What Happened
On September 16, 2026, Nantucket's Select Board voted unanimously to reject a request by Nantucket Property Owners—a real estate investment company that purchased 36 lots in the Richmond Great Point development's "Sandpiper" subdivision in 2022—to lift a prohibition on short-term rentals (STRs). The company argued that the STR ban, imposed over a decade ago as a condition of the development's memorandum of agreement, was "inequitable" and inconsistent with Nantucket's November 2025 Town Meeting vote that legalized STRs across most of the island's zoning districts.
Nantucket Property Owners contended that the restriction unfairly burdened their residents while homeowners elsewhere on the island could operate STRs freely. The company's attorney, Johanna Schneider, framed the dispute as a matter of "equal protection" under Massachusetts zoning law, claiming the differential treatment was "chilling the sale of remaining ownership units."
However, the Select Board—led by Vice Chair Brooke Mohr and member Bob DeCosta—held firm. They emphasized that the STR ban was an explicit condition exchanged for density bonuses and other development concessions granted over a decade ago, and that Nantucket Property Owners purchased their lots with full knowledge of the restriction.
The Financial Impact
While no direct fines were levied in this case, the financial stakes are significant:
| Impact Category | Details |
|---|---|
| Property Valuation Risk | 36 lots in the Sandpiper subdivision face reduced market appeal and resale difficulty due to enforced STR ban |
| Lost Rental Income | Individual homeowners cannot generate short-term rental revenue, a material income stream for affordable housing residents |
| Legal Costs | Nantucket Property Owners funded attorney representation (Johanna Schneider) and lobbying efforts with no favorable outcome |
| Developer Concessions Given Away | Density bonuses and other zoning variances granted at project inception no longer leveraged as intended |
For individual residents, the inability to operate STRs eliminates what many affordably-housed families view as essential supplemental income. Select Board member Bob DeCosta noted that while STRs were not yet codified in zoning when the memorandum was signed, they were "a right on Nantucket" that residents elsewhere exercised freely.
How LawfulStay Could Have Helped
Before the 2022 purchase: Nantucket Property Owners' due diligence team should have consulted a comprehensive STR regulatory database like LawfulStay. A search of "Nantucket, MA" would have immediately surfaced the Richmond Great Point memorandum of agreement and its STR prohibition clause—a material condition binding all unit owners and future purchasers. This discovery would have either dissuaded the $36-lot acquisition or prompted negotiation of the restriction before closing.
Before the September 2026 request: A LawfulStay search would have shown not only the Richmond restriction but also comparable bans in other major Nantucket developments (Sachems Path, Abram's Quarry) and across deed-restricted affordable housing units island-wide. This pattern context would have signaled that challenging the restriction was unlikely to succeed and that the town's policy—reaffirmed in the November 2025 Town Meeting vote—prioritized year-round occupancy and community stability over investor flexibility.
For town staff: LawfulStay could have served as a quick reference tool when evaluating the request, providing instant confirmation that the memorandum condition superseded the broader November 2025 legalization vote, and that several precedents existed for STR restrictions in residential developments.
A single search on LawfulStay's 1080+ jurisdictions database would have prevented months of wasted legal effort and made the company's business case clearer before capital was deployed.
Key Takeaways for Hosts
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Memoranda of Agreement Survive Zoning Changes. Even when a city or town legalizes STRs broadly, private restrictive covenants, homeowners association rules, and development agreements remain enforceable. Nantucket's November 2025 legalization vote did not override the Richmond Great Point memorandum signed a decade earlier. Always check deed restrictions and HOA bylaws, not just zoning code.
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Affordable Housing Developments Carry Stricter Rules. Subsidized and deed-restricted housing units on Nantucket uniformly ban STRs. This is a national trend: affordable housing programs tie their concessions to long-term occupancy commitments. If you own an affordable unit, research whether an STR ban is a condition of your deed before purchasing.
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Early-Stage Due Diligence Is Non-Negotiable. Nantucket Property Owners learned this the hard way after investing in 36 lots. Before acquiring or developing property, retain a real estate attorney to review all governing documents—memoranda, CCRs, HOA bylaws, and local zoning—and consult a STR compliance database to map restrictions in your target jurisdiction.
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Regulators Prioritize Community Character Over Developer Flexibility. Nantucket's Select Board explicitly cited year-round residential character and traffic/parking concerns as reasons to maintain the STR ban, even in an island-wide legalization environment. Know your local government's priorities; they will override investor arguments.
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Purchased-Property Restrictions Are Binding. Select Board member Bob DeCosta stated plainly: buyers "were aware of the restriction when they bought into the development." Courts and regulators will enforce this principle. Caveat emptor applies to STR restrictions as much as to property condition.
The Bigger Picture
Nantucket's rejection of the STR exemption reflects a broader national tension: as cities legalize STRs to increase housing supply and tourism revenue, they simultaneously carve out exceptions for deed-restricted affordable housing, planned communities, and historic districts. The goal is to preserve long-term housing stock and neighborhood stability.
What makes Nantucket's case instructive is that even a decisive Town Meeting vote legalizing STRs (November 2025) did not overturn private restrictive covenants. This mirrors enforcement patterns in cities like New York, Los Angeles, and San Francisco, where STR legalization co-exists with hundreds of micro-jurisdictions—HOA rules, historic preservation overlays, affordable housing programs—that impose local bans. The legal hierarchy is clear: specific restrictions (memoranda, deed clauses, HOA bylaws) trump general zoning permissions.
For affordable housing advocates, the Nantucket ruling is a win: it keeps homes in the long-term rental and owner-occupancy pool, preventing conversion to vacation rentals that drain year-round residents. For individual homeowners in restricted developments who hoped legalization would free them to generate supplemental income, it is a loss. The practical effect is that affordability is purchased at the cost of housing flexibility.
Stay Compliant
If you own or plan to purchase property in Nantucket, Richmond, or any jurisdiction where STRs are restricted by covenant or agreement, consult LawfulStay.com before making a move. Our database of 1080+ jurisdictions and their STR rules—including deed restrictions, HOA policies, and historic overlay requirements—will show you exactly what is permitted and what is prohibited in your target neighborhood.
Nantucket Property Owners' costly legal campaign could have been avoided with 10 minutes of research. Don't repeat their mistake. Search your city on LawfulStay today.