Why a Long Island Town’s Crackdown on Vacation Rentals May Not Fix Its Housing Crisis

The four-bedroom waterfront home on Long Island's North Fork hadn't even hit the market when Diane Mollica's colleagues began imagining another use for it."Several of them commented that it would be a fabulous rental property because it has all of the perks that you want on vacation," Mollica, a real estate agent with the Gambino Group at Compass, tells Realtor.com®.It was easy enough to see their point: Beyond walls of glass stood a swimming pool, a sandy beach, and the sparkling blue waters of the Long Island Sound. Upstairs, a rooftop deck offered yet another picturesque view.But Southold, the town encompassing much of the North Fork, wants fewer homes operating as short-term rentals. A newly proposed permit lottery would allow just 119 properties across the town's North Fork hamlets to offer stays shorter than 30 days—that's less than one-fifth of the 640 active vacation-rental listings in October.Officials hope the regulation would help protect residential neighborhoods from revolving vacation guests and preserve housing for people who live and work there year-round. But research from cities that have tried similar restrictions shows mixed results.A town fighting for its year-...