During a Nov. 9 public comment session, Houston resident Susan Sajadi recounted an incident where she heard gunshots coming from an Airbnb close to her home and how nothing was done about it.
“Unless there is a body in the street or somebody is killed, that is what it’s going to take to actually get somebody to do something,” she said.
City officials met in April to start the process of gathering information on short-term rentals in Houston, and over the course of nine months have put together a potential plan to regulate the market.
Mapping it out
Bram Gallagher, director of economics and forecasting at AirDNA, a software company that analyzes short-term rental data, said Houston markets have experienced a steady rise in STRs over the past five years.
In the Heights, River Oaks and Montrose areas, there were approximately 2,028 listings as of October. In October 2019, there were 1,660 listings—reflecting a 22% increase.
The most concentrated number of homes rented out were in the 77006 ZIP code along Montrose Boulevard and Westheimer Road. The most rented units contain one or two bedrooms.
“It’s not incredibly shocking or dramatic growth over the last five years, but it’s strong year-over year-growth,” Gallagher said.
However, while he said listings have not increased significantly, the revenue has tripled in the last five years. In October 2019, 1,660 listings brought in about $1.8 million in revenue with an average occupancy rate of 59%, which is the percentage of available space that is being used. In 2024, the 2,028 available listings accumulated $4.8 million with a lower occupancy rate of 54%.
Gallagher said the increase is due to a rise in rates. In the five ZIP code areas, the average daily rate is $198.53 per night, according to AirDNA data.
After a public comment session in March where nearly 40 residents had complaints on STRs, City Council members Sallie Alcorn and Amy Peck requested the administration evaluate the feasibility of registering or permitting STRs in Houston.
By April, the Administration and Regulatory Affairs Department started to gather data and facts to develop potential regulations. Julian Ramirez, Quality of Life Committee chair and an at-large council member, said regulations could require STR owners to register their properties with the city.
“Hosts will be required to keep the registration current and will have to pay insurance and a fee of some kind,” he said. “If they fail to do any of these things, there will be a penalty between $100-$500 for each violation.”
Ramirez said there could also be provisions under which a registration can be revoked, including:
- If false information was provided in the application
- If important changes were not reported to the city
- If there are two or more instances when the city had to lessen a nuisance
- If there are two or more citations that resulted in two or more convictions for violations
- If someone who is staying at an STR or the owner was convicted of a listed criminal offense
The proposed regulations need to be approved by Houston City Council before moving forward and are subject to change.
In comparison
Ramirez said one Texas city that the committee studied for possible short-term rental regulations was Arlington.
Arlington City Council passed an ordinance regulating short-term rentals in April 2019 with the provision that only permits short-term rentals in certain zones, mostly near the entertainment district. Hosts and property owners also must obtain a valid short-term rental permit from the city and pass a safety inspection of the property.
However, Ramirez said city officials wanted to make sure that their regulations were legal and reasonable for Houston homeowners and avoided a similar situation that happened in Austin.
Austin originally adopted rules in 2016 governing short-term rentals. However, federal courts ruled in 2023 that the city’s rules were unlawful.
The capitol city's ordinance included requiring short-term rental owners to obtain an operating license annually and did not allow homes to be rented for less than 30 consecutive days.
What they're saying
Houston City Council members Abbie Kamin, District C, and Sallie Alcorn, at-large position 5, both said while the city is looking to regulate the short-term rental market, they are not looking to restrict homeowners too much.
“I am in favor of reasonable regulations that do not impede on the average Houstonian’s ability to rent their homes, but we have to find a way to address the bad actors that are creating a problem for everyone," Kamin said.
Alcorn echoed her statement.
“We don’t want to discourage the responsible short-term rental owners, and I think these regulations won’t, but this is a way for the city to have some kind of control," she said.
Measuring the impact
Ursula Jessee, an Airbnb host in the Greater Heights, said she started operating a short-term rental three years ago after a cancer diagnosis and a newborn baby made her look at her life differently.
“I wanted to spend more time with my family, so I started to think about what would enable me to do that,” she said. “Then I happened to fall into hosting.”••According to Airbnb data, the average host in Houston earned approximately $8,700 in supplemental income in 2023.
An internal survey of Houston in 2023 from Airbnb showed:
- 56% of hosts used the additional income to keep up with the rising cost of living.
- 42% used the money to cover food and other basic expenses.
- 10% said it helped them avoid eviction or foreclosure.
“It brings me a lot of joy being able to help people—be it difficult times or happy times,” she said. “I know that short-term rentals seem to get a bad reputation, but I would argue that 95% of us are just regular folks helping families find somewhere to stay and be safe and happy.”
Looking ahead
The proposed short-term rental regulations will return to the Quality of Life Committee on Dec. 9 at 2 p.m. for discussion. The meeting is open to the public and will include an opportunity for public comment.
Ramirez said once a draft is finished, the proposal will need to be placed on a future City Council agenda. He said the committee is aiming to have the final regulations presented to the council by the end of 2025 or early 2026.
