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(Updated May 2012)
According to The 2011 NAR Investment and Vacation Home Buyers Survey, 84% of respondents purchased a property for personal use, but over one-quarter purchased with the intent of renting to others. Renting out a vacation home can offset the costs of this investment until retirement. But what happens when a community acts to restrict short-term rentals? Read on... and you'll find out! (S. Hogan, Information and Web Content Specialist)
The Short-Term Rental Debate
Why restrict?
- Increased noise & traffic.
- Reduced housing stock available to those who live & work in a community.
- Unfair competition with licensed establishments.
Impact of restrictions:
- Diminishes value of investment property.
- Reduces the pool of buyers able to purchase in high-demand vacation areas.
- Infringes upon property rights.
Benefits of short-term rentals:
- Promotes tourism.
- Generates revenue for community.
- Defrays costs of a vacation/second home.
Short-Term Rental Conundrum
Personal, Financial Investment Returns Make Short-Term Rentals Ever More Popular, (DeadlineNews.com, Jan. 27, 2012).
Short-Term Rentals Ever More Popular, but Not Without Risks, (DeadlineNews.com, Dec. 23, 2011).
Risks and Rewards of Short-Term Rentals: A Starter Guide for Property Owners, (Property Management Software Guide, Dec. 20, 2011).
Market for Vacation Homes is on the Rise, (Wall Street Journal, Jan. 10, 2011).
Are Vacation Rental Regulations on the Rise?, (Community from HomeAway, Sept. 10, 2010).
More Destinations Shut the Door on Vacation Rentals, (USA Today, Aug. 6, 2010).
Home Sweet Home? The Efficacy of Rental Restrictions to Promote Neighborhood Stability, (Scholarly Works, 2009).
Win, Lose, Compromise
Short Term Rentals Causing Long Form Headaches for Council, (KUT News, Jan. 10, 2012).
New York City Council Seeking to Increase Fines on Vacation Rentals, (Project Vacation Rentals, Dec. 13, 2011).
New York City Council Seeking To Increase Fines on Vacation Rentals, (Project Vacation Rentals, Dec. 13, 2011).
Hey, Wanna Rent My Couch?, (New York Magazine, Nov. 27, 2011).
City of Austin Begins Work on Short-Term Rental Regulations, (Community Impact Newspaper, Apr. 22, 2011).
Ordinance Threatens Chicago Vacation Rentals, (Medill Reports Chicago, Apr. 21, 2010).
Articles, Surveys & More from NAR
2011 NAR Investment and Vacation Home Buyers Survey, (National Association of REALTORS®, Mar. 2011).
Economic Impact of Transient Vacation Rentals (TVRs) on Maui County, (Prepared for the REALTORS® Association of Maui, Jan. 8, 2008).
Websites & Other Resources
Learn about the Short-Term Rental Industry
Project Vacation Rentals -A collection of articles posted by "professionals against the legislation banning short-term rentals in New York City" (Source: Project Vacation Rentals). See this site for articles, legislation, and more with a New York focus.
Community from HomeAway -HomeAway (www.homeaway.com) connects travelers with short-term rental properties, and Community from HomeAway is a member-driven site with topic forums, resources, groups, and blogs for both travelers and property managers.
Locate Short-Term Rental Listings
Rentmix.com aggregates vacation and short-term rental listings from several sources (AirBnB, HomeAway, and FlipKey) and shows listings on a full-screen map. For a bit more information on Rentmix.com, see this AGBeat article.
Check out more short-term rental websites: AirBnB FlipKey HomeAway
Compliance
Tax Topic 415 - Renting Residential and Vacation Property, IRS.gov
Publication 527 (2011), Residential Rental Property, IRS.gov
Vacation Rental Tax Compliance Frequently Asked Questions, HomeAway Connect
* Please check with local government in your rental property area for information on permits, taxation, and regulations.
eBooks & Other Resources
eBooks.realtor.org
The following ebooks and digital audiobooks are available to NAR members:
Buying a Second Home: Income, Getaway or Retirement (Adobe eReader)
Complete Guide to Investing in Rental Properties (Adobe eReader)
How a Second Home Can be Your Best Investment (Adobe eReader)
How to Succeed and Make Money with Your First Rental House (Kindle, Adobe eReader)
Leases & Rental Agreements (Adobe eReader)
Second Homes for Dummies® (Kindle, Adobe eReader)
The Unofficial Guide to Managing Rental Property (Adobe eReader)
Books, Videos, Research Reports & More
The resources below are available for loan through Information Central. Up to three books, tapes, CDs and/or DVDs can be borrowed for 30 days from the Library for a nominal fee of $10. Call Information Central at 800.874.6500 for assistance.
Buy it, rent it, profit!: Make money as a landlord in any real estate market, (New York, NY: Simon & Schuster, 2009). HD 1394 C39
Vacation home fractional conversion: A complete guide for home sellers, builders and real estate professionals, (Chicago, IL: Fractional Retreats LLC, 2009).
Vacation nation: The complete guide to timeshare, private residence clubs, fractionals & destination clubs, (Chicago, IL: BookSurge Publishing, 2009).
Investing in a vacation home for pleasure and profit, (Mason, OH: Thomson-South-Western, 2006).
Complete guide to second homes for vacation, retirement, and investment, (New York, NY: John Wiley & Sons, 2000). HD 1341 EL2c
Field Guides & More
These Field Guides and other resources in the Virtual Library may also be of interest:
Field Guide to The Condominium Market
Field Guide to Vacation, Resort and Second Homes
Field Guide to Zoning Laws & Ordinances
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The inclusion of links on this field guide does not imply endorsement by the National Association of REALTORS®. NAR makes no representations about whether the content of any external sites which may be linked in this field guide complies with state or federal laws or regulations or with applicable NAR policies. These links are provided for your convenience only and you rely on them at your own risk.