Navigating Short Term Rental Ownership in Florida
More than 32.6 million domestic visitors took a Florida vacation in Q3 of 2022 alone, making it the second most visited state in America and a rich market for short term rentals (STR). However, the rules and regulations surrounding short term rentals vary from city to city, making it complicated and cumbersome to many second homeowners.
Whether you’re a first time vacation home owner or looking to make a little extra income on your beach house, it is possible to navigate the Florida short term rental market. It just takes some guidance on registration, regulations, and taxes on three levels: State, County, and Municipality.
Here’s our guide!
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Defining a Short Term Rental in Florida
The definition of a short term rental varies from state to state. In Florida, a short term rental is defined as ‘any individual lease agreement that is less than six months in duration.’ That’s a long duration compared to other popular tourist states like New York (30 days) or California (also 30 days), allowing for monthly rentals and making Florida even more appealing to vacation rental ownership.
Florida statute 509.242(1)(c) defines a vacation rental as “any group of units in a condominium, cooperative, or time share plan or any individually or collectively owned single-family, two-family, or four-family house or dwelling unit that is also a transient public lodging establishment” and then separates them into two property types: dwelling and condo.
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Florida State Laws Governing Short Term Rentals
No matter which Florida destination your short term rental is in, in order to be legally operating a vacation home as a short term rental in the state of Florida, property managers or hosts must first acquire a license through the Department of Business and Professional Regulation (DBPR) based on their categorization as a dwelling or a condo, and then as a Single, Group or Collective registration within their category. These are indicative of the number of properties the host represents - Single being for one home or unit, Group for multiple units in one building, and Collective applying to someone who is a host for multiple units in multiple locations.
Once you acquire the license, you can register with the Florida Department of Revenue. As the owner of the property, you’re responsible for collecting lodging taxes from guests and filing lodging tax returns with the state. As of January 2023, the state sales tax in Florida is 6% for short term rentals. So any time a guest makes a booking that is less than the legal six months total, a tax is applied and collected by the state.
Many hosting sites, like Airbnb, integrate the state taxes into the reservation experience. Airbnb collects the Florida Transient Rental Tax (6%), Florida Discretionary Sales Surtax (0.5-1.5%), and the County Tourist Development Tax (2-5%) for 24 counties in Florida as a part of their reservation. Hosts are however still responsible for collecting and remitting other taxes that are specific to their county and city.
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Registration and Taxes at the Local Level
Florida state law allows local governments to pass rules to control negative effects of vacation rentals in their area. While they can’t ban short-term rentals entirely, they have been actively attempting to control the short term rental market in recent years, as the implications of STRs on a neighborhood, hospitality offerings, and local community can’t be ignored.
A key way they’ve attempted regulation is to require additional registration and taxes at the local level. Discretionary sales surtax, local option transient rental tax, local lodging tax and more may need to be collected depending on the county and municipality you are located in.
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Navigating Your Florida County as a Short Term Rental
The first step in navigating your local requirements is to identify which county your vacation rental is in. Let’s use a condo unit in Miami Beach as an example.
Rules & Regulations
- A short-term vacation rental is for “a period of less than 30 days or one calendar month, whichever is less” (This means monthly rentals longer than 30 days would only be subject to the Florida State Sales tax, not the Miami-Dade County local option transient rental tax)
- A maximum occupancy of 2 persons per bedroom, plus 2 additional persons per property, up to a maximum of 12 persons, excluding children under the age of three
- The responsible party must reside for more than six months per calendar year in the property being offered as a vacation rental if the property falls in Low Density Residential on the CDMP Land Use Plan Map
- Compliance with designated legal safety features if a pool is onsite
- Compliance with all residential requirements pertaining to solid waste disposal, noise, public nuisance, parking, advertising, pets, and anti-discrimination, disability and fair-housing regulations
Registration & Taxes
In addition to the state registration and taxes, many counties require additional certifications or protocols. Miami-Dade County, for example, requires a Tourist Tax Account for collection of the monthly Convention and Tourist Development tax and annual inspection for and purchase of a Certificate of Use (CU).
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Adhering to Additional Municipality Guidelines
With the county regulations and registrations covered, we head to the final layer – the municipality, which in the case of our example is Miami Beach.
At the municipal level, the main restrictions they can enforce surround zoning in specific neighborhoods or areas of their city. Miami Beach City Code (Sec 142-1111) and City Code (Sec 142-905 (b)) outline the zoning restrictions for vacation and short term rentals. As you can see on their zoning map, the zoning is quite restrictive. This use of zoning to prohibit short-term rentals is common in many dense or residential vacation destinations.
Once confirming your unit isn’t in one of the restricted areas, a Business Tax Receipt and Resort Tax registration certificate can be established.
So, in order to rent a condo unit in Miami Beach, Florida for less than 30 days or one calendar month, there are the following seven steps of registration, licensing and taxes before you can list your property:
- Obtain a Florida State DBPR license (dwelling or condo)
- Register with the Florida Department of Revenue
- Florida Department of Revenue Registration & Lodging Tax - 6%
- Obtain a Miami-Dade Certifcate of Use
- Annual fee for inspection and certification - $136.17
- Check Miami Beach Zoning
- Obtain a Resort Tax Registration Certificate in the City of Miami Beach
- Obtain a Business Tax Receipt from the City of Miami Beach
- Miami-Dade County Local Option Transient Rental Tax Rate + Miami Beach Resort Tax - 7%
To make things more interesting, these laws and taxes are subject to change at the discretion of the governing body, so we recommend checking with the specific county or city government where your property is located to ensure you are adhering to the most up to date regulations.
If that all seems complicated and overwhelming, you’re not alone. Partnering with a property management company that handles all the required legal ins and outs like Rove Travel is an easy way to make the process hassle-free.
Rove’s Marketplace is another great option for people looking to invest in a vacation rental property and interested in a seamless process. Rove’s collection of vacation homes are vetted and ready to buy.
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Which Counties in Florida allow for short term rentals?
In 2011, the state of Florida passed legislation restricting counties and municipalities from banning short term rentals outright, but if a local statute was already in place, they were grandfathered in. The only county that does not allow for short term rentals today is Lafayette, though counties like Calhoun and others make it very hard with zoning restrictions.
With the growing popularity of short-term vacation rentals, many counties have implemented local option transient rental taxes to benefit from the traffic in their area. More popular counties like Orange (Orlando), Volusia (Daytona Beach), Pinellus (St. Petersburg), Osceola (Kissimmee) and Broward (Miramar & Pompano Beach) have taxes as high as 6%, compared to less populous counties like Union and Sumter, which don’t have an additional local tax at all.
Florida Counties Local Option Transient Rental Tax Rate
Which cities in Florida are most attractive for Short Term Rental Ownership?
As real estate prices skyrocket in cities like Cape Coral, picking a Florida destination for your short-term vacation rental can be guided instead by traveler trends and opportunity in the current short term rental market.
When evaluating based on search volume, the top 5 cities that travelers are seeking short term rentals in are:
- Naples: The beautiful beaches of Naples draw more than a million visitors a year. With high-end shopping, world-class arts and culture, dining and millions of protected acres nearby, the destination is a popular pick for vacationers. Short term vacation rentals located within the City of Naples are exempt from the Collier County registration requirements, but are still subject to the additional 5% Tourist Development Tax of the county.
Considering owning a short term rental in Naples? Rove Travel is well versed in the market and has an existing collection in the destination. Homeowners can seamlessly join and enjoy the benefits of both Naples and Rove’s management company.
- Tampa: Theme parks and water parks abound in this Bay-side city. Tampa sits within Hillsborough County. Their local option transient rental tax is 6%. The City of Tampa also requires a rental certificate, but no additional city taxes for STRs.
- Venice: The offshore coral reef of Venice Beach attracts over 20 million visitors annually. And with a lower county (Sarasota) tax of 5% and a sales tax of 0%, it’s an attractive city for vacation homeowners.
- Hollywood: Just south of popular Fort Lauderdale, Hollywood is a 27 square mile, beachfront community that is rich with history, culture, and a charming downtown. Located in Broward County, it has a higher local tax at 6%, but the market is missing a luxury hospitality offering, leaving short term rentals a window of opportunity.
- Florida Keys: A fishing and vacation mecca, the limited space leaves little occupancy at the hotels in the Florida Keys. And with high occupancy driving up nightly rates, vacationers are eager for the space and price afforded by a short term vacation rental. Monroe County has a local option transient rental tax of 5%, but there is little regulation of short term rentals in the county’s seat, Key West.
More Than 36 Million People Visited Florida's Beaches in Q3 of 2022
Which platform to list your short term rental on?
There are numerous websites for listing, booking, and payment for short term rentals. In Florida, if you’re looking to have at least one tax checked off your list, Airbnb and VRBO automatically collect and remit Florida state-administered lodging taxes when they receive guest payments. However, you would still be responsible for any local and county taxes.
- Airbnb: Airbnb remains the most well-known and fastest growing rental site. It’s often the first place people check, and you can benefit from the trust renters have in the brand. Additionally, listing your site on Airbnb comes with a $1 million dollar insurance policy on your property. However, while they don’t charge you to list your property, they do take a commission fee on bookings.
- VRBO: VRBO is another great option, especially if you have a larger property. They give you the choice of paying per booking or an annual fee of $499. So for premium properties in busy destinations(like many Florida cities), the annual option can be a way to save money on per booking fees.
- Booking.com & Expedia: Other popular listing sites include Booking.com and Expedia, where you can leverage the flight and rental car search functions to get in front of potential customers coming to your city. However, that exposure comes with a higher fee. Booking.com has a 15% fee for all reservations and Expedia ranges from 10-30%.
- Property Management Companies: Another route is to partner directly with a property management company like Vacasa or Rove Travel. Not only do they handle the registrations and taxes, bookings, cleanings, and customer service, they have dedicated platforms for booking that instill trust and quality.
Whether you’re a first time vacation short-term rental owner or a seasoned host, Rove Travel takes care of your home so you don’t have to. With collections in Naples, West Palm Beach, and Miami, Rove Travel has a keen understanding of the Floridashort termrental landscape and is here to help you enjoy the benefits of owning a short term rental in the Sunshine State.