Short-Term Rentals Will Get New Rules in Early February

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Denver's Department of Excise and Licenses is weeks away from enacting new rules for short-term rentals, which would take effect at the beginning of February.

The updates include new insurance requirements for getting licenses and would clarify the grounds on which a license application can be denied or revoked, including failure to comply with city or state laws. A license can also be revoked or denied if a rental property "adversely affects the public health, safety, or welfare of the immediate neighborhood in which the property is located."

Short-term rental apps like Airbnb typically provide insurance for operators. But under the new guidelines, operators would have to notify their regular home or apartment insurers, as well as the City of Denver, of their plans to turn their dwelling into a short-term rental, as well as their HOA, since HOA insurance often covers common areas that could be used by guests.

Excise and Licenses staff wrote the rules using input from the public and the Short-Term Rental Advisory Committee, which is made up of city council members, industry stakeholders and concerned residents, among others.

The Department of Excise and Licenses has required licenses for short-term rental operators, which include any rental that's offered for thirty days or less, since the beginning of 2017. But that hasn't prevented problems from arising. The department says that some of the most frequent complaints it gets are about too many guests lodging at one location or renters violating the primary-residence requirement, which requires that they live in the same house or apartment they're renting out.

On January 17, Excise and Licenses will hold its first administrative hearing, essentially a less formal trial, for a short-term rental operator who neighbors say violated the primary-residence requirement. The operator faces sanctions, including license revocation and monetary penalties.

Excise and Licenses is passing all of these regulations to strike a balance between public safety and fostering a business-friendly environment, says director Ashley Kilroy. "We want to make sure we protect our neighborhoods and our community and also welcome tourists."

The department says that Denver has a 60 percent registration rate for short-term rentals, one of the best in the U.S.

Denver's Office of Economic Development has been analyzing the effect of short-term rentals on housing affordability since November; the analysis should be wrapped in March. 

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