What You Need to Know About Texas Short-Term Rentals

Is it legal to rent out your home for vacation purposes in Texas? That depends on where you live and when you started renting to visitors, according to the courts. This topic has become a hot-button issue for many Texans, with annoyed residential neighbors opposing the practice on one side and those seeking to cut into AirBnB’s profitable business model on the other. Let’s take a closer look at the specifics.

What is a Short-Term Rental (STR)?

According to law, a short-term rental (STR) is a temporary occupancy of 30 days or fewer. The City of Austin first began regulating STRs in 2012 when they required residential property owners to apply for vacation home rental licenses. They tightened the regulations to prohibit STRs in the homes of owners who do not reside at the property. These properties are called Type 2. Only commercially-zoned properties are eligible for STRs.

The city also added new rules in 2015, including how many renters could occupy the property at any given time and time-of-day use regulations. It then began extremely limiting the number of licenses granted and announced plans to phase Type 2 properties out by 2022.

In Fort Worth, property owners must obtain a bed-and-breakfast permit, which is only available to homes built before 1993.

Local vs. State Policies

In response to Austin, San Antonio, Fort Worth, and other cities that have effectively banned STRs, lawmakers on both sides of the issue have attempted to address it on a statewide level as of late. In April 2017, state Sen. Kelly Hancock (R-North Richland Hills) introduced Senate Bill 451, which would have limited the government’s ability to ban and over-regulate city ordinances pertaining to STRs.

Predictable Backlash

Rental property owners have joined The Texas Public Policy Foundation in opposing stringent new STR laws. The rental-advocacy group filed a lawsuit against the City of Austin, alleging that the new ordinance “violates the Texas Constitution’s Equal Protection Clause by treating residential uses differently without justification.” As of now, the lawsuit is still pending.

“It’s not constitutional for you to tell me how many people I can have come over and watch a football game just because I am staying in a short-term rental,” said Robert Henneke, general counsel and litigation director at the foundation.

Know Your Rights

While the fate of short-term rental properties hangs in the balance in the Texas legislature, it’s best to proceed with caution. If you want to rent out your residence to vacationers, be sure to check your city’s rental laws and ordinances. You may need a permit and to provide proof of met-specifications. You also need to be aware of how you can advertise the property online and what rules renters must abide by while in your space.

Get Legal Help

If you’re facing fines or a civil lawsuit regarding the use of your property, you need an experienced real estate lawyer. Contact Porter, Rogers, Dahlman & Gordon, P.C. today to schedule a free consultation with a competent and knowledgeable attorney. We have been helping Texas real estate law clients for over 50 years.

Corpus Christi: (361) 880-5808

San Antonio: (210) 736-3900

Austin: (512) 505-5900

Image of an oil pump on Texas land shared with cattle, representing severed estates.