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Know Your Property Rights: Illegal Vacation Rentals

by Mimi McKee

Know the laws of short-term rentals in Volusia County

Short-term rentals have become a mainstay of the tourism industry in Volusia County, and with the rise of Airbnb and VRBO.com, there has been a rise of short-term rentals in all parts of the country, in all kinds of neighborhood settings. The websites allow users to book nightly, weekly and monthly stays. Volusia homebuyers and current property owners need to understand the legal rights to use property.

What to know about Airbnb and VRBO

Here are six tips to consider for short-term rental properties:

  • The right to rent is a core property right. With a single family residence, you can live in it, rent it or sell it.
  • Renting is a residential use. With things like Airbnb, where investors own multiple properties, it is starting to edge into the territory of being a business. Even if it may be, it doesn’t defeat the residential status of the property.
  • You have the right to use your property for productive purposes, but it can’t interfere with your neighbor’s use and enjoyment of their property, or injure the community at large. Provided the behavior on your property does not cause a private or a public nuisance, you have the right to rent.
  • Because it is a core property right, it can’t be turned into a privilege.
  • While a vacation rental may be considered a business that could be subject to a business or occupational tax, renting is still a residential use, and remains that core property ownership right.
  • There are registration and licensing schemes that some communities are proposing to inspect and monitor what people are doing with their rental properties.

Illegal Use of Rental Properties

The illegal use of vacation rentals is making national headlines. The most recent news comes out of Miami Beach, Florida where the city has implemented stricter laws requiring online platforms to list specific business license information on their sites. If the property is outside of the zone, the homeowner could see considerable fines from local government. The law was implemented in September 2018 and according to reports, Miami Beach listings on Airbnb dropped from 10,000 to 4,000.

In Volusia, the city of New Smyrna Beach has a “short-term rental map” outlining specific areas within the city that allow nightly and weekly rentals. A zoning and permit technician for the city confirmed, “it is not restricted to a zoning district, just location as indicated on the map. Only those in the purple shaded areas can rent.”

Last year, homeowners in Clearwater, Florida were given a short-term rental violation of $35,000, the city’s second largest fine for short term rentals – $500 per day for website listings over a 30-day period. Renting their home nightly was against city law. In this case, the neighbors and Homeowners Association President reported the owners.

In January 2018, a bill was introduced to Congress that would strip local governments of the right to regulate short term rentals and give such power to the state. Property owners would need to register a license each year through the Department of Business & Professional Regulation. The bill passed Senate Regulated Industries Committee, but never made it out to the floor vote.

What does this mean for rental properties in Volusia County?

Because there is no state income tax, Florida has a Tourist Development Tax on rentals less than six months plus one day. According to Volusia.org, owners are responsible for collecting a total of 12.5 percent tax on each short term rental; 6 percent is remitted to the County of Volusia Tourist Development Tax office. The additional 6.5 percent is remitted to the Florida Department of Revenue.

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