Seasonal Term Rentals
All you need to know about a seasonal term rental. A seasonal term rental is a form of property lease which only occur at certain times of the year.

A seasonal term rental is different from long-term rental. Popular lawyer and director of Larrain Nesbitt Lawyers, Raymond Nesbitt tried to differentiate between Long-term and seasonal rental using Spanish laws. In his words, ?A long-term contract is understood as a long-term lease agreement which constitutes the permanent abode of a tenant (and his family). These contracts are subject to Spain?s Tenancy Act. A seasonal lease, on the other hand, is a type of contract whereby a landlord rents a property not as a permanent abode. It can be either short-term (days, weeks) or long-term (months, years).? In Spanish Laws, tenants of a seasonal term rental are not subject to the entitlements of a tenant as spelt by Spain's Tenancy Act. Just like is observed in Spain, most countries have different laws guiding Long-term and Seasonal rentals.

Seasonal Term Rentals in the United States

Seasonal rentals are quite popular in the US. There is a high demand for vacation homes which are usually on lease on a short-term arrangement. This is why there is a lot of companies in this industry. HomeAway, Airbnb, and VRBO are some big names in the seasonal rental business. Another point that makes seasonal rental popular in the United States is that most home owners see it as an opportunity for them to earn money. 

Over time, the short-term rental business has gained a lot of ground. This has established a need to create laws to regulate the industry. Several cities have started to enact laws for the regulation of seasonal term rentals across the country. Violating these laws in some instances can call for heavy fines in some cases. For instance, violating a short-term let in Miami Beach for the first time can attract a fine as high as $20,000.

In some states, however, there are legal restrictions for short-term rentals. Apart from laws regulating the type of structure and the duration of stay, some other laws regulate the running of short-term rental businesses in the United States. These laws also vary with county and states.

Some of the most common legal restrictions include:

  • Total Prohibition: Some cities in the US totally prohibit seasonal term rentals. Often, in these regions, short-term rentals are regarded as hotels and can only operate in designated regions. A good example is San Diego, which prohibits short-term rentals in all zones. Santa Barbara in California, however, only permits short-term rentals in zones designated for hotels.
  • Multiple Dwelling Laws: Some regions also have strict policies on multiple dwelling with regards to short-term rentals. The most popular in this regard is New York’s Multiple Dwelling Law (MDL). The law only allows rentals of less than 30 days in “Class A” multiple dwellings. A Class A multiple dwelling is a building with three or more families living independently. 
  • Regulation of Number of Rental Properties in a Region: This often applies to popular tourist destinations. Laws in this area often place a restriction on the number of short-term properties in the region. For instance, there is a ban on short-term rentals in the French quarter in New Orleans. 

This is why it is important to check the short-term rental laws of a region before getting in a short-term lease as violating these laws can sometimes come with heavy fines. Although registered agents are said to make the process easier.

Also, if you’re looking at running a short-term rental business, the two major licenses needed are the General Business License and the Short-Term Rental License. 

Seasonal Term Rentals in Australia

New laws regulating Short-term rentals in Australia were put in place in 2018. The two major laws involved include:

  • the Fair Trading Act 1987 (NSW); and
  • the Strata Schemes Management Act 2015 (NSW).

The reforms basically address; 

  • a code of conduct for the short-term rental industry;
  • a registration system of property used for short-term rental accommodation; and
  • reforms to strata management powers to allow for the prohibition of certain lots to be used for short-term rental accommodation. 

Seasonal Term Rentals in the U.K

The short-term rental laws in London are a little more conservative than others. The summary of the regulations is; 

  • A person can rent their home on a short-term rental for 90 days of the calendar year without a permit.
  • Any short-term rental for more than 90 days requires a planning permit.
  • There is no limit to the number of days you can rent out a portion of your home during a calendar year as long as you are living there at the same time.
  • A tenant must have permission from the landlord to short-term rent a property.
  • A short-term rental makes on liable to council except in cases of a council tax discount.

In April 2019. Sadiq Khan, the mayor of London called for better regulation of short-term rentals in London. He stated his interest in developing a registration system for short-term rentals in London. Popular short-rental business, Airbnb, affirmed their support for the Mayor’s plan for a registration system in a press release. 

References

https://www.airdna.co/blog/short-term-rental-seasonality-...

https://www.spanishpropertyinsight.com/...lau/

https://ct.wolterskluwer.com/resource-center/articles/...considerations-for-short-term-rentals

https://www.planningportal.co.uk/applications

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