Questions about what happens when short-term rental properties in Asheville-Buncombe County are classified as commercial real estate will be part of the October 18 presentation to the Commission.
This is due to conversations that have been going on in the county for some time, but following a presentation by the Ad Hoc Reassessment Board, a group that presented the commissioner with about nine months of research and recommendations on July 19. It was brought to the front.
Two of those recommendations suggested that Buncombe seriously consider how it approaches short-term rentals. Short-term rentals currently exist under very limited regulation when within county boundaries. This is in stark contrast to Asheville city regulations, which since 2018 have prohibited a resident from renting out her entire home for less than 30 days. As Citizen Times previously reported, the city allows homestays.
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Their ad hoc reassessment committee recommendations state:
- “Distinguish the valuation approach for short-term rental, investment, and/or secondary housing from the valuation approach for single-family homes used as primary dwellings.”
- “Allocate short-term rental income to fund Health and Human Services Homeowner Grants.”
These were designated as ‘long-term’ goals in the recommendations.
Tax accountant Keith Miller told the Citizen Times on Sept. 28 that he plans to discuss these and other topics at the Oct. 18 board meeting.
“I expect to hear more about questions from ad hoc (re-evaluation) committees on short-term rentals when I do my presentation for commissioners,” he said. “And I’ll talk with the commissioner some more about where we are and make some suggestions on how we can move forward.”
County is open to commercial classification
A potential change to how Buncombe handles short-term rentals may be far off, but it weighs heavily on the minds of leaders trying to reconcile the county’s tourism culture with its need for affordable housing. increase.
One of them was Board Chairman Brownie Newman, who wrote an email following up on some of the recommendations the Ad Hoc Committee considered on September 1st.
After the July 19 presentation, Newman spoke with Miller about short-term rentals and how the county can take a more active role in dealing with the surge in rural areas.
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“Keith appears to be basically open to classifying these properties as commercial/income properties rather than residential,” Newman said in a Sept. 1 email, adding that Ash It was sent to several commissioners along with members of the Bill-based economic research firm Urban3.
Urban3’s Ori Baber and Joe Minicozzi surveyed county commissioners and administrators in early 2021 to detail potential inequities in Buncombe’s property valuation process.
As The Citizen Times previously reported, during the ad hoc reassessment board process, Miller and Urban 3 told members that an estimated $96 million in unreported home improvements in 2021 would cost Buncombe County approximately He said he may have missed $450,000 in tax revenue.
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Newman said in an email that he and Miller did the math in a fictional house converted into a vacation rental that brings in thousands of dollars each year. In one approach, the property’s tax valuation may change due to the income generated by short-term rental income. That would pay the county more, but not much, Newman reasoned in an email.
“Keith said the biggest challenge down this road is that Airbnb, Vrbo and similar platforms don’t disclose exactly where properties are located, only the general location. said.
According to data published by AirDNA.co, which tracks short-term rentals, there are currently hundreds of rentals in Buncombe’s unincorporated communities and census-designated areas.
- Fairview: 277
- Swananoa: 249
- Alexander: 58
- Leicester: 184
- Candler: 380
- Arden: 205
- Bernersville: 63
“Keith says we’ll probably have to hire more than one staff member to try and find the property,” Neumann said in an email. Administrative work could mean that there isn’t much additional public revenue generated by this approach. The hope was that vacation rentals might be a way to generate revenue that the county could use to mitigate the negative effects of overtourism.”
Miller described conversations and emails with Newman.
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“The whole conversation there was, ‘Are we going to evaluate[short-term rentals]with an income approach?’ said in
“And there are so many things to consider. Are they commercial or residential?” What are they best used for? What are they made for? There are many things to consider. There is also the consideration that starting valuations with an income approach can go down in value just as it goes up. So without actually knowing all the properties and understanding what they’re actually renting for, it’s impossible to get the full picture. ”
In an interview on Sept. 28, Newman said Buncombe’s survey of the future of short-term rentals is just a bunch of questions that need answers.
“I understand that this is not entirely within the jurisdiction of local governments (or local tax offices) to decide some of these issues regarding the classification of different types of real estate,” Newman said in an interview. “For me, it’s still early in the process.”
Additionally, he noted that the Sept. 1 email was not just about short-term rentals. This is only part of the picture regarding the county’s property tax assessment process. One of the driving goals of the Ad Hoc Reappraisal Committee was to evaluate as much of the housing market as possible and suggest ways to make the impartial evaluation process successful over the next few years.
“The purpose of that email I sent was that there’s actually quite a lot of very substantive follow-up going on here from the meeting with the tax office,” Newman said in an interview.
He said he’d be interested to hear from Miller on Oct. 18 about short-term rentals, but he’s more interested in whether homes are undervalued or undervalued in some places.
“I think that’s going on a little bit,” he said. “We don’t mean that it’s extremely inaccurate or anything like that…but we want to be as accurate as possible.”
Andrew Jones is an investigative reporter for the Asheville Citizen Times, part of the USA TODAY network. Reach him at @arjonesreports on Facebook and Twitter, 828-226-6203 or firstname.lastname@example.org. Please support this kind of journalism by subscribing to Citizen Times.