Short Term Rental Regulations

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Summary of Short Term Rental Regulations: Preliminary Draft for Public Comment

The City has developed a preliminary draft of regulations for short term rentals in Olympia. Review the draft below and tell us what you think using the Comments tab at the bottom of this page.


Definitions

Short Term Rental (STR)– A lodging use that is not a motel, hotel or bed and breakfast, that is offered for a fee for fewer than 30 nights.*

Two Types of STRs: 1) Homestay and 2) Vacation Rental

  • Homestay –A residential use wherein rooms are rented within a dwelling unit that is occupied by a permanent resident. Allowed outright without a permit, as a home-based business that is subordinate and incidental to the main residential use of the dwelling unit.
  • Vacation Rental –A lodging use wherein an entire dwelling unit is rented for overnight stays for less than 30 consecutive nights and owner does not reside on-site. A permit is required for a vacation rental.

Permitting

  • A City permit (and associated fee) is required for each vacation rental unit; biennial renewal required
  • Proof of city and state business licensing for homestays and vacation rental units*
  • Proof of primary liability insurance for homestays and vacation rental units*
  • Remit all applicable local and state taxes.*

Performance Standards

  • Primary resident, property owner, or long-term tenant must reside in a residence containing homestay units.
  • Maximum of three (3) separate vacation rental units in Olympia per property owner. This restriction does not pertain to homestays.
  • Maximum of two vacation rentals per parcel.
  • Vacation rentals permitted in ADUs only if legally established prior to effective date of these regulations. A grace period will be allowed for existing, nonpermitted ADUs to obtain permits.
  • STRs limited to two adults per bedroom, excluding children under 12 years of age, and a maximum of 10 occupants regardless of the number of bedrooms.
  • STRs will be permitted everywhere residential and commercial uses are permitted; prohibited in industrial zones.
  • STRs will be permitted in single-family, duplex, tri-plex, four-plex, townhouse and multi-family units, subject to all other limitations.
  • An additional off-street parking space will be required when renting more than two bedrooms in a dwelling unit – homestay or vacation rental. An additional off-street parking space would also be required if renting two units on a property.

Good Neighbor Guidelines

The following will be required of all STRs*:

  • Local contact 24/7 within 15 minutes of dwelling unit
  • Posted guidelines for guests
  • Posted emergency contacts, floor plan, evacuation plan
  • Posted copy of license and permit number

Enforcement and Oversight

  • Compliance with health and safety requirements – building code, fire code, sanitation, etc.*
  • Violations subject to civil penalties and suspension and/or revocation of license or permit

*Currently required pursuant to Title 64 RCW Chapter 64.37, Short Term Rentals, and City of Olympia Municipal Code.



Why are we doing this?

Currently, Olympia doesn’t have specific regulations addressing short term rentals. City Council has asked staff to take a closer look at these types of rentals to establish equitable and balanced rules for all stakeholders. We will strive to develop a sound process for Olympia that:

  • Aligns with Olympia’s context and priorities
  • Protects public and private interests
  • Promotes fairness
  • Helps meet our social and economic needs

The following six goals represent the underlying principles guiding our planning progress so far:

  1. Housing: Establish protections for the supply and affordability of housing.
  2. Health and Safety: Identify unwanted behaviors and negative consequences.
  3. Neighborhood Integrity: Minimize impacts and tensions between short term rentals and neighbors.
  4. Fees and Taxes: Ensure equitable permit and tax compliance.
  5. Enforcement: Enact enforceable policies that improve building, safety, and accessibility requirements.
  6. Economic Development: Ensure an equitable approach with existing local firms and providers and their employees, and enable revenue opportunities for existing residents.”

How did we get here?

The City received public comment, held community meetings, and conducted research about best practices focused on short term rentals throughout the state and nation. We heard a full range of responses in support and opposed to regulating short term rentals.


Summary of Short Term Rental Regulations: Preliminary Draft for Public Comment

The City has developed a preliminary draft of regulations for short term rentals in Olympia. Review the draft below and tell us what you think using the Comments tab at the bottom of this page.


Definitions

Short Term Rental (STR)– A lodging use that is not a motel, hotel or bed and breakfast, that is offered for a fee for fewer than 30 nights.*

Two Types of STRs: 1) Homestay and 2) Vacation Rental

  • Homestay –A residential use wherein rooms are rented within a dwelling unit that is occupied by a permanent resident. Allowed outright without a permit, as a home-based business that is subordinate and incidental to the main residential use of the dwelling unit.
  • Vacation Rental –A lodging use wherein an entire dwelling unit is rented for overnight stays for less than 30 consecutive nights and owner does not reside on-site. A permit is required for a vacation rental.

Permitting

  • A City permit (and associated fee) is required for each vacation rental unit; biennial renewal required
  • Proof of city and state business licensing for homestays and vacation rental units*
  • Proof of primary liability insurance for homestays and vacation rental units*
  • Remit all applicable local and state taxes.*

Performance Standards

  • Primary resident, property owner, or long-term tenant must reside in a residence containing homestay units.
  • Maximum of three (3) separate vacation rental units in Olympia per property owner. This restriction does not pertain to homestays.
  • Maximum of two vacation rentals per parcel.
  • Vacation rentals permitted in ADUs only if legally established prior to effective date of these regulations. A grace period will be allowed for existing, nonpermitted ADUs to obtain permits.
  • STRs limited to two adults per bedroom, excluding children under 12 years of age, and a maximum of 10 occupants regardless of the number of bedrooms.
  • STRs will be permitted everywhere residential and commercial uses are permitted; prohibited in industrial zones.
  • STRs will be permitted in single-family, duplex, tri-plex, four-plex, townhouse and multi-family units, subject to all other limitations.
  • An additional off-street parking space will be required when renting more than two bedrooms in a dwelling unit – homestay or vacation rental. An additional off-street parking space would also be required if renting two units on a property.

Good Neighbor Guidelines

The following will be required of all STRs*:

  • Local contact 24/7 within 15 minutes of dwelling unit
  • Posted guidelines for guests
  • Posted emergency contacts, floor plan, evacuation plan
  • Posted copy of license and permit number

Enforcement and Oversight

  • Compliance with health and safety requirements – building code, fire code, sanitation, etc.*
  • Violations subject to civil penalties and suspension and/or revocation of license or permit

*Currently required pursuant to Title 64 RCW Chapter 64.37, Short Term Rentals, and City of Olympia Municipal Code.



Why are we doing this?

Currently, Olympia doesn’t have specific regulations addressing short term rentals. City Council has asked staff to take a closer look at these types of rentals to establish equitable and balanced rules for all stakeholders. We will strive to develop a sound process for Olympia that:

  • Aligns with Olympia’s context and priorities
  • Protects public and private interests
  • Promotes fairness
  • Helps meet our social and economic needs

The following six goals represent the underlying principles guiding our planning progress so far:

  1. Housing: Establish protections for the supply and affordability of housing.
  2. Health and Safety: Identify unwanted behaviors and negative consequences.
  3. Neighborhood Integrity: Minimize impacts and tensions between short term rentals and neighbors.
  4. Fees and Taxes: Ensure equitable permit and tax compliance.
  5. Enforcement: Enact enforceable policies that improve building, safety, and accessibility requirements.
  6. Economic Development: Ensure an equitable approach with existing local firms and providers and their employees, and enable revenue opportunities for existing residents.”

How did we get here?

The City received public comment, held community meetings, and conducted research about best practices focused on short term rentals throughout the state and nation. We heard a full range of responses in support and opposed to regulating short term rentals.


Comment on the draft

What do you think about the preliminary draft of short term rental regulations?

You need to be signed in to comment in this Guest Book. Click here to Sign In or Register to get involved

Thank you for your work. As a 8 year business owner of Olybungalows, a short term rental of guest houses I appreciate your consideration of our livelihood. I provide housing to all different demographics and reasons for needing short term housing for people who both reside in and visit Olympia. For the most part I am in compliance and agreement with all of the city's recommendations. I do have concerns about a few of the recommendations. 1) The issue of limiting an operator to 3 properties. I understand the fear that by not limiting units opens up the possibility that many will be operated there by changing the character of neighborhoods but this is just not happening. The market of short term housing will regulate itself and it is such a small percentage of the houing real estate that it seems like a non-issue. Although this recommendation wouldn't effect me personally I think it is unfair to those that it would who are operating successful businesses with more then 3 units to limit their business model. 2) Having a maximum of 10 occupants sadly limits the opportunities of families to visit and enjoy Olympia. Very few short term rentals that are available are large enough to accommodate those numbers. The few that are provide the opportunity for families to gather together. If my family should come for reunion we would need accommodations for 12 or more. I understand the fear of crazy parties but again the short term housing self regulates itself by a system of reviews and responsible hosts. 3) The issue of parking. This would effect me personally. I operate 2 small guest houses (3 bedrooms) on one small urban lot. The homes were built in the 1930's without accommodations for parking. There is zero issue with parking on the street. A blanket recommendation that attempts to overlay current zoning requirements on the built environment of decades past seems unreasonable, especially when it is completely unnecessary. Well those are my thoughts. Thanks for listening, Ellen Olybungalows LLC.

Olyellen 9 days ago

A vacation rental is similar to a hotel in use. I think I could find the local manager contact information if the hotel guests were noisy or creating problems. But since hotels are mostly in commercial areas, this isn't much of a problem. Since there is a constant turnover of people who stay at vacation rentals the potential for intermittent problems is higher. The ordinance should require that managers of vacation rentals periodically notify surrounding neighbors of their contact details. This would make is seem more like they had a constant neighbor, the manager.

KarenM 9 days ago

I am not understanding why you would limit the number of STR a person can have?? Do you regulate the number of rental homes or apartments or businesses a person can own?? I think this should be removed. The rest of the regulation seems workable. Thank you

babypoop 18 days ago

Hello,It looks like you've done a decent job of balancing interests and drafting effective regulations. I come at the regulations from the perspective of a homeowner who cares about the health of my neighborhood.That said, my only concern is that the regulations would allow each property owner up to three rental units. That seems like a lot and could borders on commercial exploitation of neighborhoods and reduce housing. Or perhaps I misunderstand. If the three properties were at the same location (eg a triplex), it seems somewhat reasonable. But if we're talking about three properties at three different locations, I oppose. I feel an owner should qualify to for just one location. If it offers only one unit, so be it. Hal SpencerOlympia

Hal 23 days ago

This sounds like a very reasonable compromise. I particularly am supportive of the limits on how many an owner can have. This will prevent the issues seen in other markets and as we saw with 123 4th Ave.Thank you for all the work and for listening!

Teri Bevelacqua 23 days ago

What is the permitting process for homestays? How do we go about obtaining the permit?

Olyellen 26 days ago