New Regulations for Short-Term Rental Hosts in Philadelphia Have Taken Effect

New regulations have gone into effect to crack down on Airbnb hosts of short-term rental properties. They will essentially be treated as businesses. They now have to apply for lodging licenses and comply with safety code requirements that the city of Philadelphia have put into place. If the owner of the property lives in the property, they must acquire a Limited Lodging Operators License. If the owner of the property does not live in the property, they must acquire a Hotel License. This will significantly impact short-term rental hosts in Philly.

The Details:

• Philadelphia City Council approved these regulations in 2021 after some long-term Philly residents complained about Airbnb “party houses.” The residents claimed the renters were causing disturbances like excessive noise, litter and violence.

• Another complaint was not being able to get in contact with the person who is renting out the property. To help with this, property owners and anyone who is involved with renting out the property must provide their contact information on their permit applications and send them to the city’s Zoning Board of Adjustment.

• Back in 2015, the city implemented licensing requirements for short-term rentals including an 8.5% tax as well as anyone renting their home for more than 90 days needed a license. Now owners renting out for any amount of time need a license.

• It has always been illegal for owners of investment properties that they do not live in to rent out the property without a hotel license. However, some people unknowingly broke that law and the rules were not heavily enforced, according to the Philadelphia Inquirer. That is now changing.
  

Homes for Sale in Philadelphia:

The New Rules:

• Property owners who are renting out their home or a room in their home for short periods must apply for limited lodging operator and commercial activity licenses for $150 per year before they can be an Airbnb host.
  

• If owners plan to rent out the property for 30 consecutive days, they need a zoning permit.

• Property owners who don’t live in the unit they are renting out must apply for a hotel license and zoning permit. They will then have to provide the license number to companies like Airbnb and VRBO or the companies will be liable for violations. That means the online brokers will likely be more inclined to not allow those without licenses to rent their properties.

• Property owners who do live in the unit must obtain a limited lodging operator license. The license itself is not very expensive, but it does mean their property has to be up to code and that could be expensive to make some of these adjustments.

APPLY FOR YOUR LICENSE HERE

Feedback from Property Owners:

• These new regulations were supposed to go into effect in April 2022. However, property owners pushed back and said they needed more time to be able to comply with the new rules. Some said they had not been notified and others said the zoning board was so backed up they wouldn’t be able to get the licenses before the deadline. So it was pushed to take effect January 1, 2023.

• Angela Romero, who owns a triplex in East Kensington, told the Philadelphia Inquirer, “This is financially really impacting me because this is 100% of my income. I don’t know how I’m going to be able to live, and it’s giving us a very short time frame for us to figure out how to pivot.”

• Another layer to this is that there are only certain areas of the city where hotels are allowed. It’s typically in areas like Center City and University City. In other neighborhoods, property owners will have to get a zoning exception to secure their new required licenses.

• According to the Inquirer, 247 people have received a Limited Lodging Operators License and 164 received a hotel permit. That’s out of thousands of Airbnb hosts who are still going to need approval. Many owners will especially want to be in compliance by the time Philadelphia sees major events coming up like the World Cup.

Homes for Sale Under $500K:

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