After a pandemic-era dip, the number of short-term rentals in Vermont has skyrocketed, especially in ski towns like Stowe, Ludlow and Killington.

According to a study by the Vermont Housing Finance Agency, the nmumber of short-term rental units rose 16 percent in 2023, to nearly 12,000. And the debate over how to regulate them has grown louder too, with some towns worried they are contributing to the state’s affordable housing shortage.

“That has resulted in towns having to have conversations at select board meetings and planning commission meetings,” said Ted Brady, executive director of the Vermont League of Cities and Towns. 

State lawmakers have allowed towns and cities to govern short-term rentals themselves. That has led Burlington to ban over 80 percent of its existing short-term units. Now, citing systemic problems, others are ready to follow suit.

“Noise, parking, and sometimes it’s more on the larger issues like the housing shortage,” noted Carin McCarthy, president of the Vermont Short Term Rental Association board of directors.

McCarthy, who owns Vermont Bed and Breakfast at Russell Young Farm, said her group welcomes a larger conversation around short-term rentals, but more research is needed before concluding that they cause problems in the housing market as a whole.

“Rather than taking the approach of banning, like Burlington, without further information, we suggest that towns study what’s happening,” McCarthy said. “It’s easy to point a finger, there’s a lot more to it.” 

McCarthy said Airbnb and Vrbo rentals are vital to the state’s tourism industry, which benefits the state and local economies.

But while there is no specific research connecting the housing crisis to the short-term rental market, Ted Brady says it’s common sense.

“The thousands of short-term rentals across Vermont are thousand of units that are not being used to house people long-term,” Brady said. “That is an obvious fact.”  

Brady does acknowledge that short-term rentals are just one piece of the puzzle that is Vermont’s housing shortage. He says aging infrastructure, local zoning restrictions and statewide land-use regulations, such as Act 250, are major factors.

“In order to have more housing built in Vermont, we’re going to have to touch Act 250,” he said. 

McCarthy and Brady do agree that any regulatory decisions made by cities and towns will likely lead to litigation. And the result of the legal action will add more clarity to the issue of how they should be governed.