Lake Oswego’s Short Term Rental Rules Are Widely Ignored; Are Other Cities in the Same Boat?

Any scofflaws in upscale Lake Oswego?

Widespread abuse of Lake Oswego, Oregon’s short-term rentals program proves the point.

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

Residents who want to operate a STR are required to obtain a business license from the city and pay an $80 annual fee. They’re also required to see to it that the city is paid Transient Lodging Taxes equal to 6% of taxable income from the STR. The tax revenue is used for the promotion and development of tourism and visitor programs for Lake Oswego.

Sounds pretty 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 prominent STR websites shows a lot of people are ignoring the ordinance. 

According to information obtained from the city in response to a public records request, there were 42 active STR business licenses as of Dec. 1, 2022. However, a review of just two high use STR websites, Airbnb and VRBO, turned up 75 STRs with Lake Oswego addresses. 

Separately, AirDNA, a STR marketing firm, reported that as of Dec. 8, 2022 there were 90 active STRs in Lake Oswego, with 88% being entire home rentals and 12% private rooms.

Of the 90 STR’s counted by AirDNA, 96% had internet access and 8% had pools. Although some Lake Oswego properties are quite expensive, the average daily rate is just $170, generating average revenue per property of $2,682 during Jan -July 2022. The highest average monthly revenue was $3,333 in July 2022. 

Of the 90 STRs, 69% were listed on Airbnb, 17% on VRBO and 14% on both. 

The Lake Oswego STRs that pop up include everything from a $75-a-night cottage and $47-a-night private room to a “Modern, kid-friendly, walkable” $405-a-night 3-bedroom home and a $1467-a-night massive luxurious estate with 8 bedrooms and a pool. 

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. 

Clearly, a lot of people in Lake Oswego are cheating, diminishing themselves, feeding a culture of dishonesty and disrespecting their neighbors.

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.

It’s time for city government to lay down the law.

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