Tales of Lake Travis
Ken Hoffman explains why short-term rentals are a long-term hassle
Last week, Houston Mayor John Whitmire said he plans to crack down on the short-term rental industry in Houston. He said controlling the chaos that short-term rentals wreck on neighborhoods is now a priority of his administration.
Whitmire announced his intention after residents in several neighborhoods showed up a city council meeting and complained that short-term rentals were being used as out-of-control party houses and, in some cases, brothels. One resident said her family was awakened at 1:20 am by the sound of semi-automatic gunfire, and she discovered 20 bullet holes in her home the following morning.
Whitmire said his crackdown will mostly involve already-existing regulations, especially targeting property owners who operate several units in the same building. Whitmire said he wants these short-term units treated as hotels, which are subject to stricter safety regulations.
Asked what he will do if owners of multiple short-term properties squawk about facing enhanced scrutiny that will cut into their profits, Whitmire said, “This is why we have lawyers. We will see them in court.”
Ken’s lakeside condo
As the former owner of a short-term rental property my response to Whitmire is:
Go for it. I think a crackdown on short-term rental property owners who operate as fantasy hotel magnates is overdue.
Several years ago, I bought a condo in a large complex on Lake Travis. This is no b.s., as I was standing in the kitchen signing the final papers, a short-term rental agent knocked on the door. He said that he had managed my unit under the previous owner and it was one of his most successful properties. He said, “I normally charge 30 percent but because your condo is so popular with guests, I’ll drop it to 25 percent.”
He took me through the process. He would advertise my condo on Airbnb, VRBO, Vacasa, HomeToGo, Expedia, and other short-term rental sites. He would arrange for a cleaning crew after guests leave. He would keep track of the income and tax obligation. He said bottom line, if I kept the place in good condition, my unit could bring in $20,000 per year by renting it out on weekends. Anyway, I would be able to use the condo Monday through Thursday and weekends when the condo wasn’t rented. It sounded like a good deal.
Sign me up.
I did have one concern. Would it be creepy knowing that total strangers were, you know, doing it in my bed? The management guy said, “You don’t have a problem sleeping in a hotel bed, do you?” I said no. Looking back, that analogy makes no sense, but I had 20,000 dollar signs in my eyes.
Don’t get me wrong, most of the guests who rented my condo were fine people, no problems. The property manager had strict rules about my unit – no more than six people could stay in the condo, no pets, no loud parties, no smoking of anything, etc.
Then slowly, problems. I got a call from a neighbor. “Do you know that there are about 20 people staying in your condo?” I called the management person. Get them out of there, I said. He took care of it – chased most of the people out.
I started noticing things missing. Nothing of value, just stupid things like iPhone power cords, some souvenir Beatles glasses, a bed pillow. One guest took a remote for the garage door opener. I called the guest, did you take the garage door remote by mistake? The guest said yes, he was sorry. I gave him my address to mail it back. End of story, the replacement remote cost me $75.
Got a phone call from the cleaning crew. They found dog food under the bed. I called the guest, “Didn’t you read the rental agreement?” He got all red ass on me. He lectured me, it is a service dog. I don’t have to tell you that I’m bringing my dog. You can’t set any boundaries on my dog, like saying he can’t go in certain rooms or anything. And I think you’re making it up that you found dog food under your bed.
I said, how do you think I know you had a dog in my condo? The indignant dog owner said “too bad” and “do something about it.”
Other condo owners were renting their units out, too. While my management company was local and at least tried to enforce the rental agreement (for 25 percent), some condo owners listed their properties on Airbnb, etc., themselves. Instead of renting their condo to four people for $50 each a night, they’d rent to 10 college students who paid $20 each. It added up to trouble.
The complex pool, located under my balcony, had a curfew of 10 pm. I would sit on my balcony and smell weed coming from pool parties at 2 am.
The complex sent me a warning ticket for parking in a neighbor’s driveway. A guest did it. Two weeks later, I got a for-real ticket for the same thing. The complex didn’t care that I didn’t do it – I was responsible for my renters’ actions.
While being a short-term rental owner may mean big bucks if you own a slew of units, I didn’t make $20,000 that first year. Not after paying 25 percent to the management company, taxes, cleaning crew and buying replacement TV remotes. The worst part was, I learned to dread driving to Austin and staying in my condo. It didn’t feel like home. It did bother me that people were sleeping in my bed. I felt sorry for my neighbors who had to listen to loud parties after hours. Plus wear and tear was wearing me out.
I bought the condo for me, not for strangers. I took my condo off the market and sold it the next year.