It seems rarely a week goes by without a call from someone that would love to buy a second home but they would need it to also serve as an investment property in order to make the numbers work. It can often mean the difference between buying now or waiting until you retire, of course not knowing what prices will be like at that point. But Virginia lake homes can come with some issues that might derail your plans of renting out your home on a short term basis.
If you’ve ever vacationed in large beach and lake areas you may have rented someone’s private home during high season. Virginia’s residential lakes are mostly situated in smaller rural communities however, and so neighbors are not necessarily open to homes next door having rotating guests each week. Across the nation, states, counties and cities have been enacting legislation and laws to gain control over short term rentals that have become popular online through services like AirBNB. These services allow whole houses or even just bedrooms to be rented out on a short term basis as short as one night.
State and Local Short Term Rental Ordinances
Virginia recently passed SB1578 which gives local governments the ability to adopt ordinances that require owners to register their property for short term rentals. The law gives local governments the ability to charge fees, collect taxes and impose a $500 fine if caught renting your property without having registered. The law also requires owners to have a Virginia ABC license if they intend to serve alcohol to their guests, which could include the simple act of leaving a bottle of wine for your guests to enjoy.
Local short term laws have been enacted in some of the larger areas such as the Virginia Beach and Hampton Roads area which requires registration and tax collection or a $1000 bond, with an enforced $1000 fine if not registered. Other areas such as Prince Williams County currently require short term rentals to follow the rules and zoning requirements for Bed and Breakfasts with potential adoption of a short term rental law coming in 2018. As we see more owners wanting to do short term rentals we will likely see adoption of rules in other cities as well.
Once you have cleared the city and county boundaries, if the lake has an active HOA you may still have a hurdle. Many HOA deeds or rules exclude rentals shorter than 60 days. This is currently true in Lake Holiday. Of course if you want a community that doesn’t allow short term rentals that could be a benefit!
It is important for you to inquire about local rules for short term rentals at the city, county, and HOA levels before you invest in any lake property you may want to rent out short term. Local rules are always changing, so don’t rely on potentially dated information, make sure you ask your agent about any changes coming!