Homeowner in center of OC rental debate speaks out

The woman whose property is at the center of a small-town firestorm over single-family home rentals is speaking out, saying she’s done nothing wrong — and never would have even bought the Mallard Island home in the first place had rental restrictions been in place.

“I’m tired of just being quiet and have all this happen to me,” said Lisa A. Gorman, the Gaitherburg, Maryland, restaurant owner who bought the home at 1501 Teal Drive in October, “because it is almost borderline harassment at this point. I really don’t think I did anything wrong.”

Neighbors complained enough about the home’s weekly rentals that Ocean City zoning officials on Aug. 19 held a public hearing. The goal was to solicit feedback from homeowners and residents on a proposal to potentially place further limits on rentals of single-family homes and mobile homes throughout Ocean City. It drew a standing-room-only crowd and hours of testimony.

Gorman, 48, in an interview Thursday, said she did attend the public hearing. However, when her name was called to speak, she decided not to.

“I don’t want people to know who I am, kind of,” she said. “I’m almost ashamed to go down to my own property. I don’t want my neighbors to know who I am. I’m scared. I don’t know what they’re going to do to me.”

One of the issues that arose from that hearing was a reminder from zoning officials that Ocean City’s code says no more than four unrelated adults can rent a single-family home. Gorman argues the law still applies when it’s four separate families, and that so far, her renters have not violated that restriction.

The house is advertised as sleeping 17, but the most renters they’ve seen are 13 to 14 people, she said. To the best of her knowledge, nobody has violated the rules about families staying there, and booking agent Central Reservation is catering to families, she added. One group had tried to rent there for June, “but de-booked them” because they were not a family, Gorman said.

Gorman said she spent almost a year looking to purchase a home at the beach, as not just an investment property, but as a place to which she’ll retire someday. She told her real estate agent of her desire to purchase a single-family home that could be rented, and she found nothing to stop her: no municipal rules prohibiting rentals. No homeowners association. No restrictions flagged by her mortgage company.

Gorman said it came down to either the Teal Drive property or a home in the Fenwick Island area, “but I decided that I wanted to go to Ocean City, Maryland, because I love Ocean City,” she said. “That has always been my beach town. I chose to purchase a home where the property taxes are almost $9,000 a year versus a home in Delaware where the property taxes are $800 a year. Big difference there, OK?”

So she purchased the home with an investment loan for $577,000 and put forward a down payment of $350,000. Now, she’s renting it weekly for $1,800 to $5,550.

Complaints come

Right away, having large groups of people rent the home ruffled feathers among homeowners in the professional, year-round Mallard Island community.

Within a matter of hours of that first rental group taking the keys, neighbors had called the police to complain about their taking scooters and riding around the loop-shaped neighborhood, according to Gorman. The complaints keep coming.

“These tenants staying at this home, who have paid a decent amount of money to stay, feel they’re being harassed,” Gorman said. “They called my rental company numerous times, some of the neighbors have, cussing them out. Extremely unprofessional. Threatening them. Telling them — do you know who we are? You don’t know who you’re messing with.”

She’s sought out local legal advice, but no Ocean City attorneys would help.

“One attorney told me, ‘sell the house and get out of there,’ ” Gorman said.

Gorman said if an older deed restriction against renting had been kept in place, she would not have bought in Mallard Island.

“If they didn’t let that lapse, I would not be in this predicament, I feel. They’re negligent. If they want that community protected so much, they should have kept up with their deed restrictions,” she said.

Edward Smith is a Realtor and a Teal Drive homeowner since 1973. He said homes on Mallard Island, located on Ocean City’s bayside as an extension of 15th Street, did in fact have deed restrictions in place since 1952, but they expired in 2000.

“Had we paid attention, we could have gotten the owners to renew deed restrictions,” he said.

It would be possible to recreate deed restriction, “but you’d probably have to get all the homeowners and mortgage lenders on board,” Smith said at the public hearing.

As for solutions, Gorman said she is willing to decrease the amount of people who would rent at one time. She would be willing to decrease the amount of cars renters could bring to the home, even though the driveway and carport can house at least six vehicles. She’d even increase the weekly rental rate “to try to keep the riff-raff out.”

“If we were in a crazy market and everybody was buying everything, maybe I would list it,” she added. “If I could sell that house and not even make a dime, I would. ... At this point, we all have to get along. I’m there.”

bshane@dmg.gannett.com

On Twitter @bwshane