Purchasing A House to Use as a Vacation Rental in the Austin Area

Dated: 10/07/2018

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If you’re looking for a great investment opportunity in the Austin real estate market, you may be considering purchasing a property to use as a full-time vacation rental.  With the rising popularity of websites such as AirbnbVRBO, and homeaway visitors to the Austin area have simpler ways to identify places to stay besides hotels.  Furthermore, renting out a property as a short term rental (STR) may be even more lucrative than a traditional long term rental.  
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​Unfortunately, in order to use a home as a short term rental in the Austin city limits, you must have a permit.  At this time, they are no longer issuing any more Type 2 permits.  Type 2 permits apply to single family, non-owner occupied homes.  Even if you find a home for sale that is currently operating as a STR with a Type 2 permit, that permit does not transfer with the sale of the home. 
 
Thus, if you would like to purchase a property to use as a full-time short term rental in the Austin area, you have two options.  Find a condo that allows short term rentals, or look for a property outside the city limits to use as a short term rental.  Homes located in the City of Austin’s ETJ can be used as vacation rentals, and do not require a permit.  Homes located in the LTD do require a permit; however, they do not have to pay City of Austin hotel taxes.  
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If you identify a property outside of the city limits that you would like to use as a short term rental, you must verify that there are no HOA restrictions that prohibit the use of the home as a vacation rental.  You will also want to check that the home is not in another city’s jurisdiction.  For example, the City of Lakeway has developed its own guidelines and regulations regarding short term rentals.
 
If you are looking for a property to use as a short term rental in the Austin Area, you may be interesting in reading these other posts. 


SHORT TERM RENTALS- UNDERSTANDING REGULATIONS

FINDING AN AUSTIN INVESTMENT PROPERTY TO USE AS A SHORT TERM RENTAL

Contact me today for help finding the perfect investment property for your needs.  
This post originally appeared on shesellsaustin.com
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Erika Albert

Erika Rae Albert is an Austin native who has built her business around one guiding principle, YOU always come first. Prior to joining the real estate industry, she honed her her customer service s....

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