Today, I do not envy the New Orleans City Council as they once again tackle the biggest problem in NOLA. It’s not crime (violence, murder, and crime capital of the world), not the streets and infrastructure, not the failing education system (although not under their control, the council can create a jobs training program), not the ability to attract business due to an unfriendly maze of bureaucracy, no, nothing that serious, rather short-term rentals.
I wish I was joking, but the minority drum rattlers who have partnered with the affordable housing interests like to continue to attack the system, which thanks to several terrible actions of the former councilmembers and staff, have caused this single issue to continue to be brought forth. For the record, there is no evidence that STRs impact affordable housing. This was confirmed by multiple affordable housing advocates; however, it sounds good so why bother with the truth.
And then there is the U.S. Fifth Circuit Court of Appeal which found the City’s ordinance, from the former council, contained an unconstitutional provision that provided you must have a homestead exemption in order to have a residential permit; meaning you had to live at the address. I believe several of my colleagues may have mentioned that the provision was unconstitutional, but as Shakespeare’s famous quote states, “first we kill all the lawyers.” Regardless, the decision has also been widely misinterpreted by both sides of the argument.
All of that leads us to today because a Federal Judge ordered a new policy to be in place by March 31. Where that deadline may seem plausible, it forced City Planning Staff to rush through meetings, community engagement (akin to Jerry Springer episodes), and research to provide an “updated” or “new” residential STR ordinance. Note the unconstitutional provision only affected “residential” STRs.
In the interim, as if there was not enough instability in real estate and the STR industry, we have experienced the use of the Interim Zoning District (“IZD”) to block additional commercial STR applications.
Some colleagues and I have spent weeks meeting with city planning staff, councilmembers, and their staff trying to assist in modifications that were fair and balanced, particularly in the area of enforcement. (That merits its own post.)
Today, as I have said many times over the past few weeks, no one is walking away happy, and, in fact, today, I predict that the group that suffers the most loss is the entrepreneurs that have been engaged in the business for years. Today, we will watch the further death of those individuals who rely on that income to subsidize the high property taxes, insurance rates, and living.
My recommendation, sell, and purchase in Bay St. Louis, Mississippi. Your investment will be welcome; it is not the murder or crime capital, it is clean (it has regular garbage pickup), and it is business-friendly. And just as important, you don’t have to deal with laws that are in a constant state of change. I love NOLA, but it can’t seem to get out of its way.
