Winnetka Weighs Stricter Short-Term Rental Rule

Winnetka officials are considering a ban on short-term rentals on websites like Airbnb and Vrbo.

The village currently prohibits short-term rentals because they aren’t defined as an allowed use in the zoning code. But village staff suggested developing a more robust policy on short-term rentals after they found a property offering stays on Airbnb, according to documents from the Board of Trustees’ Tuesday meeting.

During the discussion on Tuesday, most trustees supported banning short-term rentals shorter than 60 days with exceptions built in for informal agreements between neighbors or accommodations for existing residents. The board directed Village Attorney Peter Friedman to draft a new ordinance that trustees will consider at future meetings.

The village is joining a growing list of Chicago suburbs that are introducing new bans or strengthening existing regulations on short-term rentals within their borders, citing noise and nuisance complaints, as well as the potential to drive up housing costs for long-term rentals and residential buyers.

Skokie introduced a pilot program in February to ban new short-term rentals, while Evanston passed an ordinance later that month setting a cap and regulation framework for short-term rentals in the city. Arlington Heights enacted a ban in March.

The policy would put Winnetka in line with many of its North Shore neighbors. A staff memo included in meeting documents outlined specific policies prohibiting short-term rentals in nearby communities including Barrington, Northfield, Hanover Park and Lincolnshire.

Some other North Shore suburbs, like Glencoe and Wilmette, prohibit short-term rentals, but do not have a specific ordinance, according to the memo.

During Tuesday’s meeting, the board discussed how to tailor the policy to target short-term rentals by commercial owners and homes hosting frequent tourists, rather than informal stays between neighbors or friends.

Winnetka, which has among the highest housing costs in the Chicago metro, has many residents who have second homes elsewhere or spend only part of the year in the village. Village trustees said in some cases homeowners will let the guests of neighbors stay in their house when they’re away, and they did not want to criminalize those situations.

Other times, residents may rent for a short period while their homes are being remodeled or before moving into their home full-time, trustees said. Trustee Rob Apatoff suggested providing exceptions for Winnetka residents to allow for those situations.

“I would definitely give some consideration to Winnetka residents if [they] or their family will be moving in for a short term for some reason,” he said.

Trustee Tina Dalman suggested setting occupancy limits to two people per bedroom to prevent even longer-term rentals from being used as party houses or event venues.

“If a family rents a house, fine, if they rent it for 30 or 60 days, whatever we land on, fine.” Dalman said. “But it also prevents these de facto party houses, ‘girls gone wild,’ ‘guys gone wild’ situations.”

For rentals that are allowed, trustees also said they want mechanisms to identify the operators of LLCs offering high-end rental housing in the village.

“Oftentimes people are setting these up as LLCs, single-purpose entities, and then we have no visibility as to who to contact, what to do if there’s something that does go wrong,” Dalman said.

In Glen Ellyn, a full ban on short-term rentals is being legally challenged by an Airbnb operator. In December, a federal judge blocked Glen Ellyn from enforcing its ban against the company suing the village, while allowing the village to enforce the ban on other properties.