Column: Home-sharing stimulates Michigan economy

Christina Sandefur

The state of Michigan spends tens of millions of taxpayer dollars annually to boost tourism, but the investment hasn’t been paying off. For every dollar Michigan taxpayers spend on tourism promotion, they lose 98 cents and create only 2 cents of value for the hotel industry, according to the Mackinac Center for Public Policy. But there is another way — one that won’t cost taxpayers a penny.

The “sharing economy” has opened new opportunities for travelers who want to get a better flavor of local communities than they would by staying at traditional hotels. By partnering with home-sharing companies like Airbnb or HomeAway, homeowners can rent out rooms or houses to travelers, which helps them make money, pay their mortgages and improve their local economies. Consumers benefit from more choice and lower prices, and communities benefit by welcoming visitors to support local businesses.

The results are astonishing. Today, Airbnb alone offers more rooms than major international hotel chains like Hilton and Marriott. In 2016, Michiganians earned more than $25 million and brought 188,000 visitors to the state by sharing their homes on Airbnb. That same year, more than half of Michigan homeowners who rented their homes on HomeAway generated enough rental income to cover 75 percent of their mortgage.

But city bureaucrats nationwide are cracking down on homeowners’ right to host overnight guests in their homes. In some places, it’s a crime — punishable by tens of thousands of dollars — to let someone stay in your guest room overnight.

These bureaucrats contend that home-sharing leads to noisy neighborhoods and too much traffic. But banning home-sharing entirely is far too broad to address these problems: After all, we don’t ban backyard barbecues just because some get noisy, or prohibit graduation parties because they can make parking difficult. Communities should enforce reasonable restrictions on noise and traffic via nuisance laws, but they should also respect homeowners’ property rights, including their right to let people stay in their homes for a fee.

Not only do crackdowns on home-sharing hurt homeowners who need extra cash to pay their bills and local businesses that are patronized by visitors, but they encourage neighbors to spy on one another and require police to spend time on petty squabbles. In Honolulu, Hawaii, the government has spent tens of thousands of dollars hiring officers to peek over people’s fences and interrogate tourists to ensure that property owners aren’t letting paying guests stay the night. In Santa Monica, California, officials spent half a million dollars creating a full-time task force to enforce its home-sharing ban — and managed to convict just one homeowner, fining him $3,500.

Fortunately, not all states are spending taxpayer money to drive away visitors and turn homeowners into outlaws. Last year, Arizona passed landmark legislation based on a model drafted by the Goldwater Institute that protects home-sharing statewide. The law allows cities to enforce rules against excessive noise and parking violations, while forbidding the one-size-fits-all bans that hurt local businesses and violate property owners’ rights.

Michigan lawmakers should see home-sharing for what it is: an opportunity to benefit homeowners, travelers, and the economy. And they have the chance to do it with House Bill 4503 and Senate Bill 329 — legislation that stops local governments from passing blanket bans on home-sharing, while still allowing communities to enforce nuisance rules that ensure quiet, clean, and safe neighborhoods.

Michiganians have always defined themselves by entrepreneurship and warm hospitality. Home-sharing combines these two. By passing this legislation, the Great Lakes State can embrace its changing economy, protect property rights, and give homeowners a better shot at the American Dream.

Christina Sandefur is executive vice president of the Goldwater Institute.