What’s the easiest way to learn about STR regulations?

8 Replies

Anyone know a good way to find out what, if any, STR laws and regulations exist in a given locale?

Useguestbook.com only lists major (or random) cities. Are there other, more detailed or exhaustive resources for this?

Other Google searches have been useless.

AirBnB’s advice is to check with the local government, which makes sense, but how?

@Jeremey J.   It's an extremely fragmented regulation system unfortunately.  What I usually do is the following: 

1. What city is the property at?  

2. What county does that city reside in? 

3. Google "TOT tax for ABC County" and see what pops up

4. Call the tax authority for the city and county and ask for the transient occupancy tax collections dept if one exists. 

5. If still in question, then I would probably Google a local STR property management company and see what they say.

I'm sure there are more steps you can do which others might offer but that's my usual M.O.  : )

Best of luck! 

Most municipalities have their ordinances posted online, so that would be the first place to start. Also, placing a call (good luck) to the codes enforcement office of the jurisdiction in which you are contemplating an investment. There are multiple levels - State, County, City...so unfortunately there is no easy answer.

And the bigger unknown is what regulations may come to pass in the days/weeks/months after you close on your purchase.

This is such a fast-moving space that your best defense is to make sure that you aren't underwriting your investment on STR revenue alone. Make sure it also works as a LTR, fix and flip, etc.

If you find a market that is clearly pro-STR, then its likely the numbers will be thin because the market has already factored that in to the price of the properties. You're likely buying at the top of the market, and the downside could be ugly.

STR is a great biz model, but not the most stable. Make sure you have multiple exit strategies, in case STR goes sideways.

@Jon Crosby Thanks, Jon! 

Step #3 turned up a result from the state's website that was somewhat helpful. 

I was missing the right terminology for my web searches -- I think "TOT tax" was what did it.

Looks like it'll still require a call to the county/city offices for specifics, but at least I have some direction.

Thanks again!

@John Oden  

This is sage advice you have provided:  

"...your best defense is to make sure that you aren't underwriting your investment on STR
revenue alone. Make sure it also works as a LTR, fix and flip, etc."

Thank you for the insight.

Originally posted by @John Underwood :

Check local Code enforcement and zoning office. They should know all the rules.

 I was afraid someone might suggest this... :-p

The properties I'm looking at are in a different municipality than where I live, but the one time I have had to deal with the zoning office here, it was borderline ridiculous. 

Several (unofficial) sources told me I wouldn't need a permit for a remodel we were doing on our very rural primary residence. A retired county gov't employee overhead one of these conversations and said I had better check with the zoning office anyway. Not wanting any trouble, I heeded the advice. When I inquired about the permit, the ladies in the office looked at me like I was crazy. They said that people out our way don't come in for those, basically because the county doesn't have anyone to enforce it. BUT, since I was there inquiring I would be required to have one...

I'm not sure if you call that funny or sad or what. I completely get better safe than sorry, but it sure felt like a waste of $150. 

Thanks for the advice, though, on which office might have the information I'm looking for. 

I just hope they don't decide to start enforcing some new regulation just because I showed up and asked. I hate being the guy who ruins it for everyone else.

@Jeremey J. Ask a local host!

Find an investor or local host in the area you're looking in and shoot them a message, definitely be the easiest way to get a good understanding.

@Shelby Pracht  

Thank you. Never thought to ask another local host. There aren’t many (despite low supply/high demand in the area), but worth a shot.

My only hope is that their answer does not echo my previous experience double checking with the local offices.

But definitely worth an inquiry.