Homesharing in Los Angeles : Our Stories
Pico Union is the community where my family and I moved in 23 years ago after immigrating to the city of Los Angeles. In this community as a young immigrant I attended several public schools like Berendo Middle School, Manual Arts High School and proudly graduated from these schools even after overcoming many obstacles that new immigrants face in this country. While attending Community College in the same downtown Pico Union community I met my now wife and long time business partner. We both were part of The Puente Project at Los Angeles Technical Community College where we had the pleasured to be students of council member Mr. Jose Huizar in a Puente Program Political Science class. With the help and guidance of this program we were able to successfully transfer and graduate from California State University Los Angeles with business and technology majors.
A few years later through much hard work and dedication my wife and I open a small business in the fashion district in downtown Los Angeles that we still proudly own and operate till this date. With our roots deeply cemented in this community we decided to invest all of our lives savings by having the opportunity and blessing to purchase our long time rental house from our former landlord.
The house is a four-unit RSO Craftsman style house build in the 1920s nested in the heart of Pico Union. This house has been my family’s home ever since we came to this country. We have share lots of beautiful memories and countless memorable events in my family’s history. Moving somewhere else after the owner decided to retire and sell the house was not an option for us. We had come to live, respect, invest, and appreciated this community and this house became a big part of who we are today.
Currently my wife, my 4-year-old daughter and I live in one of the house units. My parent’s live in another unit and on the third unit we have RSO long-term tenants. In the last unit that seats vacant we do home sharing to supplement our income to maintain the house, pay the mortgage, pay city taxes, pay for health care cost and cope with the ups and downs that small business face day to day.
The new home sharing regulations put in place by the city of Los Angeles will deeply impact our ability to continue to live and share our community of Pico union.
Our house falls under Rent Stabilization and home sharing is not allowed in this type of properties under the new policies. This new policies we believe fail to differentiate between multi million dollars RSO apartments buildings and small family businesses that own 2-4 unit properties. Most Mom and Pops RSO property owners like myself and my family rely on the income of home sharing to continue to afford the high prices of living in this ever growing and changing city and to afford to stay living in our communities.
In addition to the financial hardships we face by the new home sharing policies, my family and I will loose the ability to share our beloved community of Pico Union with people around the country and the world. Many business in our community would be loose the traffic and business that our guest bring to our neighborhoods. One of the greatest things that we like and feel more proud of is when we see that our guest interact and contribute to the economy in our community. When we notice small businesses in the corner of our house getting new customers from our guest or when we see the guest eating embracing and supporting the small Mexican/Central American restaurants in our community.
As a long time resident and proud owner of a RSO property in Pico Union I urge you council members to please consider a motion to include RSO property owners of 2-4 home units to continue to host and share our home by participating in the new digital era of home sharing.
I have been a local Angelino since 2008, living in various parts of the city. In 2016, I purchased a fixer-upper triplex in the Eagle Rock area. I put a significant amount of my own savings into renovating it, and bringing the original 1926 construction up to code. Here are some quick points about this house:
I inherited a rent-controlled tenant, and have never raised her rents and never intend to. If I did, she and her disabled son would have been displaced and likely would have to leave Los Angeles.
I have created jobs for a regular housekeeper, gardener, plumber, electrician, and other contractors.
I have raised the curb appeal of the immediate neighborhood with my continued upkeep and renovation of the property.
In just 1 year, I have brought 150+ guests from all over the world to Los Angeles.
We host mostly families, but also bridal parties, friends visiting locals, locals who need temporary housing for their personal reasons (and sometimes emergencies like the recent Woolsey Fire), couples, and traveling businesspeople. Many of these people prefer the personal touch and hospitality of being in a well-managed house where they can cook, do laundry, enjoy special amenities like games and books, baby and toddler-friendly environments, local tips curated by me, and comfortable FREE parking. No hotel can provide this; hotels provide services unique to travelers who prefer that kind of setup - and I do not presume to compete for those guests.
In my guestbook, you will see that are numerous highly satisfied visitors who would never have this kind of experience at a hotel.
I can only do these things because of short term rentals. If these proposed regulations are enforced in their current form, the following will happen en masse to local Angeleno homeowners such as myself:
I will be forced to liquidate my property and suffer a tremendous loss.
The next owner will likely charge higher-than market rents anyway, which does not solve the false, manufactured “problem” of short-term rentals displacing long-term rent-controlled available inventory of real estate in Los Angeles.
I spend about $10-13,000 on local contractors every year to keep the property in prime condition for our guests (Average wage $30/hr). These jobs will disappear immediately. I pay highly competitive wages that are fair and above market rates (which is far more than any union hotel worker might hope to achieve, ironically)
Local tourist revenues to shops, restaurants, and stores will be dampened as tourists will now be forced to stay at hotels that are distant to developing centers of commerce.
The Transient Occupancy Tax (TOT), which has been bringing $100M+ in revenues to the City of Los Angeles, will also disappear. Please note that hotel organizations do not pay this TOT to the City of Los Angeles as AirBnB does.
If short-term rentals are not available for tourists, then hotels will maintain control as a local oligarchy, which allows for price fixing across the board. For instance, when the Olympics, or World Cup comes to Los Angeles, the city fully expects an influx of tourism. However, historical data shows that hotels are even at capacity without these large events. If short-term rentals are out of the picture, one can imagine the price hotels will be able to gouge consumers with during these peak seasons of tourism. Because this will limit the amount of tourists visiting Los Angeles overall, general revenues from tourism will be limited as well.
The truth is that homeowners of short-term rentals represent less than 1% of the overall population of Los Angeles. A common argument presented by the hotel lobby says that short-term rentals are the source of local irresponsible nuisances, and displace rent controlled inventory in Los Angeles. While this argument may hold true for a tiny minority, the vast majority of folks like myself take an active hand in ensuring quality for not only our guests, but for the neighborhoods we operate in. We provide havens that hotels cannot. We do not compete with hotels as guests staying in hotels usually prefer hotels anyway. And we also do not displace rent-controlled tenants, contrary to popular opinion (I’m living there myself - why would I rent my own spot out to a RSO tenant? Where would I go? I bought the house!) For me personally, the revenues from AirBnB make it possible for me to not raise rents for my long-term tenants - and I take great pleasure and pride in knowing I can protect them financially in this way.
Jaime & Gary
Gary, my partner, and I (Jaime) fully support Councilmember Gil Cedillo's motion to allow short term renting in RSO 4 or less buildings. We bought our duplex in 1996 and have lived in one of the units since 1996. We have been renting the other unit of the duplex both as a long term rental and as short term rental since the mid to late 2000's. We are both retired and rely heavily on the STR income to pay our mortgage and maintain the property to keep it in good condition. Without this income, we would only have our fixed social security income which would barely pay our monthly mortgage, much less maintain the property to keep it in good condition which would otherwise result in disrepair (eg. insulation, efficient windows, roofing, landscaping and yard upkeep, etc.). We feel we contribute greatly to the Los Angeles economy when we hosts guests who visit LA and spend their tourist money in local businesses (eg restaurants, shops, laundry cleaners, etc.) The transit occupancy tax (TOT) that we collect from our guests goes directly to Los Angeles general fund that pay for multiple services beneficial to all Angelenos. RSO 4 or less buildings provide more benefit to LA than it is a burden to the rental housing inventory as we only comprise 1% of the housing rental market. We are not opposed to fair regulation of RSO 4 or less properties engaged in STR, that is why we strongly support Councilmember Cedillo's 18-1247 motion.