The New Orleans City Council will now consider banning all Residential Short-Term Rentals following a Federal ruling last week that the City's new strict limitations on non-commercial STRs, which included a residential lottery system, could not be implemented.

At the Thursday, September 7, 2023 meeting, Councilmembers Helena Moreno and JP Morrell presented an ordinance for first reading. The new ordinance would ban property owners across the city from operating Non-Commercial Short-Term Rentals (“NCSTRs”). The co-authoring councilmembers, both of whom occupy at-large seats on the council, announced the move in a press release issued the preceding afternoon.

The proposed ordinance is in response to the temporary restraining order issued by the United States District Court for the Eastern District on August 31, which temporarily prohibited enforcement of the City’s NCSTR regime, pending resolution of cross-motions for summary judgment in that case. If the Court finds the NCSTR regime to be unconstitutional, the councilmembers plan to move ahead with a vote on the proposed ban. Oral argument on the constitutionality of the NCSTR ordinances will be held September 14. The Court could take a few weeks to issue its opinion or could rule from the bench that day. 

Critics of the council’s approach to STRs complain that the ever-changing laws governing the industry contribute to a lack of predictability in real estate and the market as a whole. Councilmember Morrell responded to those criticisms by suggesting that the problem is that the industry “refuses to be regulated.” Other councilmembers weighed in via reporting from The Times-Picayune | NOLA.com. 

Only two things are certain in this unfolding drama regarding the regulation of short-term rentals in New Orleans: the federal Eastern District’s ultimate, final ruling will be highly anticipated, and no matter what, some group of constituents will be left unhappy or unsatisfied with whatever the outcome.