HomeMy WebLinkAbout11-12-2013 ac friedmann 2ss1Goodwin, Heather
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For the record on Tuesday
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AGENDA
CORRESPONDENCE
Original message
From: Kurt Friedmann <Kurt@kfmail.com>
Date: 1lll0l20l3 3:39 PM (GMT-08:00)
To: "Christianson, Carlyn" <cchristi@slocity.ore>
Cc: "Davidson, Doug" <ddavidson@slocity.org>,"Johnson, Derek" <djohnson@slocit . ),"Codron,
Michael" <mcodron@slocity.ry),"Johnson, Lee" <ljohnson@sloiity.ry>
Subject: Re: Vacation rental numbers
Hi Carlyn,
Thank you for raising the "rental rate" questions to staff. There are a lot of different numbers flying around and
perhaps I can clarify some of the figures that are used to calculate TOT, short-term stay rental rates, and
occupancy rates so we can all be on the same page:
$120 Figure: $120 is used as a rate to calculate "granny unit" average pricing to illustrate the reduction in rental
stock issue that was most important to you. This seems like a very fair figure as some l-bedroom rates are $70
while others are $180 depending on quality. When we looked at all units on AirbnbA/RBO at the time of
enforcement, the average 1-bedroom rental came in at $120.
$150 Figure: This is the average rate of ALL vacation rentals, not just one-bedroom granny units. As you have
personally experienced, there are many properties that rent out multiple bedrooms for $300-$500 per night or
more. Vy'e went through all of the listings on Airbnb and VRBO and averaged the nightly rates out to come up
with $150, which was actually quite conservative. So staffs $100 figure is unrealistically low and significantly
underestimates TOT.
Staff TOT Figures: To get to an annual TOT figure, staff says the average rate is $100/night for ALL
properties. They also claim the the occupancy rate is just l3% (50/365 nights per year) . We know from actual
public booking data that the occupancy rate is approximately 50Yo. This is why staffs annual TOT figure is only
$40k rather than $250k, where it would likely be for staff s own estimate of 79 properties. By comparison, Santa
Barbara's TOT is $71 1k for 1 59 properties. (actual data provided by SB Finance Dept) That's 94,47 | per yeat,
per property in TOT. If we take staffs estimate of 79 properties for SLO and multiply that by $4,47l,that
would be $353k in annual TOT for SLO!! ! Our $150k figure was purposefully conservative so no one could
argue with it. And yet...
Johnson, Derek
Sunday, November 10, 2013 5:59 PM
Goodwin, Heather; Codron, Michael
Fwd: Vacation rental numbers NOv 12 Zoi3
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If staff s estimate of $ 100 per night at a l3Yo occupancy rate were accurate, that would mean that the average
VR in SLO generates just $5k PER YEAR in gross income (prior to expenses) and $500 in annual TOT for the
city at l0% . $5k per year does not even cover the expenses of running a vacation rental. Honestly, what voter
in their right mind would do this and still be pounding at your door for regulation change? It just doesn't make
economic sense.
Finally, if we believe that vacation rentals only have a l3Yo occupancy rate, what kind of neighborhood impact
is that in comparison to a95Yo occupancy rate for long-term rentals? Even at 50o/o,the environmental impacts of
short-term rentals arc -at best- half that of long-term rentals. You can't have it both ways... underestimate TOT
and you must also underestimate impacts.
Please call me at234-0648 if I can provide clarification. I'll support the decision, as long as it's based upon real
and reasonable facts. Perhaps an oversight was made in the calculations? It happens. Thanks for including this
email in the council record so all council members are comparing apples to apples in order to arrive at a
reasonable decision on Tuesday.
Best regards,
Kurt
On Nov 70, 2013 , at I : I 8 PM, Christianson, Carlyn wrote
Hi Kurt,
It occurred to me that I have asked staff to address the different rental rates used by SLOHost in the Attachment for the
staff repoft, and that SLOHost might want a chance to address the same issue, So--why is $120/night used for the
estimate on income to the owner, and $150/night used for the estimate on income to the city?
I just want to make sure that people are comparing apples to apples, as it were,
Thanks you
Carlyn
Carlyn Christianson
Member, San Luis Obispo City Council
990 Palm Street, SLO 93408
cchristi@slociW.oro
805-550-9320 cell
805-752-1021 home (for city calls)
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