With only a few months remaining in the 2015-2016 legislative session, the WRA is actively pursuing several of its remaining legislative priorities. One of those priorities is legislation known as “Right to Rent” legislation that would protect the ability of homeowners to rent out their homes for seven days or longer.

Under the proposed legislation, local municipalities could not prohibit the rental of single-family homes for seven days or longer, but they could still (a) ban the rental of homes for less than seven days, and/or (b) allow municipalities to impose reasonable regulations on all rentals regardless of the rental period. Examples of such regulations are registration requirements, fees, inspections or nuisance regulations.

The legislation is being proposed in response to a growing number of communities in Wisconsin and throughout the country that are banning home rentals for a time period of less than 30 days. Wisconsin has a strong second-home real estate market where many people have purchased second homes as an investment with the intention of renting them out on a seasonal basis to generate income or to help pay for ownership costs. Banning the rental of homes by ordinance undermines the investment-backed expectations of these homeowners and prevents them from using the property for the primary purpose for which they purchased it. Moreover, without the ability to rent, prospective homebuyers may be less likely to purchase homes in these areas, which could negatively impact the prices and/or marketability of these homes. 

Member survey results

Before introducing the legislation, the WRA was asked to survey its membership to determine the level of support for this initiative. Some were concerned that REALTORS^® did not understand the proposal or the impact it would have on the ability of local governments to prohibit home rentals in some parts of the community. 

Accordingly, the WRA conducted a membership survey in November 2015 and received over 1,400 responses, which was the highest number of responses received for any prior WRA member survey. The responses received were from a broad mix of REALTORS^® based on gender, age, years in the business, political party affiliation, geographic area and license type — such as brokers, salespeople and appraisers.

The survey responses were strongly in favor of the Right to Rent legislation. When asked whether they thought local governments should be able to require certain minimums regarding the length of stay when renting private property, 77 percent responded “no” that they did not think local governments should be allowed to require minimum length of stays, while only 23 percent were in favor. When asked how interested they were in this legislation that would allow all homeowners to rent their homes for one week or longer subject to local regulations such as noise, parking, registration and licensing fees, 75 percent responded that they were interested, with 28 percent saying they were very interested. 

With respect to their level of support for the proposed Right to Rent legislation, 76 percent of the members indicated that they supported the proposed legislation, 11 percent indicated they oppose and 13 percent stated that they didn’t know. 

The support was strong among all regions of the state:

• Milwaukee: 63 percent support, 18 percent oppose.
• Madison: 58 percent support, 18 percent oppose.
• Fox Valley: 63 percent support, 13 percent oppose.
• Wausau: 63 percent support, 18 percent oppose.
• Western Wisconsin: 64 percent support, 13 percent oppose.

The support for Right to Rent legislation was also strong among all types of members

• Residential practitioners: 62 percent support, 16 percent oppose.
• Commercial/industrial practitioners: 72 percent support, 9 oppose.
• Property management practitioners: 68 percent support, 10 percent oppose.
• Appraisers: 50 percent support, 25 percent oppose.

When asked whether they thought homeowners should have the right to rent out their homes for one week or longer with or without being subject to local regulations, 58 percent indicated that homeowners should be allowed to rent out their homes subject to local regulations, 34 percent indicated that homeowners should be allowed to rent out their homes without being subject to any local regulations, and only 8 percent said they should be allowed to rent out their homes only if the local government allows them to do so.

In a head-to-head question, asking whether local governments should be allowed to regulate short-term rentals through regulations related to noise, parking, registration or fees, or ban short-term rentals in the community, 89 percent indicated they preferred giving the local governments the right to regulate short-term rentals, while only 11 percent preferred giving local governments the right to ban short-term rentals.

The member survey results showing strong support for the Right to Rent legislation was consistent with the opinions expressed by REALTORS^® over the years as well as the opinions of the WRA public policy committee and board of directors. Accordingly, the WRA will continue to pursue legislation this session to protect the ability of homeowners to rent their homes for seven days or longer.

Tom Larson is Senior Vice President of Legal and Public Affairs for the WRA.