Vacation Rentals and Community Associations

Vacation Rentals and Community Associations

Over the past few years, Airbnb and VRBO (collectively referred to as “Vacation Rentals”) have become a very popular form of short-term rental. Vacation Rentals include a range of rentals from houses, condos, or in some instances rooms for a period under 30 days’ at a time. While some owners believe they have this right under the concept, “I own it and can use it as I wish,” there has been a long-standing concept in Florida Law that community associations have the right to restrict perceived disruptive uses, including short term rentals within their community. Florida law has consistently upheld community covenants and restrictions regulating the level of occupancy of a unit or home. These restrictions are typically found in the association declarations which are recorded in the public records and hence put the property owner on constructive notice of their existence at the time of purchase of the unit or home. These restrictions remain enforceable, such as notice requirements prior to renting or leasing a unit, background screening of prospective tenants, etc.

It is always a balancing act between the rights of an owner to use their home as they choose and the rights of an association and other local government to regulate certain aspects of such home ownership. Section 509.032(7)(b), Florida Statutes, restricts local laws, ordinances, and regulations from prohibiting Vacation Rentals or regulating the duration or frequency of Vacation Rentals. However, that statute does not apply to any local laws, ordinances, or regulations adopted on or before June 1, 2011. This statute formerly prohibited local laws, ordinances, and regulations from restricting the use of Vacation Rentals, prohibiting Vacation Rentals, or regulating Vacation Rentals based solely on their classification, use, or occupancy. The legislature amended the statute in 2014, and it now only bars local governments from prohibiting short-term rentals entirely or regulating the frequency or duration of short-term rentals. Under the current statute, for example, a local government cannot create an ordinance that prohibits property owners from renting their property for any specific duration or limiting the number of times a property can be rented in a given year. However, as stated above, this statute has no implication on any restrictions that were already in place by any local government prior to June 1, 2011.

Despite this statutory provision, even since June 1, 2011, local governments in Florida have found methods to regulate Vacation Rentals. For example, the City of Miami Beach code bans short-term rentals in all single-family homes and only allows short-term rentals in certain zoning districts. Ft. Lauderdale recently enacted an ordinance requiring all Vacation Rentals, except timeshares, to officially register their property with the city and pass a maintenance and life safety inspection. Flagler County enacted comprehensive Vacation Rentals regulations ranging from the maximum number of occupants to the minimum number of parking spaces and garbage containers needed per guest.

Property owners have challenged some of these ordinances. For example, two property owners challenged the aforementioned Flagler County ordinance on the grounds that state law preempted the ordinance, the ordinance violated the Equal Protection Clause of the Florida Constitution, and the ordinance violated the privacy rights of the property owners. The trial judge upheld the ordinance in its entirety but found that the government could not apply the ordinance to contracts entered into before its adoption. The Fifth District Court of Appeal affirmed the holding of the trial court.

Given that Florida is a popular vacation destination, Vacation Rentals is going to continue to be a hot topic, and there is a high probability that we will see further amendments to Florida Statutes governing this issue. The legislature has put forward bills seeking amendment to Section 509.032(7)(b), Florida Statutes in 2014, 2015 and 2016. I believe this will continue to be a hotly contested issue for years to come. If the legislature continue to push amendments to the statute to allow local governments to regulate the duration and frequency of vacation rentals, which will have a significant impact on the business models of Airbnb, VRBO, and similar businesses, this will likely force these businesses to push back on such proposed legislation.

As it stands, associations still have the right to enforce the restrictions within their governing documents. This would include ensuring that no owner violates any local law or ordinance regulating Vacation Rentals. If, an association does not have a restriction on rentals, amendments may be approved by the Unit owners; however, if an association wishes to amend their documents to impose new rental restrictions altering the duration of the rental term or limiting the number of times an owner may rent their home, it is important to note that there are some statutory limitations which may implicate grandfathering of existing owners. If limiting short term rentals is something that your community association is interested in pursuing, you should discuss the issue with the association’s attorney.

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