Airbnb Restricted Zoning

13 Replies

Hey guys had a question! I I am in the process of picking up my first rental listing to relist on airbnb. I am in the Midway area of Chicago. And there is a lot of restricted residential zoning near airport. I had an apartment ready to go with the landlord on board. However it landed in a residential restricted area. So far I have done some research, have contacted a guy in that is knowledgeable in the department of business in Chicago and said i couldnt do home sharing in that area.

 Anyone have suggestions? Can I possibly submit petition with landlord's consent even in a restricted area?

It looks more like you are looking for confirmation rather than information. You are doing everything perfect with your due diligence.

Is there a particular reason it has to be that particular piece of property? I think your time lost with the board and city zoning will be a waste and could be better spent finding the an investment that allows STRs

Good on ya though for taking the time to check. You would be amazed at how many people simply blow off these first few steps.

No, the purpose of the restriction is to stop airbnb in the area. Why would you think they would reverse their decision for you. Not logical.

Don't waste your time, they do not want airbnb and that is that.

@Michael Kugler no not at all, actually I said no I will not be moving forward to the landlord the same day I found out. I did not pause and focus on this exclusively  on this specific property. I was simultaneously looking at others.

I didn't waste too much time. 

Yes I check zoning and such first. To save time, and avoid signing a lease and potentially losing money after giving security deposit and what not.

@Thomas S. No I didn't think they would do is specifically for me. I had actually already spoke to someone of authority who has information on this topic. However I figured I'd ask to see if anyone knew a loophole around it and out of curiosity.

Some of these rules and regulations are new which means there may be some gray area.  yes I agree, I was looking at many other rentals at the same time.

@Alexander Ramos I think these are very common questions as airbnb is a somewhat newer investment strategy. I am learning about all of this as well. I actually teamed up with an airbnb property management company to learn a little more and we are hosting a meet up at the end of the month to share with other like you. 

But yes it seems challenging to make any changes to these regulations and I am sure they will continue to change. 

My advice... AirBnB in a city. You’re asking for trouble. If it’s not already banned it will be. Do it in a tourist area that likes you and respects you! And pay your sales and occupancy tax.

@Weston Harding good idea, teaming up with management company that helps!

Yes i agree! Sent you a pm.

@Lucas Carl

Thanks for the tip, will definitely keep that in mind!

You have to be a sheepdog. 

Sheep are your renters.  They pay money that goes in your pocket.

Wolves want to eliminate or eat the sheep.  Wolves are your laws, rules, regulations, ordinances, neighbors, and competition that do not want you to run your business.

The sheepdog keeps the wolves away from the sheep.  You do whatever is necessary to keep the wolves away or eliminate them.  Only you can draw the line between something necessary and something that will get you in afoul of the wolves and the wolf pack.

@Lucas Carl has a great point. It's much easier to operate in a tourist city. On the flip side, there is 10x the competition. I operate exclusively in a city, and it's profitable for me because there is a lot less competition. If you can operate within the rules that is... some cities obviously are much more of a "wolf" than others to put it in the words of @Paul Sandhu .

There's been some resistance from the aldermen near Midway to restrict AirBnB. There have been a number of cases where AirBnB single family rentals are being used at "party houses" . They are restricting new hosts but will allow existing hosts to be grandfathered in.  I would check with your ward's office before proceeding if you are in a multi-unit. 

Its always advisable to have a good attorney and have them look at the restrictions in addition to doing your due diligence with the city/town. Agree with the view that you do have to look forward to understand where the current wind is blowing in the city/town your looking at. Things can change in an instant if they pass laws restricting short term rentals. 

Thanks guys for chimin in great and helpful responses!

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