A condominium in downtown Asheville houses 9 illegal Airbnbs and short-term rentals. However, the active rental listings on Airbnb and Vrbo do not have valid permits. Despite the reports, no fines were issued to the illegal Airbnbs.
Illegal Airbnbs in Downtown Asheville
A condominium at 17 North Market St. houses nine illegal Airbnbs and Vrbo short-term rental (STR) units. The listings have glowing reviews on their respective listing websites. However, none of these rental units have valid registered permits through Asheville City. Nonetheless, the listings are active and up on Airbnb and Vrbo.
According to Ken and Joan Pierce, the only full-time residents at the condominium, they have been living with guests of illegal Airbnbs and Vrbo rentals for two years. They love the city of Asheville but feel trapped in a nest of STRs. The city filed violation notices against some units in the building. This could lead to penalties of $500 a day. As a result, the owners of the nine condo units came together to apply for a change of their units’ use permit in January. They want to file their condo units as a hotel.
Some of these units have been active since the condominium’s renovation in 2021. This was long after the practice was banned in 2018. In 2022, former resident Hiren Patel filed a report for STR activity in the building. However, there was no action against the listings until recently.
Fines Avoided by STR Owners
The building’s homeowners say the illegal Airbnbs avoided almost $1.6 million in penalties as the city has conversations about further regulations due to increased Airbnb usage. Ken Pierce said they knew what the city ordinance was, and they relied on the city. They thought the rule would be enforced and the units would be fined.
Kim and Christian Oliver own another unit in the condominium. They live across the hallway from the Pierces and want to move to the area full-time. According to Christian Oliver, the penalties would likely be in the hundreds of thousands or possibly millions.
They compiled over 830 reviews from Vrbo, Airbnb, and Towns Property Management listings for the condos. The Olivers calculated the fines and concluded that unlevied fines amounted to $417,000 if all the reviews led to a $500 fine. However, since many guests do not leave reviews, those unlevied fines could amount to $1.6 million. According to Kim Oliver, the real problem lies within laws and enforcement.
Notice of Violation Issued
According to city spokesperson Kim Miller, Asheville City is issuing a notice of violation to at least eight of the night STRs. The penalties could come later. They have issued four citations for properties that have already received a violation notice. One additional unit was issued a violation notice. Moreover, three other properties are being inspected for compliance. While all nine illegal Airbnbs could be given citations, the city will only issue fines if the properties do not comply.
Lack of Cooperation From Listing Companies
According to City Councilwoman Sage Turner, the issue with city regulation is that listing companies do not always cooperate. Enforcing short-term vacation rental (STVR) rules is challenging but not impossible. Airbnb and similar platforms have the tools needed to clean up issues with enforcement. However, they refuse to turn on the tool for the city of Asheville despite doing so for other cities. According to Turner, they attempted to negotiate with these listing companies for months. They agreed to add the required tool if they free up large parts of the city for STVR use.
Only three STR violation reports were through the Asheville App between November and December. In January, there were 24 reports due to the increased coverage of STVR regulations. These reports are one of the few methods the city uses to manage STVRs. Without these reports, the city is left to chase after and prove these illegal rentals. This is time-consuming, costly, and relies only on leads from neighbors. On the other hand, dealing with STVR companies like Airbnb and Vrbo entails some delays and legal processes. This can impact enforcement timelines.
Frustration Among Homeowners
The Pierces and Olivers did not want to start a war inside the building and begrudgingly made peace with it. However, their stances changed when the STVR owners filed to make the condo units into a mixed-use hotel. The homeowners only found out about the application after the Citizen Times report. They were not told of the application.
According to the Pierces and Olivers, they were explicitly told the building would not have STVRs when they bought their units. However, they now have to worry that the proposal could change how they live. Ken Pierce is an active board member of the building’s homeowners association. He also partnered with business owners to clear the alley beside the building.
Now, the application’s fallout has frustrated them. It also led to tension with their friend Brett Krueger, one of the developers of the building and a representative for the hotel project. Ken Pierce said it was a complete shock. He is one of the three board members, while the two others are the developers. Hence, the application did not come before the board or the membership but was done secretly.
According to Kim Oliver, she felt the application for a change of use permit was to avoid city regulation and fines. This is because the homeowners begrudgingly accepted the STRs. After all, they thought they could not do anything about it.
Living in the Nest
The 17 North Market St. building is beautiful. It has a main foyer with high ceilings, referencing the building’s history as an Anderson Motor Company location. Its rooftop lounge provides a stunning view of the city skyline and even offers a fire pit. However, living in the building is a different experience.
According to Ken Pierce, some renters roam a little loudly or drunk up and down the hallway. On the weekdays, the Pierces may be the only ones in the building. Other cars in the parking garage often belonged to STVR renters or unit cleaners. Joan said the cleaners had used their parking space so many times they decided to place a traffic cone on their spot.
“Another thing about renters is they take your stuff all the time, like our wagon,” said Ken. He usually needs to track down which room might have the wagon they use to bring around groceries.
The garage and the building’s units fill up on the weekends, especially in the summer. It’s been this way for some of the units since “day one,” according to Ken Pierce. The issue of legality was raised in various contexts. It violates the HOA’s covenants.
Listings With No Permits
All nine illegal Airbnbs petitioning to become hotel rooms are listed on Airbnb and Vrbo. However, none of the units have valid STVR permits with Asheville City. Most units charge $304 per night. However, most Vrbo reviews indicated guests often stay more than one night. Some even stay for up to one week.
Towns Property Management, an Asheville-based property management company, manages eight of the nine condos. It currently manages 103 STRs in Asheville on its website.
The application submitted on January 9 was incomplete. This prompted a back-and-forth correspondence with the city of Asheville. However, according to City Principal Planner Will Palmquist, the city will now require an affidavit from all condo unit owners for the project moving forward. The application will be considered incomplete until all affidavits are given.
Brett Krueger said the goal the whole time was to “comply with the city.” He told the Citizen Times on February 1 that if he knew they would be upset, he would have called them.
