AUSTIN, Texas (CN) — Homeowners across the nation are fighting back against cities' attempts to stop them from renting out their homes for short stays, through websites such as Airbnb and HomeAway.
Los Angeles last week sued the owners of three rent-controlled apartment buildings, claiming they illegally evicted tenants to try to make more money through short-term rentals.
Even as Los Angeles City Attorney Mike Feuer filed his cases Friday, homeowners in Austin, Texas sued the city on constitutional claims, challenging a law that makes it more difficult for them to rent their houses. The Austin homeowners say the new city ordinance is "carpet bombing" their constitutional rights.
And on Monday in Los Angeles, a federal class action made similar arguments against the City of Santa Monica.
Los Angeles' lawsuits differ from the ones involving Austin and Santa Monica, as Feuer is going after landlords of multi-unit housing, not private homeowners, but all the cases stem from the rapid growth of Internet ad sites for short-term rentals.
The Santa Monica class action, from lead plaintiff Arlene Rosenblatt, cites both websites as ways for homeowners to make money, and claims a city ordinance that attempts to ban short term rentals is an unconstitutional restraint of interstate commerce, an unconstitutional taking, and de facto condemnation.
The City Council approved the ordinance on May 12, 2015 and it took effect on June 15 that year. (Santa Monica Municipal Code Section 6.20.010 et seq.)
Rosenblatt says Santa Monica enacted the ordinance to pad city coffers: specifically, to protect the 14 percent transient occupancy tax it collects on hotel and motel rooms.
She claims that Santa Monica's 3,483 rooms in its 34 hotels are inadequate for the city's tourism industry and the shortage drives up prices at Santa Monica's already overpriced hotels, many of which start at $500 a night.
In June 2015, when the city enacted the ordinance, the occupancy rate at Santa Monica hotels was 86.2 percent, compared to a nationwide occupancy rate of 65.6 percent, according to the complaint.
To top it off, she says, the median rent for a one-bedroom apartment in Santa Monica in January was $3,490, making homeownership a valuable asset for anyone with a room to spare.
"The ordinance not only prohibits engaging in transactions for short-term rentals, but also prohibits utilizing the Internet, the interstate marketplace for short-term rentals, or any other forum to list, facilitate, or advertise short-term rentals," Rosenblatt says in the complaint, though she does not specifically allege a First Amendment claim.
She seeks class certification, declaratory judgment, an injunction and punitive damages.
She is represented by Jordan Esensten, of Los Angeles.
Meanwhile in Austin, Ahmad Zaatari et al. sued the city and its Mayor Steve Adler in Travis County Court. All seven plaintiffs rent their homes for short terms. Six of them have a Type 2 city license, one has a Type 1 license.