The success of Airbnb has been good news for homeowners and anyone with a spare room but not so good for hotel chains and motels. It was inevitable that at some point, state governments would be lobbied to control the growth of short term rentals.
The result is a mishmash of laws and regulations across the country that provide a very uneven playing field for anyone wanting to offer short term rentals.
While the changes were prompted by the growth of Airbnb and are directed mainly at hosts, the result includes many companies and individuals offering short term rentals.
Some laws in major cities you need to be aware of in 2022 include:
New York City
Under Senate Bill S6340A, it is illegal in New York city to rent an entire apartment or home for fewer than 30 days.
This provides a problem for Airbnb hosts but less so for corporate rental properties. As most of our clientele stay for longer than 30 days, this law doesn’t apply.
San Francisco has gone in a different direction. You can rent out property for any length of time with an upper limit of 90 days per year.
If the property owner does not live in San Francisco for at least 275 days per year, they are not permitted to let out property at all.
Honolulu in Hawaii went in a similar direction to NYC. It mandates that you cannot rent out a property for less than 30 days at a time.
Fines of up to $10,000 per day are possible if you’re caught breaking this law. Again, this won’t be relevant to most corporate housing providers, but it is something to be aware of.
Honolulu also divided rentals into two categories, bed and breakfast rentals or transient vacation properties. Each has their own regulation, so check with the city before renting out a property.
Las Vegas has introduced a license requirement for all rentals. There are separate guidelines for leisure rentals than business rentals, so owners should be aware of each and perhaps, stick to one of the other.
While not relevant to corporate rentals, landlords are not permitted to rent out properties for weddings, parties and other special events. Quite a restriction on a city like Las Vegas!
New Orleans has also restricted short term rentals. In fact, rentals are banned completely in the French Quarter and the Garden District.
Owners who live within the building require a commercial short-term rental permit to provide corporate accommodation. A leisure license is also available.
Washington DC introduced rules to restrict rentals to a primary residence. You must register with the city and obtain an endorsement to be able to rent out property.
This isn’t thought to apply to commercial landlords but it’s definitely worth checking.
Other city laws and ordnances against short term rentals
A number of cities have also passed laws restricted the growth of Airbnb. Most of them concentrate on stays less than 30 days, so aren’t relevant to corporate housing.
However, housing law is ever-evolving so we recommend performing due diligence if you plan on buying investment property to offer as corporate rentals.
The good news is that many of these laws are aimed firmly at Airbnb and similar platforms and not corporate housing providers.
However, the crossover in some of these laws means you should definitely seek legal advice if you’re planning to buy an investment property for the short term rentals market.