It's no surprise that short-term rental (STR) properties like those available on Airbnb, VRBO, and HomeAway are everywhere. They offer travelers an alternative to a standard cookie-cutter hotel room, and they can be a great way for property owners to earn some cash by renting out a room or property that would otherwise sit unoccupied. But, as with many new services and products that emerge in society, new concerns and legal issues often arise. So, what should you know as the guest or owner of an STR?
A short-term rental is defined as a furnished real property that is rented for less than 30 days.
A written agreement is not required for a short-term rental or a traditional lease, but it is far more common for a traditional lease to be in writing.
Guests of a short-term rental have fewer rights than tenants; guests can be removed as trespassers whereas tenants likely must be evicted.
In legal terms, there is no privity between a landlord and a tenant's STR guests.
A tenant renting parts of the property to short-term renters may result in increased wear and tear that the landlord did not anticipate when leasing the property to the tenant.
Existing insurance may not cover damages caused by or to short-term renters or their property; this can be especially problematic if the landlord doesn't even know the short-term renters are there!
State regulations, city ordinances, zoning laws, mortgage provisions, homeowners' association rules, condo owners' association rules, covenants, and insurance policies may prohibit or restrict the use of property as a short-term rental.
Hotel and motel occupancy taxes may apply to STRs.
Operating an STR may require a business license and payment of occupation tax.
Many states consider short-term rentals to be commercial use when applying zoning laws and restrictions. Such states include Idaho, Indiana, Kentucky, Michigan, and Texas (Austin). Other states focus on the particular facts of the use of the property. Such states include Alabama, Colorado, Florida, Kentucky, Maryland, New Mexico, Oregon, Texas (San Antonio), Washington, and Wisconsin.
Georgia courts have not been as definitive in their decisions. In at least one case, the Georgia Supreme Court held that the use of oceanfront property on St. Simons Island as a short-term rental and wedding venue violated the applicable single-family residential zoning ordinance. It isn't clear if a less extreme use would have resulted in the same conclusion.
What is an operator of an STR to do? It may be a good idea to consult with and hire a Griffin business attorney to help ensure you follow applicable laws and rules and have sufficient insurance coverage. Attorney Kevin Parker is a local small business lawyer that can help.
Give us a call today!
https://www.thekpfirm.com
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