Two fishermen motor past the fishing boat Money Shot at it is tied up at the Stonington Fish Pier in Stonington, Maine, on Monday, Dec. 21, 2020. Credit: Bill Trotter / BDN

Stonington will decide whether and how to regulate short-term rentals as the number of vacation rental properties has surged in recent years and year-round housing has become more scarce.

The town’s select board agreed last month to form a task force to look at the effects of short-term rentals on the community and examine ways to regulate them. Town officials are working to bring together people with varying backgrounds and areas of expertise to study the issue.

The move makes Stonington the latest Maine community, including many along the coast, to weigh regulations amid rapid growth in vacation rentals that has made it more difficult and more expensive for others to find year-round housing. That scarcity has ripple effects, as workers have to live farther away from the island communities, which in turn affects the island’s year-round economic vitality, school enrollment and tax base.

In neighboring Deer Isle, administrators of the Island Nursing Home said a lack of available housing for employees was one reason for its closure this fall.

The number of Airbnb listings in Stonington and neighboring Deer Isle grew from three to 298 between 2012 and 2018, according to a 2019 study commissioned by Island Workforce Housing, a nonprofit dedicated to creating affordable housing on the island the towns share.

“It’s to the point now, with vacation rentals having completely overtaken year-round rentals, that there’s nowhere to live,” said Peter Roth, a member of Island Workforce Housing’s board of directors. “People just can’t find a place to live and if they can, it’s a seasonal rental.”

The area lost 73 year-round housing units between 2010 and 2017 while the number of seasonal units grew by 223. Seasonal properties make up 46 percent of the housing stock, a higher share than all of Hancock County (35 percent), Maine (17 percent) and the U.S. (4 percent).

The scarcity of year-round housing hits Stonington’s young workers especially hard, often pushing them to move farther away from the area. Nearly a third of the workers on Deer Isle and Stonington commute from other places, with some traveling from as far as Bangor, according to the 2019 study. That figure doesn’t include self-employed workers and contractors, who make up a large part of the island’s workforce.

This is the first time Stonington has waded into the possible regulation of short-term rentals, and Select Board member Evelyn Duncan said she hoped the task force, once formed, would help the town answer questions about the rising number of short-term rentals.

“Is it on track? Is it too much? Is it hurting anything?” she said.

Across the water, Bar Harbor recently implemented new regulations on vacation rentals. The tourist hotspot put a cap on the number of non-owner occupied rentals and won’t allow rental licenses to transfer to new owners unless the town dips under the cap. A local real estate agent is now challenging the new regulations in court, though largely over procedural issues.

The politics and economics around short-term rentals in coastal Maine can be tricky, Deer Isle Town Manager James Fisher said.

Many families have owned rental properties for generations, and websites such as VRBO and Airbnb have enabled them to book their properties more efficiently and gain rental income, he said. But the phenomenon also has probably encouraged non-residents and rental companies to scoop up homes in the area.

“The net effects are mixed,” Fisher said.

Short-term rentals can drive up property values and property tax revenues for the towns where they’re located. The rentals can also create jobs, and local businesses can benefit from the tourists they bring to town. But if short-term rentals displace people who can’t afford to buy or rent more costly properties, they’ll look elsewhere to live, leading to declining school enrollments with fewer year-round residents and a smaller base of permanent residents from which local employers and organizations can draw from for workers and volunteers.

Fisher said Deer Isle’s select board wasn’t inclined to interfere with the market, but planned to monitor its impacts and address housing in updates to the town’s comprehensive plan.

In Stonington, select board member John Steed cited the Island Nursing Home’s closure as one reason to form the task force.

“Vacation rentals seem to be changing the dynamics of what’s available,” he said.

Duncan was spurred by the tremendous number of recent sales and rising real estate prices, which could undermine the island’s sense of community and create a “ghost town.”  

“If someone buys a house that gets used for three to four months of the year, it doesn’t do our economy a lot of good,” she said.