Vacation Rentals Cause Affordable Housing Rut In South Lake Tahoe

For the first time, South Lake Tahoe has just as many vacant homes as occupied ones. That’s according to a new report commissioned by the South Lake Tahoe City Council and made public at Tuesday's council meeting.

The report is aimed at solving challenges that come with the short-term Vacation Home Rentals market that has blossomed in recent years. It was standing room only in the South Lake Tahoe City Council Chambers.

James Betzing, who drove up from Folsom early to get a seat, owns a house in the Tahoe Keys and rents it when he isn’t using it, but says he barely makes enough with it to cover his expenses. His city permit to rent it has gone up from $135 a year to $600 a year. Now it could go to $1,500.

“So finally if they keep going it will price us out of the market and then they are going to have another problem, which would be abandoned houses,” Betzing says.

But some owners are earning four times what they would get from a long-term rental. A 156-page report by Michael Baker International and staff from Sacramento State University says the city needs to look at saturation of short-term rentals, tiered permitting, creating an online service center, fines for illegal rentals, enforcement and mitigate the impact vacation rentals are having on affordable housing.

Taking houses off the market for vacation rentals means fewer options for long-term renters.

“I am looking at dumps.”

Teresa DeJournette was standing just outside the meeting watching it on TV. She broke down in tears and blames vacation rentals for increasing her rent.

“I have lived here 40 years and I can’t afford $1,100 a month plus water. This has been my home since I was 22 years old and I want to live in Tahoe," DeJournette says in-between tearing and sniffling. "I’m sorry.”

The report says more revenue from vacation home rentals could be used to create a program to increase the supply of long-term rentals for people like DeJournette. South Lake Tahoe Mayor Austin Sass hopes it will only take four months to decide what recommendations to implement.