Katherine Waddell

I'm a New Hampshire resident writing to oppose HB1068, HB1580, and HB1707. My family purchased a second home as an investment because it is one of the few accessible ways for ordinary people to run a small business without needing massive capital, commercial real estate, or employees. Unlike opening a franchise or a brick and mortar business—which can require hundreds of thousands of dollars and staff—renting a second home is one of the only viable paths for middle class families build the type of long term financial stability afforded to small business owners. These bills would effectively close off that opportunity and make real estate investment a privilege reserved only for large corporations or the very wealthy. My concerns extend far beyond the fact that these bills would raise taxes. Collectively, they represent a significant departure from New Hampshire’s long standing commitment to predictable, broad based, and economically responsible taxation. They also risk serious unintended consequences for local communities, property owners, and the state’s tourism driven economy. HB1580 and HB1707 propose dramatically increasing property taxes on non primary residences and adding a surtax on homes assessed over $500,000. This would have several harmful effects: • It harms middle class families and small family businesses. Many second home owners are not wealthy investors; they are teachers, nurses, tradespeople, retirees, and families who rent occasionally just to cover taxes and maintenance. Real estate has long been one of the few accessible wealth building tools for lower and middle income households. These bills would shut that door while large corporations and institutional investors can afford to absorb the costs and expand their market share. • It unintentionally increases short term rental activity. By dramatically raising taxes on second homes, these bills would push many owners to rent their properties more aggressively simply to cover the added costs. Instead of reducing STR activity, the legislation would create financial pressure that drives more frequent rentals, more guest nights, and more turnover—directly contradicting the stated goals of reducing STR activity in certain communities. Speaking personally, we’ve always required minimum stays and taken great care in choosing who we rent to. But if we’re suddenly expected to absorb an extra $10,000 a year, we might feel pressure to take the riskier reservations we’ve tried to avoid. That’s not good for us, our neighbors, or the community. • It sets a precedent for targeted taxation. Once the state begins carving out specific groups for punitive tax treatment, it undermines the predictability and fairness that make New Hampshire’s tax structure attractive to residents and investors. • It destabilizes local housing markets. Sudden targeted tax hikes can depress property values, discourage investment, and create volatility in towns that rely on stable real estate activity. If second home owners decide to move their investment to Maine or Vermont, the resulting surge in listings would depress home values and shrink the local tax base. When property values fall, the tax burden shifts onto year round residents who cannot afford—or do not want—to move. The very people these bills aim to protect would end up paying more, not less. • It harms local businesses and seasonal economies. Second home owners support restaurants, shops, contractors, landscapers, tradespeople, cleaners, and other tourism dependent businesses. Effectively tripling our tax burden risks pushing us out of the state, reducing spending in communities that depend on it. • It penalizes responsible property owners who already subsidize municipal services. Second home owners pay full property taxes while using fewer services such as schools, social programs, and year round infrastructure. These bills would shift even more of the tax load onto a group that already contributes more than it consumes. • It raises fairness concerns. If the intent is to “punish” out of state owners, lawmakers should be prepared to explain why they are singling out taxpayers who have no vote in New Hampshire. Even if not technically “taxation without representation,” it certainly feels like it. And if hotels are not subject to the same increases, it becomes clear that these bills are punitive rather than principled. Supporters often frame these bills as necessary to address a lack of affordable housing. But in towns in the White Mountains, lakes region, seacoast, and other tourism dependent destinations, driving out short term rentals would also drive out a significant portion of the year round residents who rely on tourism for their livelihoods. STRs are part of the economic ecosystem that keeps restaurants, shops, contractors, guides, and seasonal employers in business. If STRs disappear, so do the jobs that allow many families to live in these communities in the first place. If the true goal is to increase affordable housing, a far more direct and effective approach would be to create incentives for workforce housing development, streamline permitting, or support public private partnerships. Punitive taxes on second homes do nothing to create new housing stock, they simply destabilize the existing economy and risk harming the very residents these bills claim to help. HB1068 adds an additional layer of concern by making unnecessary and confusing changes to the definition of “hotels” to include STRs, which are already subject to meals and rooms taxes. Taken together, these bills don’t simply raise taxes, they introduce instability, discourage investment, and risk long term harm to the very communities they aim to support. I respectfully urge you to oppose HB1068, HB1580, and HB1707 and instead pursue balanced solutions that strengthen local economies without singling out specific groups of taxpayers. Thank you for your consideration.