Short Term Rentals and things to think about before buying the home to make into a short term rental.
February 17, 2018 Review Journal had 2 very interesting articles.
The 1st article talks about the crack down on short term rentals in the high-rise condos. The City of Las Vegas commissioners denied 9 short term rental applications in the Ogden high-rise due to there already being 1 approved. Per the law you cannot have short term rentals within 660 feet of each other. So whether this is a high-rise, a traditional condo complex or a single family neighborhood, once one is approved there cannot be another one within 660 feet. The theory on this is that these are residential neighborhoods, not commercial, and short term rentals are a business.
Many people argue that this “space restriction” is “restraint of trade”. But this restriction is no different than the space restrictions on liquor stores, massage establishments, adult bookstores and a number of other businesses. It is not restraint of trade. It is controlling business so residential communities are not overwhelmed with businesses where people live.
Unfortunately, right or wrong, short term rentals have received a bad reputation due to people having loud parties, drunken brawls, causing damage to neighboring homes, blocking roads with cars, and throwing trash, cans and bottles all over the neighborhood therefore denying the people that live there their right to quiet enjoyment. This is what led to the laws and the crack downs.
Many people are rushing to buy short term rentals thinking of making great fortunes from them, without being properly educated in the rules or the process.
1) You cannot have a short term rental in Clark County or Henderson. Leases must be a minimum of 30 days.
2) Many subdivisions, governed by an HOA, have rental restrictions of between minimum leases of 30 days to 1 full year.
3) The City of Las Vegas enacted a number of laws in the past couple of years restricting short term rentals. Things like you must have a business license to have a short term rental; you must collect and pay a room tax; you must get a code variance to operate a short term rental (which means you must have majority approval from the people that live in that neighborhood); there cannot be another short term rental within 660 feet; the home must meet code requirements and be inspected prior to approval and then annually; there must be a plaque on the front door of a responsible person that neighbors can call 24/7 to report any issues; if there are issues at the property where the police are called, or code violations, or damage to the neighborhood the license can be revoked. It is a $500 a day fine, plus other fees, for operating a short term rental in violation of these rules.
Understand, according to the City Commissioners, the crackdown is only just beginning. Since July 1st they have denied 111 applications for short term rentals. And they are just getting started. They are going after people, who are running short term rentals without having followed all the laws, very aggressively. Besides requiring all the short term rental websites – airbnb, VBRO, etc. – to report homes advertised on their sites, the City has hired, and is hiring more, people to scour the ads in Craigslist, Backpage and any other site that people offer things for sale or rent looking for people who are breaking the law.
The 2nd article https: //www.reviewjournal.com/business/tourism/csn-class-a-crash-course-in-operating-short-term-rentals/
talk’s about a course that is offered to teach you the laws, how to operate a short term rental business, and other information regarding the short term rental business.
Many people are upset because they have to follow all these rules. Reminds of a person that buys a home in an HOA and then is upset when they get notices, or fines, from the HOA for breaking HOA rules. You should have read the rules before you bought the home to ensure you are able to live within the rules and you are not losing money on the major investment you are making.
Before you buy a property, with the intent of making it a short term rental, make sure you know all the laws, rules and procedures. Buying any home is a major investment – hundreds of thousands of dollars – and can be a very costly mistake if you do not know what you are getting into prior to purchasing.
