WASHINGTON (March 16, 2016) – As services like Airbnb and HomeAway grow in popularity, a new study from the R Street Institute of 59 of the largest U.S. cities finds Galveston, Texas and Savannah, Georgia to be the most open to these innovative short-term-rental (STR) services.
R Street’s “Roomscore” report grades cities in multiple policy areas, including whether they tailored their regulatory framework to allow space-sharing services;, what legal restrictions are in place to curb short-term rentals; and how tax-collection and licensing requirements are enforced.

The study assigned a grade of “F” to 10 cities, with Atlanta, Denver and Oklahoma City tying for the absolute lowest score of 50 points. Each of the failing cities either have laws on the books that largely ban short-term rentals or make STR impossible, in practical terms.

“An overview of the legal frameworks that local jurisdictions have adopted to regulate short-term rentals shows a policy environment that is ‘immature,’” said the study’s author, R Street Senior Fellow Andrew Moylan. “This is similar to what we saw two years ago in our first report about local rules for ridesharing. The number of cities and states that have created regulatory frameworks in the time since has grown by leaps and bounds.”

R Street also created a user-friendly website at roomscore.org, which details the study’s methodology and offers a breakdown of the grades for all 59 cities.

“As the popularity of STRs continues to rise, it will be incumbent upon legislators to focus not on rules that protect dominant market players, but instead on addressing basic public-policy interests,” said Moylan. “With simple rules in place, regulators can ensure that competition happens in the open marketplace, not in the back rooms of city councils or state legislatures.”