Short-term real estate rentals have always been popular in South Florida’s vacation meccas. But since the advent of websites and apps that make them available to national and international audiences, that popularity has soared. And that hasn’t gone unnoticed – especially in Fort Lauderdale, where a local ordinance was specifically enacted to “mitigate the effects of short-term vacation rentals in an attempt to make them safer and more compatible with existing neighborhoods.”

Here’s what you should know if you currently own a Fort Lauderdale property that you’d like to list on sites such as Airbnb or Vrbo, or if you want to buy a property for short term rental/vacation rental use in the Fort Lauderdale area.

Fort Lauderdale’s short-term vacation rental ordinance: the backstory

The city’s current ordinance stems from a failed attempt to ban the use of single-family homes as short-term vacation rentals back in 2010. In that particular case, a special magistrate determined that a homeowner who used her single-family residence as a short-term vacation rental violated city codes by doing so. The owner then appealed the decision to the 17th Judicial District.

On appeal, the judge determined that:

  1. The city did not have any ordinances regulating such rentals.
  2. It could not ban the activity in question based on existing zoning rules that generally prohibited commercial activity in residential neighborhoods.

As it turned out, Section 509.032(7)(b) of the Florida Statutes proved to be a major hurdle for the city in the case. That’s because this particular rule prevents a city from creating any new rules or enforcing any existing local law, ordinance or regulation banning vacation rentals or curtailing the length or frequency of vacation rentals.

Luckily, however, Florida Statute Section 509.032(7) allows a local government to regulate vacation rentals.  That paved the way for the City of Fort Lauderdale to adopt Ordinance Article X, Chapter 15 back in August 2015.

As adopted, Fort Lauderdale’s ordinance includes conditions designed to:

  • Lessen negative effects of short-term vacation rentals
  • Promote safe short-term vacation rentals
  • Enhance property values
  • Ensure that the inclusion of short-term vacation rentals contribute to greater neighborhood cohesiveness

It is is also meant to balance private property rights and short-term vacation rentals with other considerations by means of responsible development and regulatory criteria.

Requirements for certificates of compliance

Before a Fort Lauderdale home listed as a vacation rental can be occupied as such, its owner must now get a certificate of compliance.  The basic requirements for getting one are:

  • Submission of a completed registration application;
  • Payment of a registration fee paid to the City of Fort Lauderdale;
  • City and county business tax receipts;
  • A Certificate of Registration issued by the Florida Department of Revenue for purposes of collecting and remitting taxes, sales surtaxes, and transient rental taxes;
  • A Transient Public Lodging Establishment License issued by the Florida Department of Business and Professional Regulation;
  • An affidavit as proof of compliance with the City of Fort Lauderdale’s Vacation Rental Standards (set forth in Section 15-278), and all local, state, and federal laws, regulations and standards; and
  • The Vacation Rental Lease Agreement that will be used to rent the vacation rental property.

Property owners seeking certificates of compliance must also provide the name and contact information for someone who shall be available 24 hours per day, seven days per week to handle complaints and emergencies while the property is used as a vacation rental.

The cost of using a home as a vacation rental in Fort Lauderdale

The Department of Sustainable Development’s Community Enhancement and Compliance Division administers and enforces the city’s Vacation Rental Registration Program.

Accordingly, it is responsible for ensuring that vacation rental owners do not have any outstanding license or tax obligations.  It also ensures that all vacation rental properties meet minimum housing and life safety standards set forth in the ordinance detailed above. Lastly, it collects the following fees associated with the program. These include: a $350 Vacation Rental Registration Fee that covers the first two inspections (for a maximum of 4 units under the same roof); a $160 Non-Owner Occupied Vacation Rental Renewal Registration Fee; and an $80 Owner Occupied Vacation Rental Renewal Registration Fee. You can find a full fee list here.

The bottom line

So far we’ve addressed concerns that are largely relevant to current property/homeowners who may be interested in listing their Fort Lauderdale home as a vacation rental to make some extra money. But what if you are considering buying a Fort Lauderdale home and listing it as a vacation rental as a real estate investment? Clearly, the city’s climate, location, proximity to globally recognized tourist attractions make this an intriguing possibility.

However, you should be prepared to spend at least $300,000.00 to $500,000.00 to acquire a desirable property.  Secondly, you’ll need a business license. You should also be aware that inspections for these properties are mandatory. Finally, you should be aware that short-term rentals here are taxable.

In any case, seeking legal advice from a qualified South Florida business and/or real estate lawyer from the get-go is critical. Contact Eskander Loshak at (954) 334-1122 to learn more about how we can help you find the right property AND meet all of the legal requirements for a Fort Lauderdale vacation rental today.

Disclaimer