Tennessee STR Grandfather Clause Law

[Ryan Moyer]

I'm looking at a property in semi-rural TN located in a county that does not currently have any STR restrictions. I'm well aware of the adage that it's best to buy where STRs are already regulated so you know what you're dealing with and things are less likely to change on you.

However, there appears to be a Tennessee state law (verbiage below) that says if you're already operating as an STR and a law is made that then restricts them, the new law does not affect you as you are grandfathered in.

I was thinking this law would protect me from future legislation. However, I was speaking to someone in Nashville recently and they said that many existing STRs were wiped out by Davidson county STR regulation. Am I misreading the grandfather clause law? Why did it not protect those owners?

Grandfather Clause
T.C.A. § 13-7-603(a) provides that any ordinance, resolution, regulation, rule, or other requirement of any type that prohibits, effectively prohibits, or otherwise regulates the use of property as a short-term rental unit does not apply to property that was being used as a short-term rental unit prior to the enactment of the ordinance, resolution, regulation, rule or other requirement by the local governing body. This section also provides that the law in place at the time that the property was being used as a short-term rental unit is the law that governs the use of the short-term rental unit until the property is sold, transferred, ceases being used as a short-term rental unit for a period of 30 continuous months, or has been in violation of generally applicable local laws 3 or more separate times as provided by T.C.A. § 13-7-604.

https://www.mtas.tennessee.edu...

[Collin Hays]

Tennessee is one of the most pro-business states in the U.S. I would feel comfortable operating a STR in an area with no current restrictions that I would not one day be "outlawed". But it's the chance you take pretty much anywhere you buy a STR. There is always a "what if" out there.