Raleigh taking more time to review online room rentals

The council in December declared the services of Airbnb and other room-sharing applications illegal after getting a complaint from a Five Points resident about a neighbor's rental.

Airbnb serves to connect homeowners with visitors seeking to rent a room as an alternative to a hotel stay.

Opponents say such services undercut hotel taxes and present a traffic problem for residential neighborhoods. Airbnb users argue that regulations on the service impinge on a homeowner's right to use his or her property to make some extra income.

Crane found that the rentals have both pros and cons. While they offer additional income both for property owners and, through a permit fee, the city, they can create additional traffic and parking hassles in residential areas.

Under the city's current "Bed and Breakfast" laws, such rentals are allowed, but only in historic districts, historic landmarks or properties listed in the National Register of Historic Places, Crane found.

City leaders have the option to sticking with the status quo, expanding and defining the zones where short-term rentals are legal or establishing a permitting process for those who wish to rent their properties. Any change would take time and allow for public input.

Crane reported that cities that allow Airbnb and similar rentals often set limits. Many require that the property owner be on-site and restrict the rentals to certain areas. Most have a permit process and cap the number of renters or the space that can be rented.

In other business, the City Council selected Transfer Company LLC to redevelop the Stone’s Warehouse site, at 500 E. Davie St. The project will put a food-production hub anchored by local businesses, a community hall and gathering place, a micro-production facility or restaurant, a neighborhood grocery and café and 16 townhouses in the historic warehouse and nearby buildings.

The council also accepted a $1.1 million bid from Holt Brothers Construction to renovate Market Plaza and Exchange Plaza downtown and scheduled a Feb. 3 public hearing on a proposal to rezone a site at Hillsborough Street and Pullen Road for a mixed-use development that would include up to 82 residential units, offices and retail space.