According to a 2018 study by Duke University, the majority of Black wealth is tied to homeownership. This means that home equity is particularly important within the African American community. When Burkley Allen, District 18 Metro Councilwoman, proposed a bill that would significantly reduce the value of Black homes in Nashville, the NAACP, Minority Caucus, and Black residents became alarmed.
Attendees of the Tuesday Metro Council meeting were met by a tide of yellow. These were homeowners wearing bright yellow t-shirts reading “PROPERTY RIGHTS”. The homeowners were there to voice their opinion about a controversial bill regarding Short Term rentals.
Short-term rentals (STRs), more commonly known as Airbnbs, have been a subject of controversy for several years in Nashville. Legislation filed by Councilwoman Burkley Allen would have restricted non-owner occupied STRs to commercial areas, preventing them from being in neighborhoods zoned for multifamily residences.
“A large majority of the property that’s zoned Residential Multifamily (RM) are in historic Black neighborhoods,” said Councilman Scott Davis of District 5. “Even though they may not be using those properties as Airbnbs, restricting the use still lessens their property value.”
At a time when property values are high, many Black homeowners are using the opportunity for favorable loans on their property for home improvement and education, as well as profit-making endeavors.
“The color of wealth is tied to homeownership, value, and the ability to build generational wealth,” wrote an anonymous PRIDE reader in a recent Op-Ed. “Our (Black’s) opportunities for generational wealth are attainable through homeownership. We can take advantage of the same development opportunities of properties that we ALREADY OWN and use the short-term rental permits as an avenue to RETAIN/REGAIN power in our neighborhoods. Black families are very close to being denied one of the easiest opportunities to build generational wealth in our own neighborhoods. A movement brought by white neighborhood associations and the hotel industry seeking to remove short-term rental permits in all RM zoning.”
One lady in a yellow t-shirt shared her story: “I live in an older house in the Black neighborhood,” she said. “As soon as Burkley filed the legislation, the bank lowered the value of my home. I had been approved for a $120,000 home equity loan on my house, but because of Allen’s legislation, the amount of my loan was lowered by 40 percent. That’s not enough for me to renovate.”
Another resident said, “We’ve already been hit twice before. They put the highways through our neighborhood to separate us. Then, they put high density, multifamily zoning in our neighborhoods so they could put in the projects. Now that it is worth something they want to change the rules.”
Allen has listened to the concerns, and is trying to address them. She is working with homeowners to make changes to her legislation that will help ease the impact.
“This is a complicated issue,” she said at the council meeting. “Often we feel that it is all out of town investors who are benefiting from this when actually there are people who are our neighbors who this is a step up to economic security or gain.”
Allen has proposed amendments to her bill that most property owners seem to find palatable. Allen’s amendment would allow those properties that already have permits and those properties that are in the process of being permitted to be grandfathered in.
Allen would also like to keep those permits transferable to the next property owners, that way the property won’t lose value and future generations can still benefit.
While Council-woman Allen has agreed to continue to work with the community to mitigate the unintentional damages her legislation may cause, Councilman Freddie O’Connell is a different story.
Freddie O’Connell is the councilman for District 19 and is running for re-election unopposed.
His district contains most of the large, expensive downtown hotels with rooms selling for over $300 per night. The hotels are the businesses that are most affected by the Nashville STRs.
Amid accusations of being in with the “Hotel Lobby” O’Connell has an amendment in place to remove the parts of the bill that would allow the permit to be grandfathered and passed on to future generations –hurting home values and the ability of Black homeowners to pass on the benefits to their heirs.
The NAACP, Minority Caucus, and Black homeowners have vowed to fight O’Connell.
“I understand we have to find more balance with the growth of the Airbnb market and not allow it to overtake other needs in Nashville,” said community activist Jackie Sims. “However, the need to allow more persons of color to share in the prosperity of a pro-growth city such as ours is great. African Americans are just as interested in building generational wealth for their families.”