A Balanced Approach to Short-Term Rentals

GTAG supports fact-based, balanced regulations that protect Gloucester’s economy and foster a thriving community.

STRs generate tax revenue, create jobs, and support a year-round economy, driving business to restaurants, shops, and attractions.

Regulations should be rooted in real data to ensure thoughtful policies that strengthen Gloucester while addressing community needs. 

Can Gloucester afford to threaten over $1 million in tax revenue?

Short-term rentals generated over $1 million in tax revenue for Gloucester annually—yet the city still faced a $2.1 million school budget shortfall for FY 2025. Reducing STR activity could further strain the budget, leading to potential cuts in public services.

(See footnote 1)

Embrace visitors.

Elevate Gloucester.

How do short-term rentals contribute to Gloucester’s community?

Small businesses

  • Visitors staying in short-term rentals often spend money at local restaurants, cafes, shops, and attractions. This spending directly supports small businesses, helping them thrive in Gloucester's economy.

  • STRs provide flexible options for travelers, from families needing larger spaces to remote workers looking for longer-term accommodations, expanding Gloucester’s appeal to a wider range of visitors.

Jobs and employment

  • Short-term rentals generate jobs for cleaners, property managers, landscapers, maintenance workers, and other essential services. Many hosts hire locally, keeping employment opportunities within the community.

  • From electricians to laundry services, the short-term rental industry creates sustained job opportunities for a wide range of workers, contributing to Gloucester’s year-round economy.

Tax revenue

  • Airbnbs and VRBOs contribute up to 15% of their revenue to taxes, benefiting both Gloucester and Massachusetts. This tax revenue supports public services, infrastructure improvements, and community projects.

  • The 3% Community Impact Fee collected from short-term rentals goes directly to Gloucester's Affordable Housing Trust, helping to fund housing initiatives and support the development of affordable housing in the city.

Gloucester’s sweeping new short-term rental ordinance.

Gloucester’s City Council introduced new short-term rental regulations set to take effect April 1, 2025. While the new rules limit non-primary residences to 120 rental days per year and place caps on primary residences, the long-term impact on Gloucester’s vibrant tourism and local businesses remains unclear.

Some have expressed that these changes were implemented without fully considering the positive contributions short-term rentals bring to the local economy.

What can we do today?

(1) Source: AirDNA and City of Gloucester regulations. This calculation is based on total short-term rental revenue for the 12 months ending in October 2024, including nightly rates and cleaning fees, as reported by AirDNA. Tax revenue includes Gloucester’s 6% excise tax and a 3% Community Impact Fee, the latter of which applies only to operators with two or more properties. The excise tax is estimated to have generated $1,056,567 in 2024, while the 3% Community Impact Fee, is reported to have generated $127,635 in FY 2024.

These estimates exclude substantial additional revenue generated from direct bookings and local property management websites.