In Working Stiff Partners, LLC v. City of Portsmouth, single-family, two-family, and multi-family dwellings were allowed in the applicable zoning district. The Portsmouth Zoning Ordinance (PZO) defined a “dwelling unit” as follows:
… A building or portion thereof providing complete independent living facilities for one or more persons, including permanent provisions for living, sleeping, eating, cooking and sanitation. This use shall not be deemed to include such transient occupancies as hotels, motels, rooming, or boarding houses. (Emphasis added.)
The Court found that short-term rentals of as little as one day at a time constituted “transient” occupancy and were thus explicitly excluded by the PZO definition from being a “dwelling unit.”
However, many zoning ordinances in New Hampshire have a definition of “dwelling unit” similar to Portsmouth’s definition except that they do not expressly exclude transient occupancy. The Court’s decision thus leaves open the question of whether short-term rentals may be prohibited where the local ordinance definition does not expressly exclude transient occupancies.
There were other facts in the Portsmouth situation which may have influenced the Court’s decision. The property in question was advertised on Airbnb as allowing occupancies of as little as one day; and was also advertised as being suitable for “family parties, wedding parties, and corporate stays.” The Court may have reached a different result if the property in question could only be rented for longer periods of time (e.g., a minimum of one week), or if the property’s use did not include wedding parties, corporate stays, and other events, but was limited to single-family residential usage.
Thus, while the Court’s decision appears to allow municipalities to regulate short-term residential rentals, municipalities may not want to prohibit them, or may only want to prohibit them in specific zoning districts, or may only want to regulate them, for example:
- By allowing short-term residential rentals but prohibiting wedding parties, corporate stays, or other commercial uses; or
- By requiring residential rentals to be a minimum duration (say, one week); or
- By requiring short-term rental owners to register as such and be subject to inspections for health and safety purposes.
Whatever municipalities decide, they should consult counsel to make sure that their zoning definitions and provisions accomplish the result they want to achieve.
