Have you ever wondered whether renting out your property using VRBO qualifies as a commercial use as opposed to a residential use? You’re not alone.
On one hand, earning income from rent, advertising for new tenants, managing and scheduling those tenants, and maintaining the property to comply with the regulations required to frequently rent out your property for short periods certainly sounds like a business.
On the other hand, it’s your residence, and the people paying you to stay in it are only using it to eat, sleep, and do other ordinary acts incident to living. They aren’t using your place to produce income for themselves.
While both sides seem to have a reasonable argument, a recent Florida appellate court decided that renting a home to someone who uses the home “for ordinary living purposes such as sleeping and eating” qualified as a residential use under that particular association’s governing documents. See, Santa Monica Beach Property Owners Association v. Acord, (Fla. App., 2017).
What is the Legal Scoop?
While frequently renting your place on VRBO may qualify as a “residential use,” be careful that your use of VRBO doesn’t violate some other provision of the covenants and restrictions or land use regulations governing your property. For example, you may have seen ABC-7’s recent story on how the City of Cape Coral is considering imposing new regulations on vacation rentals.
Moreover, if you plan to buy a property with the intent to rent it out, do your due diligence to make sure the rules regulating the property will allow you to do what you want.
For those of you in community associations trying to restrict or eliminate the use of VRBO in your community, make sure your restrictions explicitly spell out the types and terms of rentals you want to allow and those you wish to prohibit.
If you have any questions or concerns about renting your home on VRBO or preventing residents in your community from doing so, please feel free to contact one of Henderson Franklin’s Real Estate attorney at 239-344-1100.