Kennett Square wants to limit how many houses become Airbnbs. It’s not the first time it’s come up in Chesco.
With only a few houses going on the market, some Chester County municipalities are wondering how to keep them for primarily residents.
When a little cape house went on the market last year in Kennett Square, “it was like a bloodbath,” real estate agent and borough resident Joelle Waterkotte said, recalling the volume of interest.
“We got some flack from somebody thinking that it was rigged,” she said. “That’s how intense the home searches are in the borough.”
Then Waterkotte heard in the fall that one of her listings on Kennett Square’s Center Street sold to a buyer for part-time use as a short-term rental, hosting visitors through sites like Airbnb or VRBO. She realized how many houses in an already limited stock could be snapped up for people who don’t intend to live there.
Finding a home in the borough is “a needle in a haystack,” said Waterkotte, who has a short-term rental in the guesthouse on her property.
The vacation rentals — what kind and how many — are up for discussion in Kennett Square as council considers a revised ordinance that is slated to come back before the officials after discussion earlier this month. And they’re following in the footsteps of other communities in Chester County, including West Chester which passed an ordinance in recent years.
“I absolutely think it’s an issue,“ Waterkotte said. ”I think every single house matters."
A supply and demand problem
In Chester County, which saw some of highest population growth in Pennsylvania between 2020 and 2024, the demand for housing is outpacing supply. Fewer single-family detached homes were built in 2024 than the last several years, according to the county’s planning commission, and less new units were being constructed this decade compared to last.
Meanwhile, cost is going up. In 2024, sales hit a median of $525,000 — the highest in the county’s history. That year, 331 homes sold for under $250,000, a decrease of 5.9% from 462 units in 2023.
The desire for more housing often comes into conflict with what residents want. In several cases, proposals from developers for high-density housing in places across the county have resulted in townships purchasing the land to preserve it as open space instead.
There’s no data or empirical study of short-term rentals in the Greater Philadelphia area to show what kind of scale the market has, said Vincent Reina, professor of urban economics and planning at the University of Pennsylvania. But the units definitely have neighborhood-level impacts, driving up costs for houses in those neighborhoods.
“By virtue of kind of decreasing the supply of the normal rental housing stock you’re essentially creating more demand for the existing units that are there,” he said. “In some markets, particularly where there’s not enough housing supply, those effects can be quite significant.”
Kennett Square, like other communities, is trying to strike a balance between addressing a need — tourism — while having available and attainable housing for young or first-time buyers looking to live there.
“We are a vacation destination with Longwood Gardens so close. We want to have those options for people, plus for residents to make a little bit more money and supplement their income,” said Doug Doerfler, chairman of Kennett Square’s planning commission. “But we really heard that the biggest priority was keeping our neighborhoods and keeping that spirit of neighborhood as part of the community.”
Revisiting the short-term rental issue
The ordinance, developed after residents grew concerned about several homes becoming full-time short-term rentals, would establish that short-term rentals can only be in accessory dwelling units — like above a garage, or a guest house — within residential districts, with a limit of one short-term rental on the property at a time. They’d be allowed as a principal use in the commercial district.
The borough won’t sweat over someone renting out their house if they’re gone for a few weeks, but the commission doesn’t want non-owner occupied homes used exclusively for short-term rentals. They also recommended a cap of 20 throughout Kennett Square. There are roughly 25 registered now, officials said, meaning no more could come in.
The ordinance wouldn’t shut down the existing full-time, short-term rentals in single-family homes, but once those houses sold, they’d be subjected to the proposed restrictions, Doerfler said.
But speaking to council earlier this month as they discussed a new proposed ordinance, Emery Jones, who owns several short-term rental properties, said fear was overshadowing the economic impact. Jones said between the two houses they rent in Kennett Square, there were 42 bookings in December.
“That’s about 120 people who eat at restaurants, coffee shops and shop at all the lovely boutiques we have in town. They’re spending vacation dollars straight into our economy. We know this as they leave us notes on their adventures in the guest books,” she said.
Other residents disagreed, urging the council to pass the measure.
“It helps protect our homes going forward. I think it’s fair to not permit them in single-family homes in the residential areas, because they should be homes for people,” resident Jackie McKenna said. “Restricting them in this manner is a small thing we can do to protect our homes.”
What’s happening elsewhere in Chester County
In Phoenixville, with its singular boutique hotel, the short-term rentals there are filling a need otherwise not addressed.
The borough doesn’t have a specific ordinance for the properties, and out of its 7,500 homes, probably 50 are being used for this purpose, said Jonathan Ewald, president of Phoenixville’s borough. The properties aren’t concentrated in any particular area, and they haven’t received complaints about the visitors, so the council hasn’t felt the need to address.
“Just limiting short-term rentals won’t solve the availability and affordability issue for us,” he said.
In West Chester, where more than 60% of housing in the borough are rentals, housing attainability has been a driving focus for its officials.
“When you’re a younger person and you’re trying to get that down money together and just qualify for something, versus an investor or developer [who] maybe are a cash buyer, it’s hard to compete,” said Jim Cherry, chairman of West Chester’s planning commission.
West Chester officials deliberated an ordinance for more than a year, trying to find an approach for one of the most densely populated communities in the state, hosting a university and serving as the county seat.
Ultimately, the borough council passed an ordinance in 2024 that caps short-term rentals at 20, and contains them to the town center. They sent cease and desist letters to the few that weren’t within that radius.
“There’s only so much we can do because we’re only 1.8 square miles, and we’re already pretty well developed,” said West Chester council president Nicole Scimone. “But there’s little things in each direction that we’re trying to do to create opportunities to create some more homes that people can purchase and live in and enjoy the community.”
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