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Short term rentals help accommodate SXSW visitors

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They visit, eat, watch films and listen to music. But, where do the hundreds of thousands of people that come to Austin for the South by Southwest Festival stay at night?

The convention and visitor's bureau says there are only about 30,000 hotel rooms in the greater Austin area, which includes Round Rock and San Marcos. Downtown, where all the action is, there's only 6,500 rooms.

"During SXSW, in the Austin area, we have about 1,000 properties, we've seen a very large percentage of them get booked up," said Jon Gray, with HomeAway, a vacation and short term rental company.

"During normal periods in Austin, the average vacation rental, which is about a two bedroom to three bedroom house, rents out for about $250 a night. During SXSW we see those numbers spike to $650 to $850 a night," said Jon.

The city's code compliance office is also seeing an applications to operate a short term rental property.

Reps say they've had to hire additional temporary staff to process applications. Even with the extra help, processing and approval has gone from a 3-5 day wait to a 10-14 day.

Jon said, "A lot of businesses will come in and rent a place, either for their staff to stay or to host an event...some of the companies we've worked with over the course of this SXSW are Nike and Twitter."

With the influx, city reps admit, operating licenses are difficult to police. They monitor illegal rentals through complaints and by comparing ads online.

Jon said, "These people all have permission to rent out their vacation homes. Their vacation home is their primary residence and that's how they do that for these events."

The operating license program went into effect about a year ago. To date, 795 licenses have been issued and 10 applications are pending.

"It makes a great opportunity for our property owners to rent out their property and a good opportunity for travelers to stay as a group," said Jon.

If a homeowner does not have an operating license, expect to receive a non-compliance letter and potentially a citation.

For the last two years, the hotel shortage has been causing problems for people trying to attend the University Interscholastic League's boys basketball tournament.

The dates overlap with SXSW and reps with the UIL say because attendance is so low, they're considering moving the dates or just moving the tournament to another city altogether.

No official decisions have been made.

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