Texas city sees a short-term rental shakeup. Who stands to win and who could lose from the move

1 month ago 13

Monique Danao

Mon, Apr 28, 2025, 3:00 AM 3 min read

Short-term rental operators successful Austin, Texas are bracing for a fiscal curveball aft the metropolis implemented an 11% “hotel occupancy tax” (HOT) connected short-term rentals similar those listed connected Airbnb and Vrbo.

City officials judge the lodging tax, which kicked successful April 1, volition assistance modulate the manufacture and make gross for section services.

“The contented is that we person these corporate-owned STRs that travel into our metropolis that bargain up full blocks,” Austin City assembly subordinate Vanessa Fuentes said. "They're buying up affordable lodging banal and impacting our affordability levels."

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The metropolis collects astir $7 cardinal annually from short-term rental operators — a fig expected to ascent importantly with the taxation hike.

But the taxation has drawn interest among section homeowners who person utilized short-term rentals to subsidize their lodging costs.

Blake Carter, co-founder of Cribs Consulting, a institution that owns and manages astir 85 short-term rental properties successful Austin, has already seen the interaction connected guests.

“It looks similar the platforms are adding it to the impermanent broadside truthful that the guests are paying more,” Carter said successful an interrogation with Austin ABC affiliate KVUE.

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That could unit short-term rental operators to little their rates to support their fees dependable — and debar pushing guests away.

On the agleam side, Carter added, it could displacement request for short-term rentals to the suburbs.

“They tin support their rates and inactive beryllium priced the aforesaid arsenic if they were successful Austin,” helium said, appealing to much charismatic to budget-conscious travellers.

If the taxation yet causes immoderate operators to unopen down their short-term rentals, it could unfastened up much semipermanent lodging to section residents, who whitethorn presently beryllium pushed retired of high-density short-term rental neighbourhoods.

As the summertime question play approaches, visitors and locals volition beryllium watching to spot however this caller taxation changes the scenery — and who the winners volition be.