, that changes like a roulette wheel, imposed.

"They change all the time, they'll just change. And then there are times when there's no one," she said.

It's what happens, she says, when a community loses its life, its soul.

What do you call a "neighborhood" without neighbors?

Critics say, BnB owners took this "family block" and replaced it with a revolving door, leaving Mrs. Herrera to wonder which other neighborhood will lose its neighbors next.

"To have a good neighbor that would be great, but I don't know who's next door," said Herrera. "You never know who's next."