Vacation rentals do soak up housing that could be used by long-term rentals. The operation of commercial venues in residential neighborhoods also runs up the prices: VR's are priced at a multiple of cash flow, not at an affordable percent of an income-earning family's budget, and cash flow brought in by vacationers is .... larger than long term renters can pay.  Yet they do not pay commercial property tax rates. This means residents subsidize these business activities for their 'values' go up, their taxes go up, but they don't get the private revenues harvested by the illegal operators. Not fair, not good for residents, not good for respect for the law. Put a leash on it and charge the full boat tax structure for the remaining permitted commercial activity.