Short-term renters abuse the rules

By William MacKenzie,

Lake Oswego encourages visitors.

“If you are visiting or thinking of visiting Lake Oswego, we welcome you,” says the city’s’ website. ” Whether you’re coming for business or pleasure, you’ll encounter an inviting community, friendly people and businesses, and plenty to see and do.”

At the same time, in response to citizen concerns about maintaining livability, Lake Oswego has tried to regulate short-term visitor rentals. But local property owners are widely ignoring the city’s short-term rental (STR) rules.

Lake Oswego tried to get a handle on controversial STRs in 2019 by enacting Ordinance 2815. The ordinance allows STRs (rentals of less than 31 days) of certain residential properties.

Since then, residents who want to operate a STR have been required to obtain a business license from the city and pay an $80 annual fee. They’re also required to pay Transient Lodging Taxes equal to 6% of taxable income from their STR. The tax revenue is used for the promotion and development of tourism and visitor programs for Lake Oswego.

It’s all pretty straightforward and simple. If you own a property being used for STRs, you need to get a business license and pay taxes on your revenue. But a review of city data on STR business licenses and on a national STR website reveals a lot of people are ignoring the ordinance, with the number of STRs and the number of scofflaws actually increasing over time.

At the end of 2022, according to AirDNA, a STR marketing firm, there were 90 active STRs in Lake Oswego, while information obtained from the city in response to a public records request revealed there were just 42 active STR business licenses. The discrepancy was brought to the attention of the City Council in hopes it would address the problem.

AirDNA reports there are now 161 active STRs in Lake Oswego, but, according to publicly available Lake Oswego licensing data, there are just 81 active STR business licenses.

In other words, the number of licensees has gone up, but so has the number of scofflaws.

The STR occupancy rate over the past 12 months has been 66% and the average market charge per day has been $246.90.

The Lake Oswego STRs that have popped up include everything from a $61-a-night guest bedroom to a $288-a-night 3-bedroom home (“a serene sanctuary where the forest meets modern luxury.”) and a $1452-a-night massive luxurious estate with 7 bedrooms, plus a pool, sauna, hot tub and theater room.

It’s not possible to identify the addresses of all the properties without trying to book them one by one. Website maps, reveal, however, that they are spread all over Lake Oswego.

If a STR is found to be in violation of City Code, the city may suspend or revoke its business license, if it has one. The property owner may also be cited and have to pay a fine or appear in Municipal Court.

So come on malingerers. Step up. Do the right thing.