OKLAHOMA CITY (Free Press) — In the midst of an ongoing and potentially worsening crisis in the availability of housing across Oklahoma City, there has been an undeniable surge in the number of homes used exclusively for short-term rentals, or “homeshares,” centered primarily on industry leader Airbnb.
In a previous article, we looked at the complications that city officials are facing in the effort to better license and regulate this exploding industry, and at the difficulty of cracking down on the unprecedented number of “ghost rentals” in The Village, completely unlicensed short-term rental houses listed openly on Airbnb and Vrbo.
The numbers for the whole of OKC are even more surprising.
According to the City of Oklahoma City Department of Development Services, the body that handles licensing of homeshares, there are currently 432 active homeshare licenses in the city.
Airbnb’s website lists more than 1,000 available rentals across OKC.
When reducing the parameters to include only “entire house” rentals, in which the owner is not present on-site, that number still comes in at around 800 rentals.
Compare that to a city of similar demographics like Fort Worth, TX, which has a higher population by nearly 250,000 residents and only shows roughly 600 available homeshare rentals.
The 2022 Point-in-Time Count of homeless persons determined that the metro is currently lacking, conservatively, around 4,500 homes to meet the demands of the unhoused population, a demographic wildly increased by the ending of pandemic-era eviction moratoriums.
So why is more than 15% of that needed housing off the sale or rental market entirely and sitting empty, silently awaiting weekend travelers and out-of-state visitors?
Removing these homes from the market in favor of homesharing creates the obvious effect of reducing the supply of available housing, but may also be contributing to the skyrocketing house prices across the city.
Over the past year, it’s estimated that housing prices in OKC have risen more than 18% as the shortage of available housing drives up the value of the remaining supply.
As Oklahoma boasted comparatively low property rates and housing costs in recent years, the state became fertile ground for out-of-state investors and fledgling moguls, many of whom moved to buy up properties specifically for homeshares.
“We had a lady at our City Council meeting last night that evidently owns seventeen Airbnbs,” The Village City Councilman Sean Cummings told me, “and she was looking to buy three more in The Village.”
This is what is known as a “commercial host,” a single owner that holds multiple homesharing properties, all but ensuring that none of them are the host’s primary residence as intended by Airbnb’s all-but-official “one host, one home” policy.
“As far as these people eating up the housing stock,” Cummings continued, “we’ve had houses in The Village going on the market and selling in one day, a lot of them with no inspections or anything, just really bizarre closings. But that’s just the way it’s going, and there’s nothing we can do about that. What we would like to prevent is somebody owning ten of these at once, but then the challenge is that they can just put a ‘strawman’ owner in there and make it look like ten different owners.”
Ohio-based investment firm ReAphla announced last year that they planned to spend $1.5 billion to buy up low-cost housing across the country in cities like OKC for the sole purpose of creating up to 5000 new homeshare properties, specifically capitalizing on newly vacated homes caused by federal foreclosure pauses ending.
According to Realtor.com, It is estimated that out-of-state investors currently make up as much as 11% of Oklahoma City’s homebuyers.
As builders struggle to meet demand, one repeated roadblock to housing the city’s population is the decision to turn new and newly renovated houses and units into homeshares rather than putting them on the market for sale or long-term rent.
Already homes in the still-fresh Wheeler District are being listed on Airbnb, and there are even homes being built specifically to be homeshares.
“There’s been a big controversy over in Linwood,” said Georgie Rasco, Executive Director of the Neighborhood Alliance of Central Oklahoma. “They tore down one of the old beautiful homes over there and a builder came in and built two homes on that one lot. One of them sold but the other one they’re turning into an Airbnb. For one thing, they never, ever should have been built in that way, but it almost feels like they were building it to be an Airbnb.”
It’s not only brand-new builds, either. With the amount of visible effort being put into renovation and rejuvenation around the city, many residents are disappointed to see newly refurbished units marketed to short-term visitors rather than city inhabitants.
“They remodeled all of those old apartments just off 39th Street,” Rasco said, “and the hope or desire is to turn all of those apartments into Airbnbs. They’ve already gotten permission to do at least three of them as Airbnbs, but in their presentation they said they might do the whole apartment complex as Airbnb for people coming to visit the Gay District, which is wonderful for the district, but I was really happy when I saw that they were being remodeled and could be some really nice and affordable housing. But, there they go as Airbnbs.”
Airbnb claims that their platform is built for – and predominantly used by – homeowners that want to rent out unused spaces in their own homes. Though they admit that there are quite a few hosts on the platform that keep dedicated houses and apartments purely for short-term rentals, they say they do not believe that to be the primary use of their site.
It’s easy to see that the facts show otherwise.
Of the more than 1,000 listed homeshare rentals in the City of Oklahoma City, only around 200 are listed as “private room,” and none are listed as “shared room.” The overwhelming majority are entire houses intended for short-term rental use.
Though a license for a rentable room inside your primary residence can be applied for easily, holding an entire house for a homeshare requires a “special exception” from the OKC Board of Adjustment, a process that involves appearing before the board at the City Council chambers.
With more than 700 “entire house” rentals available in OKC just through Airbnb alone, the Board of Adjustment has granted only around 200 special exceptions since 2019, with just 31 more currently awaiting approval according to Board of Adjustment Clerk Cynthia Lakin and Meagan Armstrong in Development Services.
Everyone that was interviewed for this piece also acknowledged the potential benefits of Airbnbs and homesharing, from the opportunity to provide short-term housing for students and badly needed traveling nurses to the aesthetic benefits of rejuvenating old or neglected properties.
But given the currently dire situation of OKC’s housing market, coupled with the unmitigated boom in unlicensed and unregulated homeshares, the industry as it stands in our city may be doing significant social damage at the neighborhood level, especially considering how enticing the process can seem for investors and landlords.
“Yes, it’s easy for a flipper to build an HGTV type house that doesn’t have to take a lot of wear and tear, because it’s just going to be occupied maybe on the weekends or maybe ten days out of the month and make more money at that than they do if they rent it out to somebody and then have to totally remodel it every two years because a family lived there,” Rasco said. “So the cost of what somebody makes with an Airbnb is what draws them to wanting to do that, but it does not help with the problem we have of finding affordable housing for families and people in Oklahoma City.”
Last Updated September 18, 2022, 8:15 AM by Brett Dickerson – Editor
“Brett Fieldcamp has been covering arts, entertainment, news, and culture in Oklahoma for nearly 15 years, writing for several local and state publications. He’s also a musician and songwriter and holds a certification as Specialist of Spirits from The Society of Wine Educators.”
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