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What Investors Need to Know About New Short Term Rental Rules in New Orleans

What Investors Need to Know About New Short Term Rental Rules in New Orleans

March 27, 2023 By Crescent City Living

If you’re an investor looking into short-term rental opportunities in New Orleans, it’s important to stay updated on the latest regulations. The city council recently approved new rules on how short-term rentals will be governed in the city, and it’s essential to understand what they mean for your investment plans.

First and foremost, the new regulations limit the number of short-term rentals per square block. There can only be up to three short-term rentals per square, which is defined as four streets forming a square. This is an important factor to consider when looking for investment properties, as it restricts your options in certain areas.

Another key point to note is that one of the permits per square will be obtained through a lottery system. This means that not every applicant will be granted a permit, and it could come down to chance whether or not you’re able to secure a permit for your investment property. The other two permits can be obtained through a special exemption application process, which will likely involve meeting certain criteria set by the city council. (We’re not crazy about this special exemption process)

It’s also worth noting that the new regulations only allow one short-term rental permit per owner/operator. This means that if you own multiple investment properties, you’ll need to choose which one to operate as a short-term rental. Additionally, only natural persons can obtain a permit, meaning that LLCs or companies cannot obtain permits for non-commercial short-term rentals.

One of the most significant changes in the new regulations is the requirement for the owner/operator of the short-term rental to live inside the space they are renting. This means that you won’t be able to purchase a property solely for the purpose of operating it as a short-term rental. Instead, you’ll need to live in the property yourself and rent out any unused space as a short-term rental.

Finally, it’s important to note that the enforcement of these new rules starts on July 1. This means that any short-term rentals operating in violation of the new regulations after this date may face penalties or fines. As an investor, it’s your responsibility to ensure that your investment properties comply with these new regulations to avoid any legal issues.

By limiting the number of permits per city square, implementing a lottery system, and requiring owner/operators to live in the properties they rent, the city council is aiming to regulate the market and prevent the negative impacts that short-term rentals have had on our neighborhoods. Whether this is the solution that residents have been waiting for remains to be seen.

Filed Under: Investors Tagged With: short term rental

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