Nashville To Phase Out Some Short-Term Rentals, Decisively Ending Its Yearlong Battle

Given several options, Nashville’s council on Tuesday chose a more aggressive approach to reducing — but not completely banning — short-term home rentals.

The vote follows a year of intense debate and epic public hearings, but the final tally by the Metro Council wasn’t close, handing neighborhood activists a resounding victory.

The bill that ultimately passed says that over the next three years, Nashville will phase out short-term rentals from residential neighborhoods in cases where the owner doesn’t live on that property — also referred to as “non-owner-occupied” or “investor-owned” properties.

That means that anyone who uses Airbnb to offer a spare room in a home — or a service like HomeAway to offer a vacation rental while they’re out of town — those are still allowed. And in high-rises and urban, mixed-use areas, short-term rentals will continue.

“This initially started out as a way for people to make some money on the side … but as it became quite apparent, we had a lot of out-of-state and out-of-county investors coming in and buying these up,” said Councilman Larry Hagar, who sponsored the measure.

He and other members noted a sizeable public outcry against “mini hotels” in neighborhoods. And Mayor Megan Barry, in a statement following the vote, praised the council for its work on the policy.

“Neighborhoods should be for neighbors, and I hope these new regulations will help correct some of the unintended consequences of non-owner-occupied short-term rental properties,” Barry wrote. “My administration will continue working with appropriate departments and agencies in Metro to strengthen enforcement of our rules.”

Yet the short-term rental industry, which lobbied against the measure, quickly blasted the outcome in statements. HomeAway called the vote a “lose-lose” and Airbnb said it’s considering “all options to defend our host community.”

Council members, including Jeremy Elrod, expect the industry to swing its clout toward the state legislature to try to override Metro.

“I don’t want it to be preempted,” he told his colleagues. “I hope that I am wrong about the state legislature.”

Others argued that state action isn’t a given, noting that cities like Hendersonville and Knoxville already have stricter regulations than what Nashville had.