In this day and age, the Internet provides ordinary individuals with business opportunities that were unheard of thirty years ago. For example, recently, we came across a website that allows property owners to list and rent their own single-family home for a short duration of time. Listing the property online is the easy part, but the ramifications of failing to comply with state and a local law are an enormous problem for the uninformed homeowner.
Many property owners assume they do not have to comply with state and local laws to list their homes through these online services. However, this is absolutely incorrect. Take for example, the City of Coral Gables: There is not specific ordinance that dictates short-term rentals are not allowed. However, our research revealed that through the compilation of a number of different local regulations, it appears that short-term rentals are prohibited in the City of Coral Gables.
Pursuant to Article 4 of the Coral Gables zoning code, the use of “Overnight Accommodations” for single-family homes is prohibited in Coral Gables. “Overnight accommodation” is defined under Article 8 of the Coral Gables zoning code to mean “a building or portion thereof designed and used primarily to provide sleeping accommodations for transient guests for a daily or weekly rental charge.”
Therefore, taking Article 4 of the Coral Gables zoning code and defining the terms in conjunction with Article 8, the answer appears to be that local laws prohibit such activities for single-family homes. Nonetheless, this result will vary between one municipality and another. Furthermore, the zoning of the property is also a significant fact to consider.
Thus, we strongly recommend property owners to contact their state and municipalities before renting their own single-family home for a short period of time. This will avoid the possibility of violating any state or local ordinance.
Websites offering these short-term “vacation” rental services are not likely to be found liable to a property owner for any penalties incurred resulting from the property owner’s unawareness and failure to comply with state and local regulations. As a prerequisite to listing short-term rental homes, most of these websites require property owners to accept terms and conditions that place the burden on the property owner to comply with all state and local laws.
There are also tax implications for engaging in such activities. That is, property owners of “transient” rental property are responsible to collect state and local taxes. The amount and type of taxes may vary depending on your state and county.
If you need additional information, or would like to consult with an experienced attorney, contact us today.