Seven years ago I purchased my first vacation home in Daytona Beach, Florida. If you have been following me for anytime, you know I love vacation rental investing and you know I promote where I live (Daytona Beach) like crazy.
Well, I have some bad news. For some reason (and there is much speculation: hotels raising hell, crotchety residents who forgot they live in a beach town, a city that seems to shun fun ever since they ran off Spring Break in the early 90's, and more), the City of Daytona Beach has decided to make it basically impossible to host a quality vacation rental except for about 28 homes on A1A an Main Street (single family residences, condos are a different story). The City will argue that there are other zones where you can own vacation rentals, but y'all, those zones are in areas where even the residents that live there warn you to lock up and stay away at night...so hosting tourists in these areas is bad for the city and bad for business.
November 24th, 2020 and January 26th, 2021: The City of Daytona Beach Special Magistrate started levying fines on short-term rental homeowners of up to $15,000 PER DAY!!!! Just for LISTING their home on a rental site such as Airbnb...doesn't matter if the homeowner ever even rented or not. I watched them fine a blind lady $7500 that rented out a bedroom for three days. I cried as she cried.
$15,000 PER DAY!!!! My understanding is that is THREE TIMES the fine for possession of Crystal Meth....a fine being imposed on otherwise law abiding, hard-working, tax-paying citizens that may just be renting out a guest bedroom! This is why it is SO important to be educated about your investments (side note: I got a fine too and had to shut down one of my properties but I was well aware of the risks involved and had calculated that in-but I also was suing the city because I still believe we have the legal right to STR our homes in non-HOA communities).
Four years ago, a group of tax-paying residents (myself included) that are a mixed variety of homeowners that rent out rooms to travelers or college kids, investors that rent out whole homes and residents that simply want to see the beachside of Daytona come back to life, sued the city to allow vacation rentals in ALL of Daytona Beach. Long story short...we lost and lost all of our appeals. That being said, for the most part, in Daytona Beach you can only rent your home six months or longer!
Wondering why your Bike Week Vacation Home in Daytona just cancelled on you? I promise, it wasn't the homeowner...it's the city telling you they want to dictate how homeowners rent their homes..even though the Federal Government has already determined vacation rental use is a residential use of a property.
Fast forward to now. COVID hits (which CLEARLY would make allowing vacation rentals a more safe way for people to travel going forward). Suddenly, the City of Daytona has yet again made another bad bet and decided that NOW is the time to start fining and shutting down vacation rentals. (Did anyone notice how deteriorated Daytona Beach got the last time we chased out a group of tourists....#SpringBreak...#Askingforafriend).
Vacation rentals that are: the nicest homes on the block, paying 12.5% bed taxes, increasing property values, bringing in investors (like myself) that invest in both vacation rentals but also in starting small businesses (like The Pallet Pub & The World's Most Famous Brewery)...investors that could open more restaurants and things to do IF they had a viable, as in financially viable, way and reason to be here...like a solidly performing vacation rental to help offset their start-up costs and make them want to CHOOSE investing in Daytona instead of other beach towns.
For residents that worry about loud parties, etc. I own both vacation rentals and long-term rentals. Here is what I know to be true:
Vacation renters that break the rules can be kicked out close to immediately...long-term renters have to go through an eviction process giving them much longer to destroy the home and bother the neighbors.
Vacation homes generate enough income in dilapidated areas like Daytona so that homes can afford (and it makes financial sense) to be updated and brought to current code, making homes safer and improving the neighborhood with nicer homes and higher values.
Vacation renters must follow the same rules as long term tenants in regards to noise ordinances, trash, parking, etc.
6 month minimum in Daytona means we are turning away Snowbirds, Corporate Relocations, travel nurses and people between home sales.
Here's the good news.
This does not change my investment strategy with vacation rentals and they are still a huge part of my portfolio-I am now looking to expand to mountains, deserts, cities and internationally!
There are plenty of towns that WELCOME all forms of quality tourism; whether you prefer to stay in hotels or private homes. These areas can make incredible investments for your portfolio if you do your research and invest right.
To my friends in Daytona and Miami and any other tourist town that is chasing away the tourism industry that makes us great-stay strong, keep up the good fight...change is the only constant. At some point these cities will realize that this change is here to stay. Please feel free to reach out to me with questions or if you want me to help you sell your Daytona home to buy a vacation home in another city that will welcome your investment.
Over the last seven years, I have become an expert in zoning in Volusia county and where you can legally purchase vacation rentals. I want to share this information with YOU! Y'all, I went from a ten-thousandaire to multi-millionaire in real estate investing. You can too!
If you want to learn more about investing in vacation rentals then join us for a Zoom on 2/10/21 6pm and learn how you too can build your portfolio and have a vacation home that others pay for (even if it's not in Daytona). DM me on Facebook @thebossladyinvestor for the Zoom link.
And guys....You. Got. This!