Caught in the middle with a Napa vacation rental
By John Stephens
I didn’t always have such a dim view of landlords.
It only started in my Berkeley days, when I asked the landlord permission to upgrade a washroom into a third bedroom. I wired, sheet-rocked, painted and installed new electrical. I could even lay in bed and flip a switch turning on the lights and starting the coffee pot. After I finished I showed the landlord my handiwork. He was impressed.
The very next month, he raised the rent. I was shocked and insulted. His explanation was that even though I paid for all the improvements, the house was worth more now and deserved a higher return. If I didn’t like it, I could move.
From then on I was skeptical of the claims of landlords that they only provided a service. In reality, the tenant largely pays for the owners’ mortgages. Every few years, the landlord might cash out or refinance out at a handsome profit. Then the rent would go up to pay for the buy-out in the form of a new, higher mortgage.
Now I am on the other side. I rent out a small apartment to a low-income family at a below-market rate. I try to be a humane, caring landlord. When my wife and I had burned our mortgage, we decided to borrow on our home, buy another and rent it out on a daily basis to visitors who would rather rent a whole house than a tiny box of a room in the big, overpriced hotel. The rents could pay for the expense of holding the property, unlike a monthly rental. The city was allowing people to do so under a business license and was happy to collect the hotel tax.
There are about 44 vacation homes operating legitimately in Napa. So we planned to do the same. We mortgaged our house and bought an abandoned, derelict of a home in Alta Heights. It was a real fire hazard. We completely renovated it, and it is now the belle of the block. The neighbors are happy the homeless are not camping out next to them.
Suddenly, in January, the city stopped issuing business licenses for vacation rentals without public notice, discussion or debate. Apparently, a developer who couldn’t sell his condos wanted to change his 25-unit development into vacation rentals — a kind of hotel operation in a residential area. That made the city tighten up the reins.
As an advocate of housing for the people who live here, and to keep housing within city limits and not out in the ag areas, I support the city in trying to maintain available housing for our local residents. If too many houses are pulled out of the rental market and used for tourists, it will increase housing prices generally and, most importantly, increase rents due to scarcity. Also, too many cars going in and out of a house and loud parties — especially if they are next door to you — can be a real problem. However, I feel a very limited number of houses for tourists could be a reasonable alternative to the big hotel experience. Condos shouldn’t be allowed to convert to glorified hotels or vacation rentals and be taken off the market. It should be no more than a handful and shouldn’t impact housing prices or rents of in Napa. Some quiet neighborhoods wouldn’t want all that new traffic and strangers coming in and out.
We have a responsibility not just to enrich ourselves but also to enrich the community in which we invest. I may have to change my vacation rental plans. Rows of real estate agents and investors are anticipating, even eager, for an answer to the question of how many vacation rentals will be permitted, where they may be located, and how they impact zoning and the neighborhoods. In fairness to those of us caught in the middle, there should be public notice that the practice of granting business licenses for vacation houses are to be stopped.
(Stephens lives in Napa.)
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bornin74 wrote on Mar 14, 2008 8:18 AM:
Looks like you are flip flopping on both sides of the fence. Would you still be writing this letter if your house was already "included" in the selct few?. Go ask one of our esteemed city council how her house was included in this exclusive club?. Sounds like you may be a little late on the band wagon, and not being part of the "in crowd" is going to cost you....
I have an idea, go down and contribute LOTS of your hard earned money to some of their coffers, and I just would bet, that your home will be MAGICALLY included..... Otherwise rent the darn thing out. Houses in Alta Heights are HIGHLY desirable, and listing your home for a long term rental in the right places will attract maximum value. You could rent that place out right now for $1800 a month minimum and people would be scrambling to get it.
I know if I was a neighbor of one of these "vacation homes" I would be very upset. I don't want to see different people coming and going on my street constantly. Every weekend some new person comes to move in, drives home drunk down my street at the end of every day of wine tasting, parties in the backyard like it's "1999" and then goes away only for another group to come in the next weekend.
Too bad the market wasn't better, you could "flip" that house for a nice profit, then buy another, flip it again, and son on. NOW there is long term income!!!!. "
common sense wrote on Mar 14, 2008 8:35 AM:
Dwayne wrote on Mar 14, 2008 9:17 AM:
northbaylocal wrote on Mar 15, 2008 5:27 PM:
I don't think neighbors should have veto rights about having a vacation rental -- but I do think their concerns should be taken into account if there are problems. Let's experiment with a limited number of vacation rentals -- they bring in taxes for the city, they bring quality tourists to our valley, and they let some home owners hold on to their property in a terrible housing market. "
interested wrote on Mar 20, 2008 2:30 PM: