seems like City Council will enforce new changes Jan 1, 2020 on short-term rentals.
Would be nice to hear if someone has more info/proof.
A resource worth reading is V96/6 of the NC Law Review, a Comment entitled Searching for the Right Approach: Regulating Short-Term Rentals in North Carolina. This document covers what I call the "Big 4" (Raleigh, Charlotte, Wilmington, Asheville) markets in NC. I highly recommend anyone thinking about or currently engaging in STR or VR markets in NC read and understand this document. See also Suggestions for NC Airbnb that discusses other local cities.
Regarding Raleigh Homestays ordinance, I contend that the city, with their ordinance, violates NCGS 160A-424(c) in all respects: "In no event may a city do any of the following: (i) adopt or enforce any ordinance that would require any owner or manager of rental property to obtain any permit or permission from the city to lease or rent residential real property or to register rental property with the city... ; (ii) require that an owner or manager of residential rental property enroll or participate in any governmental program as a condition of obtaining a certificate of occupancy; (iii) levy a special fee or tax on residential rental property that is not also levied against other commercial and residential properties... " Attorneys out there, please chime in. Raleigh Homestays looks and feels a lot like a Raleigh Rental Registration that was legislated out of existence just a few years ago.
My non-legal, layman opinion only.
This post is for entertainment and should not be construed as legal advice.
The city passed an ordinance that will go into effect January 2020. You can operate a BNB yourself and see if you get fined or wait to hear about it in the news. If the financials work, you could switch from a short term rental to a long term rental and having only paid a fine.
seems like City Council will enforce new changes Jan 1, 2020 on short-term rentals.
Would be nice to hear if someone has more info/proof.
A resource worth reading is V96/6 of the NC Law Review, a Comment entitled Searching for the Right Approach: Regulating Short-Term Rentals in North Carolina. This document covers what I call the "Big 4" (Raleigh, Charlotte, Wilmington, Asheville) markets in NC. I highly recommend anyone thinking about or currently engaging in STR or VR markets in NC read and understand this document. See also Suggestions for NC Airbnb that discusses other local cities.
Regarding Raleigh Homestays ordinance, I contend that the city, with their ordinance, violates NCGS 160A-424(c) in all respects: "In no event may a city do any of the following: (i) adopt or enforce any ordinance that would require any owner or manager of rental property to obtain any permit or permission from the city to lease or rent residential real property or to register rental property with the city... ; (ii) require that an owner or manager of residential rental property enroll or participate in any governmental program as a condition of obtaining a certificate of occupancy; (iii) levy a special fee or tax on residential rental property that is not also levied against other commercial and residential properties... " Attorneys out there, please chime in. Raleigh Homestays looks and feels a lot like a Raleigh Rental Registration that was legislated out of existence just a few years ago.
My non-legal, layman opinion only.
This post is for entertainment and should not be construed as legal advice.
Does this eliminate multi family homes from being Airbnb'd? I'm looking to go this route with a quadplex in Raleigh (4 separate studios units) while owner occupying one of the studios. I would rent out 2 of the units as Airbnb, and find a long term tenant for the 3rd unit, while living in the 4th myself. Technically, the studios are only 1 room, plus a bathroom. They do have separate "kitchen" areas but don't include a stove/range, so I'm not sure if this qualifies as a kitchen in this case. Would this be illegal under this new bill?
@Account Closed, I would speak directly with the zoning commission in Raleigh to find out your answer. I am pretty sure it will be no as that would take a long term rental unit off the market. I have a duplex that I have been trying to figure out what to do with here in Asheville. It's fine as a ltr but of course I would have more cash flow as an str. It also has a basement that I could finish and use as a 3rd unit but they won't let me make it a separate 3rd unit and it really doesn't add much to the rent as a ltr if I finish it in. So it sits, unfinished. I don't think I would get my investment back for a very long time if I decided to finish it in.
thanks @Jon A. yes I've found the zoning requirements which use the term "room" and "cooking facilities" that aren't quite defined. I'm wondering if a studio unit - one room plus a bathroom - would count as one room in a property. I'm also wondering if a makeshift kitchen with only a sink/fridge count as "cooking facilities" since there is no stove/range.
thanks @Jon A. yes I've found the zoning requirements which use the term "room" and "cooking facilities" that aren't quite defined. I'm wondering if a studio unit - one room plus a bathroom - would count as one room in a property. I'm also wondering if a makeshift kitchen with only a sink/fridge count as "cooking facilities" since there is no stove/range.
Answers are in the ordinance text (I provided a link in my prior post)
ORDINANCE NO. 2019 – 945 TC 416 TC-1-19
AN ORDINANCE TO ESTABLISH REGULATIONS CONCERNING HOMESTAYS—A TYPE OF OVERNIGHT LODGING—AND TO ALLOW HOMESTAYS IN CERTAIN ZONING DISTRICTS THAT PERMIT RESIDENTIAL USES.
...
f. Cooking facilities are not permitted in any homestay bedroom or any exclusive homestay area. For the purpose of this regulation, cooking facilities include any refrigerator in excess of seven cubic feet; any stovetop range that operates on 220 volt electric service; any appliance that operates on natural gas; or any cooktop, whether integrated into a countertop or a separate appliance, which contains more than two cooking surfaces or burners.
Thanks @Chris Martin - I missed that. Is there any guidance on whether or not a studio apartment (one room plus a separate bathroom) would count as a "guest room"?
Do you think it would be legal to rent out two of these units and comply with this ordinance?
Thanks @Chris Martin - I missed that. Is there any guidance on whether or not a studio apartment (one room plus a separate bathroom) would count as a "guest room"?
Do you think it would be legal to rent out two of these units and comply with this ordinance?
I am not an attorney and cannot offer legal advice. In the second paragraph of my first post I provided my layman's opinion (not legal opinion, advice, or counsel (from NC Bar Opinion 2002-1)) about the ordinance. Perhaps a NC licensed attorney in BP Nation can provide a pro bono post to help.
Sidebar: One thing is clear from this Homestays ordinance... operators cannot scale this model as a "business" because there needs to be a full-time, homestay operator living "at the premises and must also be present for the entire time a homestay lodger is on property." So, in my mind, I don't even consider this activity as a viable business. It's more like a lifestyle than a business. IMO.
Another interesting development is that many of the lenders, especially agency lenders (Fannie Mae + Freddie Mac), are now not allowing short term rentals on the assets in which they lend. These stipulations are being added to all loan docs across the country now. So be sure to check with your lender before acquiring but also now if you already have debt on the asset.
Another interesting development is that many of the lenders, especially agency lenders (Fannie Mae + Freddie Mac), are now not allowing short term rentals on the assets in which they lend. These stipulations are being added to all loan docs across the country now. So be sure to check with your lender before acquiring but also now if you already have debt on the asset.
Can you provide some clarification? Do you have a link to a Fannie Mae page that says they "are now not allowing short term rentals on the assets in which they lend"? What asset classes? Primary residence only? If I have a non-owner occupied loan, I can't provide a short-term rental? What? I hope they didn't write this policy rule as poorly as the Second Home Rider that, now (revised 4/19,) clearly allows short-term rentals.
For income verification purposes (Selling Guide section B3-3.1-08) short-term rental income from a 1-unit principal residence is not eligible as part of income assessment... but that is completely different than what you posted.
I wanted to add to this thread to let anyone interested in short-term rentals in the Raleigh / Durham / Chapel Hill area know that there's a new TREIA subgroup focused on STRs that meets on Fourth Fridays over lunch at Prestonwood Country Club in Cary. (Note there is a cost for venue / food, but TREIA is non-profit)