HomeMy WebLinkAbout08-11-23 Public Comment - W. Swearingen - Public Comment Commission meeting on STRs, follow-up comments, Aug. 10, 2023Bozeman City Commissioners:
My wife, Jennifer, and I watched the City Commission mee�ng this past Tuesday. We were
pleased to see that the Commission was inclined to support banning Type 3 short-term rentals.
It seemed like there was a good airing of the issue. However, one important reason to ban Type
3 STRs failed to come up.
In a mee�ng last year with Robyn Ehrlenbush, owner of ERA Landmark, I learned that only 51%
of residen�al sales in 2021 were to buyers for their primary residence. The remaining 49% of
sales were to non-resident “investors,” either investment firms (31%), vaca�on home buyers
(11%), or other non-residents for unknown purposes (7%). And Robyn acknowledged that some
buyers who stated they were purchasing the property for their primary residence may have
been concealing their inten�ons. Over a third of sales were cash sales.
Looking at this data, one can reasonably assume that half of the houses selling in Bozeman have
the poten�al to become Type 3 STRs. One could also assume that this ongoing unprecedented
real estate specula�on is driven by the opportunity to turn these proper�es into lucra�ve STRs
while these investments rise in value over the long term. The 2017 Trump tax law included
significant incen�ves for this type of real estate investment that significantly reduced the risks,
expenses, and tax liabili�es associated with real estate investment, and it has been a major
factor fueling the current real estate boom.
Banning Type 3 STRs will help to make this real-estate specula�on in Bozeman less atrac�ve. In
turn, this will help to curb the rapid escala�on in housing prices and help to free up proper�es
for local residents or new arrivals, who usually don’t have the cash to compete with out-of-state
investors. It will help to keep our community from being “hollowed out” and will put us on a
healthier and more sustainable foo�ng economically.
Will Swearingen