McGill Report on Short-term Rentals: Problem for Our Hillside Neighborhoods and Problem for Our City
Three deaths and four wounded were reported at a problematic short-term rental property at the 2700 block of Ellison drive in the Benedict Canyon hillside community on January 28, 2023. There have been other similar incidents in our hillsides (see links below).
Some of these problematic short-term rental properties have prompted the Bel-Air/Beverly Crest Neighborhood Council to prepare a “Party House Handbook” that helps affected residents to properly report nuisance houses so that LAPD and the Neighborhood Prosecutor to penalize and hold the property owners accountable for nuisance behavior and crimes at their properties.
As for the impacts on the City of Los Angeles, a report prepared by researchers from the Urban Politics and Governance research group, School of Urban Planning, McGill University proves an interesting analysis. This reports examines the economic benefits and costs of online short-term rental (STR) platforms such as Airbnb to the City of Los Angeles, across four categories: Housing impacts, tax impacts, employment impacts, and other impacts.
In addition to providing a brief overview of the STR market in Los Angeles, the report evaluates each of these impact categories, then offers recommendations for addressing the disparity between negative and positive impacts of STRs on Los Angeles:
Short-term rentals in Los Angeles: Market Overview
• There have been an average of 3,300 STR listings active in Los Angeles each day in 2022.
• STR activity in Los Angeles is highly concentrated in the Venice, Downtown and Hollywood neighborhoods.
• Almost half (45.0%) of STR listings in Los Angeles are illegal. Regulatory compliance appears to be declining.
STR Housing Impacts
• Commercial STRs have taken 2,500 homes off the long-term market in Los Angeles.
• STRs have raised rents $810 per year for the average renter household in Los Angeles.
• STRs are responsible for more than 5,000 extra people experiencing homelessness each night in Los Angeles.
• Just 10% of hosts earn more than half (53.8%) of all STR host revenue.
STR Tax Impacts
• The City has lost between $56.8 and $302.2 milling in un-assessed HSO fines in the last year.
STR Employment and Wage Impacts
• The entry of STR platforms into the City of Los Angeles could be expected to have reduced permanent employment in the hotel sector by more than 400 jobs.
• The entry of STR platforms could similarly have reduced annual wages in the otel sector by between $400 and $1,300 per worker.
Additional STR Economic Impacts
• From July 2019 through August 2022, the City received 4,370 complaints about STRs.
McGill study financed by Better Neighbors LA which is an alliance of housing advocates and the hotel workers' union.
What has the McGill study prompted legislatively?
A Motion (CF# 22-1506), introduced by Councilmembers Blumenfield and Harris-Dawson, moved “that the Los Angeles Housing Department, Department of Building and Safety, and the Department of City Planning be instructed to report within 60 days on the results and accuracy of the STR study from McGill University, provide a status report on the Home-Sharing program in Los Angeles, and a specific action plan to cure any problems that are confirmed or revealed.”
The Motion was heard in PLUM on Tuesday, February 7, 2023, and explicitly refers to this McGill University study.
• JAN 28, 2023 - 13200 Block of Ellison Drive (Benedict Canyon
LOS ANGELES TIMES “Benedicy Canyon shooting that left 3 dead, 4 wounded was not random, police say”
• AUG 3, 2020 - 13200 block of Mulholland Drive
• AUG 26, 2020 - 2200 Block of San Ysidro Drive
LOS ANGELES TIMES “Shooting at party house leaves one dead, one injured in Beverly Crest”
• MAY 16, 2020 - 1417 Mulholland Drive
• JULY 4, 2020 - Nuisance party with fireworks at 10701 Bellagio Road
• JUNE 18, 2021 - 10 minute delay on LAFD emergency response call due to Tik Tok party’s blocked roads