Clark County seeks to tame short term rental beast, protect neighborhoods

Forced by a new state law to confront the reality of mini-motels in Southern Nevada neighborhoods, Clark County commissioners who have ignored the issue until now appear intent on imposing significant restrictions on the burgeoning vacation rental industry. 

The law, sponsored by Southern Nevada Assemblywoman Rochelle Nguyen, does not apply to neighborhoods in HOAs, unless vacation rentals are expressly permitted in the community’s codes, covenants and restrictions.  

Las Vegas is the most profitable location in the U.S. to own a vacation rental, according to Airbnb data collected by Compare the Market, a price comparison website based in the United Kingdom. The average monthly rent for an Airbnb in Las Vegas is nearly $10,500, which is 555% more than the average rent for a lease.

The revolving door of tourists in and out of homes in Southern Nevada neighborhoods often pits homeowners against one another in a battle over quality of life.   

Almost 6,000 individuals responded to a survey conducted by the county that found 55% have a negative perception of STRs. 

• 66% said neighbors should have involvement in the permitting process 
• 72% said safety inspections should be required 
• 80% said multiple substantiated complaints should result in revocation
• 72% want no more than 16 occupants in one home 
• 25% want no more than eight guests allowed in one home
• 77% want occupancy limited by the number of bedrooms
• 70% want maximum occupancy of two per bedroom

The commission is contemplating allowing one percent of available housing stock to be used for vacation rentals, a threshold adopted by San Diego County. That amounts to 2,849 permits in unincorporated Clark County. Currently, there are as many as 12,000 unlicensed vacation rentals operating in the area. 

County staff recommend the ordinance, which must be crafted and passed before July 1, include a lottery to select winning applicants.  

Commissioners explored a number of options for more stringent requirements than those included in Senate Bill 363, a bill that applies only to Clark County.  

Commissioners expressed interest in increasing the state’s distance requirement of 660 feet between STRs to 1000 feet. 

In an effort to curb corporate ownership, AB 363 imposed a cap of five STR licenses for one owner or entity, such as an LLC.   

“There’s nothing stopping somebody from having 10 LLCs,” Commissioner Michael Naft noted. 

Commissioner Tick Segerblom suggested the county require ownership information from applicants, including LLCs, and prohibit the same owner from holding more than one license.  

The new state law prohibits more than ten percent of units in a condominium complex from being used as STRs.  Commissioner Kirkpatrick suggested prohibiting condo units from being used as vacation rentals. 

“I’m not here to help the hedge funds or the people that live in other states to take away the housing that we need ourselves and so it just seems unreal…” she said.  

Enforcement of the new ordinance, which must be adopted before July 1, is expected to be expensive.  

“It is not just 2,800 (property owners) we’re going to be dealing with. We’re going to be chasing thousands,” Commission Chairman Jim Gibson said of the thousands of the illegal operators. 

Segerblom, who recently held a town hall on the proposed ordinance, said he didn’t realize when the law was passed that the room tax generated by STRs goes to the “bigger room tax.”

“So I think we should ask the Legislature to revise that so the room tax for these properties comes to us,” he said. “We have to fund supervision. It’s going to be a huge amount.”

Kirkpatrick suggested doubling the current enforcement budget to accommodate “those neighbors who don’t want them, period. I’d probably be one of them. I’d call every time they were parking in the street or (in front of) a fire hydrant.” 

Gibson says the county can leverage licensure as a means of policing existing nuisances.

“Now we have a completely different setting where, rather than having the kinds of issues that we have just with homeowners who violate the law, there is a business license, there is an investment, there is something more…” he said. 

Naft suggested advancing the Water District’s policy preference for “moving away from septic” by requiring applicants to be connected to municipal sewer.  

“These are now commercial venues. So they should be licensed for trash as commercial…” added Kirkpatrick.

State law gives the county the ability to fine legal operators up to $1,000 per incident and illegal operators up to $10,000 a day.  

A provision of the new law requires platforms such as Airbnb to include license information in its online ads in an effort to help the county identify unregulated operators.  

“They are not willing to work with us today,” Kirkpatrick complained of the platforms. “They’re all illegal and there’s thousands of listings.” 

“The reality is there’s a couple hundred venues, some more willing to work with us than others,” said county staffer Jim Anderson. “Some are in other countries. We have no teeth.”