Condo Rentals in Florida in the Future

BY: DENISE & MELISSA STEWART

In a recent poll, over 60% of condo owners said that renting their condo is very important to them, and over 85% of people looking to buy a condo stated that being able to rent in the future is very important to their decision to purchase a condo. The difference relates to the fact that renting a condo is a good source of income, and renting while a condo is not being used, just makes sense to a lot of people.

If you are only concerned about longer term rentals, the answer is pretty simple. If your association allows rentals today, it is not likely to change those rules, and even if they do, you will be "Geandfathered" so your rights shoul not change. You should still talk to the board, and get their feelings about the rental policies. There have been situations where rentals were technically allowed, but the board will make the approval process so difficult, that they in effect prohibit you from leasing. The rest of this article has to do with short term rentals.

Over the past 10 years there has been a substantial movement in many areas, especially South Florida, in establishing more restrictive rules relating to renting of condos. The reasons for the more restrictive rules range from noisy & disruptive tenants, to an argument that tenants simply do not care enough to take care of the condo and the common elements. There is evidence that the shorter the stay, the more disruptive and noisy the tenants are, which is why Airbnb, HomeAway, VRBO and Craigslist are disliked by many associations, and many rules are adopted to prohibit owners from using these services. To make things worse for owners looking to do daily or weekly rentals, municipalities are joining forces to prohibit short term rentals. The municipalities state that additional resources are needed to answer calls for disturbances, and to cover these expenses, they  have ordinances for the collection of a rental tax. Owners are required to register, and also report and pay the rental taxes. Failure to report and pay the taxes can result in heavy fines. 

So where is this heading, and will you be able to rent your condo in the year 2025? Most agree that while the rules are getting more restrictive, there are a substantial amount of condos that will continue to allow some rentals, but very few will be around that allow weekly or daily rentals, unless they are one of the many Condo Hotels that are sprouting up around the Country. The Conrad and The W  in Fort Lauderdale are great examples of Condo Hotels. When you buy a condo in one of these buildings, you join a rental program which takes care of the renting and maintenance for you. The only issue is that these condos are very expensive and possibly out of reach of most people. The question remains, what pressures or changes to laws and condo documents can be passed or changed that would restrict your rights. The answer to this question is two-fold. The first part deals with your condo association changing its rules. It is pretty well settled that if you buy a condo today, and the condo rules or declaration allows you to rent your unit, the association will not be permitted to take this right from you. This is known as you be ing "grandfathered" in, meaning if they were to prohibit leasing in the future, under the grandfathering principles, you would still be allowed to lease your condo, until you were to sell your unit. One problem is that if you were to transfer your condo to a third party, or even a relative, your right go away. If you buy a unit, and you believe that the units value is greater because of the current rental policy, you may want to speak to the board and ask them their views on renting, and at least see if there is any current animosity. This could of course change in the future, but at least you will know starting off where the association stands.

The second are of concern is the governmental agencies which you may have to deal with in trying to rent your condo. The agencies deal with safety, collection of taxes, and other political agendas. The political agendas include the Hotel Lobbyists which would like to outlaw any short term rentals other than established hotels. The other areas are basically in a period of evolution, and you can be assured that cities and counties will be dealing with these issues for the foreseeable future, including making owners obtain licenses, and also being responsible for collecting, reporting, and paying a rental tax. Will this be enough to stop you from renting in the future? That really depends on your circumstances, and also your ability or willingness to deal with BIG BROTHER!!!

If you have any questions about condos in your area, please call, text or email Denise.