Proposed ban on short-term rentals shakes up tourist town

In the global cat-and-mouse game of regulating home sharing, one North Fork village has a new way of toying with its prey.

Greenport, a former whaling town that has become a popular weekend destination for New Yorkers, already has a 14-day minimum for rentals. But its code committee now wants to make it 30 days, and to close loopholes that have allowed owners who occupy their homes while renting rooms to host for as little as a weekend.

Mayor Kevin Stuessi said the committee might be trying to align Greenport’s rental rules with the East End’s as a whole. But only Riverhead has a 30-day minimum. Greenport’s other rationale is to eliminate “investor zombie homes,” as Stuessi calls rentals left empty in the off-season.

But locals say they are baffled by the idea that a longer minimum stay would fill homes through the winter, and those who rent out their homes say it won’t make them year-round landlords. Instead, they warn, it will cost them — and the village — money.

Some claim it would prompt them to sell to second homeowners, making the area even less affordable and more of a ghost town in the offseason.

And even the mayor suspects that the village board is really trying to eliminate a certain kind of visitor.

“Some of the investor zombie homes end up with these groups of folks who come in and are noisy and they don’t have the same level of care and attention somebody who lives in a neighborhood does about their home,” he said.

“We can’t go back”

John Kramer has been on the North Folk of Long Island his entire life. He’s seen it transform from an agricultural area dotted with potato farms to a weekend getaway destination.

“Now we’re a tourist town,” he said. “We can’t go back.”

Kramer renovated a three-family home in Greenport, moved into the ground floor and listed the two upstairs apartments on Airbnb. As an owner-occupant, he qualifies for the exception to the 14-day rule and can rent his rooms for any duration.

“Some of the investor zombie homes end up with folks who are noisy and don’t have the same level of care.”
Greenport Mayor Kevin Stuessi

If the new proposal were to pass, Kramer said, he would lose about $50,000 in Airbnb rentals annually. That would likely force him to cut back on landscaping, window cleaning and other home maintenance that employs local businesses.

“It’s not whaling anymore in Greenport, it’s tourists coming out.” Kramer said. “If you take that away, I’m going to suffer. And if I suffer, the restaurants, the businesses in Greenport Village are going to suffer.”

An Airbnb spokesperson emphasized the economic benefits that home sharing brings to Greenport, including money spent at local businesses. “We welcome the opportunity to work with the Village of Greenport on fair, balanced rules that provide certainty and clarity for hosts and continue to bolster the local tourism economy,” the spokesperson said in a statement.

Forced sales

Luigi Racanelli and his wife might end up flipping the Greenport house they bought last February for $872,000.

Racanelli, a New York City resident, dreamed of spending more time in the village, which features marinas, charming shops, popular restaurants and a carousel. He has lived there almost full-time since March.

But when he and his wife lost their jobs, they began to consider renting their new place for short stays. If those bookings were banned, though, they might have to unload it.

“If it was between renting a full year or selling, I’d probably err on the side of selling,” he said. “One, I don’t think the income for a full year would cover my mortgage, and two, I came out here so that we could enjoy the area, enjoy the community and have a backyard for our daughter.”

A full-year lease would render the house off-limits to the family.

The 30-day minimum might bring properties like Racanelli’s onto the market for sale as second homes to people who don’t need rental income, according to Compass agent and local resident Bridget Elkin. Many were listed in 2018 after Greenport imposed the 14-day limit, she said.

“Would there be a small bump in supply? There would, but that bump is going to be quickly absorbed by a second homeowner that doesn’t need to rent,” Elkin said.

She added that enforcing the current rule, rather than changing it, could solve the village’s issues.

Local broker David Kapell said Greenport has already been losing two-family homes as buyers restore their original single-family configurations to use as primary or second homes — a trend that the 30-day rule would accelerate. “So you actually lose housing supply,” he said.

Stuessi said that criticism of the plan, including at two public hearings, has prompted the village board — on which he sits — to revisit the proposal. The members will likely look for a policy that distinguishes between absentee investors and what the mayor terms “respectful” local owners — people like Kramer — who live on-site.

Any changes would take effect in 2025.