Short-term rentals have been a bone of contention here in the Holy City for some time now. After much deliberation and argument both for and against short-term rentals in Charleston, the City Council finally made them officially legal in April. That’s right. All you AirBnB’ers and HomeAway enthusiasts can now legally rent your homes out to short-term vacationers—with a few very strict rules and regulations.
We’ll start with the biggest kicker: short-term rentals (STR) of whole houses are now officially banned in the City of Charleston. Under the new ordinance, homeowners are required to inhabit the home while hosting short-term guests, and no more than four adults may occupy a short-term rental at once. The homeowner doesn’t have to physically be in the home at all times while guests are there, but at least one full-time resident must sleep there each night of the renters’ stay.
In addition, hosts must apply for and obtain a short-term rental license from the city’s Department of Planning, Preservation, and Sustainability. Any home that is not occupied full-time by its owner, as determined by property tax assessments, is not eligible for short-term rental licensing. This makes investment properties ineligible for STR permits. Portions of dwellings (e.g. duplexes) and accessory dwellings (e.g. carriage houses) on a property are eligible. All STRs must also have at least three parking spaces: two for residential use and one for guests.
Rules for eligibility are based on location categories, as follows:
Category 1 refers to the Old and Historic District, which only allows properties in the National Register of Historic Places to be eligible for short-term rental.
Category 2 refers to the rest of the peninsula, with the exception of the STR Overlay Zone. Properties in category 2 must be at least fifty years old to be eligible.
Category 3 refers to the rest of the city, including incorporated areas of West Ashley, James Island, Johns Island, Cainhoy, and Daniel Island. There is no property age limit for these areas.
The STR Overlay Zone refers to the pre-existing area of Cannonborough-Elliotborough. No changes have been made in this area, with the exception of an annual permit renewal.
Like it or not, this ordinance is now official, effective as of July 10, 2018. In fact, the city has hired three individuals to serve full-time as STR enforcement officers. According to the Frequently Asked Questions section on the City’s website, “The regulations have been carefully crafted to allow the City multiple avenues of enforcement for short-term renters, property owners, and listing companies. They broaden what qualifies as a violation and allow for effectively targeted enforcement via special categories. In addition, the City has three new staff members dedicated to short term rental enforcement and ultra-modern enforcement technology.”
Those who are already operating illegal short-term rentals will not be “grandfathered in,” as some have wondered. If a property is eligible for a permit, those owners will have the opportunity to apply. Those who are not eligible must discontinue their short-term rentals under penalty of law.
In short, to determine whether or not your home is eligible to be permitted as a short-term rental, you must answer three questions.
- Is the home your primary residence, with a 4% rate of property tax?
- Does it fall within one of the three categories of eligibility as laid out above?
- Does it have at least three parking spaces?
If your answer is yes to all three of these questions, you are eligible to apply for an STR permit.
