Massachusetts governor signs law regulating short-term rentals

Dive Brief:

Massachusetts Gov. Charlie Baker has signed into law regulations on short-term rentals through businesses such as Airbnb or HomeAway, according to MassLive and others. Baker's signature comes after months of back-and-forth with legislators on amendments and tweaks to the bill.
One of the most noteworthy inclusions is that many short-term rental hosts will have to pay the same 5.7% state excise tax as hotels. Municipalities will have the option of imposing their own excise tax up to 6%, except in Boston where it will be up to 6.5%. In addition, all hosts will be required to register with the state and carry insurance.
Massachusetts is the first state to require all short-term rental hosts to register. The regulations go into effect on July 1.

Dive Insight:

One of the larger sticking points that previously delayed the legislation's passage centered on hosts who only rent their homes a few days each year, rather than those who do so regularly. The new law exempts hosts who rent their properties for less than two weeks each year from having to register with the state and pay the excise tax.

Another sticking point was the implementation of a public registry for all hosts. The hotel industry pushed for such a registry but opponents voiced concerns about hosts' privacy. Under the new law, the state will post a property's neighborhood and street, but not the full address.

A number of cities recently have passed or are looking into similar short-term rental regulations, but Massachusetts is the first state to adopt such measures. Government leaders view these laws as a way to collect lodging taxes while still allowing citizens to earn money by renting their properties.

Another major reason leaders favor short-term rental regulations is to lessen the impact of their housing crises. Leaders report a shrinking supply of available housing due to the attractiveness of owning and renting out non-primary residences to visitors — who often pay higher rates for short-term lodging — as opposed to full-time residents. Baker said Massachusetts' new law will even the playing field between short-term rentals and other similar businesses like hotels.