Middlesex County, Massachusetts Short-Term Rental Regulation: A Guide For Airbnb Hosts

What are Short-Term Rental (Airbnb, VRBO) Regulations in Middlesex County, Massachusetts?

Short-term rental regulations in Middlesex County, Massachusetts vary by city and town, as there are no county-wide ordinances. A short-term rental is generally defined as a stay of 31 days or less. Stays longer than 31 days are typically not taxed or regulated under short-term rental laws.

Starting a Short-Term Rental Business in Middlesex County

To start a short-term rental business in Middlesex County, you'll need to check the specific regulations of the city or town where your property is located. Some examples:

In Somerville, hosts must obtain a license from the city, pay a $200 fee, and have the property inspected. The property must be the host's primary residence and there are limits on the number of rental days per year.

One Somerville Airbnb host shared their experience getting licensed:

"I had to get both a state and local license. The Somerville inspectors came to inspect my apartment and I had to do small things like get a fire extinguisher. The requirements are minimal and easy to do."

In Medford, short-term rentals are only permitted in owner-occupied housing. Tents, outhouses, and other non-permanent structures are not allowed. All short-term rental units must register with the city and pay an annual fee.

Medford's short-term rental ordinance can be found in Section 94-8.4 of the city code. Violations can be reported to the Building Department for enforcement.

In summary, short-term rental regulations in Middlesex County currently vary by municipality. Prospective hosts should carefully research their local laws and weigh the potential returns against the ongoing regulatory risks and fees associated with the business model. Consulting with local officials and real estate professionals is advised.

Short-Term Rental Licensing Requirements in Middlesex County

Middlesex County itself does not appear to have county-wide short-term rental regulations or licensing requirements. Instead, the rules are determined by each individual city or town within the county. Prospective short-term rental hosts will need to check with their local city hall or town offices to determine what if any, permits or licenses are needed.

For example, in the city of Cambridge, short-term rental operators must register their rental units with the city's Inspectional Services Department. The requirements include:

• Completing a short-term rental registration application
• Paying a $100 registration fee ($50 for owner-occupied 1-3 family homes)
• Providing proof of $1 million liability insurance
• Scheduling an inspection of the rental unit
• Displaying the short-term rental certificate on the property

Failure to properly register can result in fines of $300 per violation per day in Cambridge. The city also limits short-term rentals to owner-occupied properties, prohibiting investor-owned units.

The registration process in Cambridge typically takes 1-2 weeks, depending on how quickly the city can schedule an inspection. Once approved, a short-term rental certificate is valid for 3 years.

However, the rules in Cambridge may be quite different from other cities and towns in Middlesex County. For example, the City of Somerville has its own set of short-term rental regulations that differ in some ways from Cambridge.

Therefore, it's critical that Middlesex County hosts contact their local city or town offices directly to inquire about location-specific licensing requirements, fees, and penalties. Most municipalities have this information available on their official ".gov" websites, often under headings like "Short-Term Rentals" or "Inspectional Services".

Required Documents for Middlesex County Short-Term Rentals

The specific documents required to operate a short-term rental in Middlesex County vary by city and town. However, some common requirements across municipalities include:

1. Short-Term Rental Registration Application: This is the primary form that prospective hosts must submit to their local city or town to register their short-term rental. It collects basic information about the property and host. The application is typically available on the city/town website or from the Inspectional Services Department.
2. Proof of Primary Residence: Many cities, such as Somerville and Cambridge, only allow short-term rentals in properties that are the host's primary residence. Acceptable proof includes utility bills, voter registration, or a driver's license with the address.
3. Property Owner Approval Affidavit: If the prospective host is a renter, they must submit a signed affidavit from the property owner granting permission to operate a short-term rental on the premises.
4. Proof of $1 Million Liability Insurance: Some cities like Cambridge require hosts to submit proof that their short-term rental is covered by at least $1 million in liability insurance. This can be a certificate of insurance or a rider on an existing homeowners insurance policy.
5. Floor Plans: Depending on the municipality, hosts may need to submit floor plans of the short-term rental unit showing room dimensions, exits, and smoke/CO detector locations. This is to verify compliance with building and fire safety codes.
6. Parking Plan: Some towns require a description or diagram showing the location and number of parking spaces available to short-term rental guests, to ensure compliance with local parking ordinances.

While not an exhaustive list, these are some of the most common documents required to register a short-term rental in Middlesex County. To obtain the exact requirements, hosts should visit their city/town website and contact their local Inspectional Services Department, as the rules vary widely by location.

Middlesex County Short-Term Rental Taxes

Short-term rental operators in Middlesex County, Massachusetts are subject to several state and local taxes:

1. State Room Occupancy Excise Tax: Massachusetts charges a 5.7% room occupancy excise tax on all short-term rentals of 31 days or less. This tax is paid by the guest but collected and remitted by the host.
2. Local Option Room Occupancy Tax: Cities and towns in Middlesex County can impose an additional local room occupancy tax of up to 6% on short-term rentals. The specific rate varies by municipality. For example, Cambridge and Somerville both charge the maximum 6%, while other towns may charge less or no additional local tax.
3. Convention Center Financing Fee: Certain cities and towns in Middlesex County, such as Cambridge, levy an additional 2.75% Convention Center Financing fee on room occupancy. This fee helps fund the Boston Convention and Exhibition Center and other tourism and marketing initiatives.

In total, short-term rental guests in Middlesex County can pay up to 14.45% in room occupancy taxes, depending on the exact location of the property (5.7% state tax + up to 6% local tax + 2.75% convention center fee if applicable).

Short-term rental hosts are responsible for collecting these taxes from guests and remitting them to the appropriate state and local tax authorities, typically on a monthly basis. Failure to comply can result in penalties and interest.

Tax Deductions for Short-Term Rentals

Hosts can deduct many of the expenses associated with operating a short-term rental business on their income tax returns. Some common deductible expenses include:

1. Mortgage interest and property taxes (apportioned for rental use)
2. Rental platform service fees (e.g. Airbnb, VRBO)
3. Cleaning and maintenance costs
4. Utilities (e.g. electricity, water, internet)
5. Supplies (e.g. linens, toiletries, coffee)
6. Repairs directly related to the rental activity

However, hosts cannot deduct any rental expenses if they rent the property for 14 days or less per year, as the rental income is tax-free under the "14-day rule."

It's important to keep detailed records and consult with a tax professional to ensure compliance with all tax laws and to maximize allowable deductions. Short-term rental taxation can be complex, with rules varying significantly by location.

Massachusetts Wide Short-Term Rental Rules

In addition to any city or town-specific regulations, short-term rental hosts in Middlesex County must also comply with state-wide laws that went into effect on July 1, 2019. The key requirements include:

1. Registration: All short-term rental operators must register with the Massachusetts Department of Revenue (DOR), regardless of how many days per year they rent out their property. Registration is completed online through MassTaxConnect.
2. Taxation: Hosts must collect and remit the 5.7% state room occupancy excise tax on all rentals of 31 days or less, unless the property is rented for 14 days or less per calendar year. Local taxes of up to 6% (6.5% in Boston) may also apply, depending on the city or town.
3. Insurance: Operators must maintain at least $1 million in liability insurance coverage, either through a hosting platform like Airbnb or through their own insurance policy. Hosts must notify their insurer of the short-term rental use.
4. Health & Safety: All rentals must comply with state building codes, fire codes, and health & sanitation codes. Smoke alarms and carbon monoxide detectors are required.
5. Record Keeping: Hosts must maintain detailed records of each short-term rental transaction, including rental agreements, dates, and amounts collected. These records must be retained for at least 3 years.

Failure to comply with these state-wide regulations can result in fines and penalties. The DOR has the authority to audit short-term rental operators to ensure proper registration, tax collection, and record keeping.

It's important to note that these state laws establish a baseline, but cities and towns can impose additional restrictions. For example, Cambridge and Somerville limit short-term rentals to owner-occupied properties only.

Therefore, Middlesex County hosts must carefully review both the state-wide rules and their local city or town regulations to ensure full compliance. Consulting with a local attorney or tax professional is recommended.

Does Middlesex County Strictly Enforce STR Rules?

Based on discussions among Airbnb hosts and local residents on Reddit and BiggerPockets forums, it appears that Middlesex County and its cities do actively enforce short-term rental regulations, but with varying degrees of strictness depending on the specific municipality.

Cities like Cambridge and Somerville have more stringent rules, limiting short-term rentals to owner-occupied properties only. One Somerville host shared that city inspectors came to their apartment to verify compliance with local ordinances before granting a permit. The host had to make small upgrades like installing fire extinguishers to meet the city's requirements.

In contrast, some towns in Middlesex County seem to have more covert short-term rental activity that may skirt the rules. Residents in Medford complained on Reddit about illegal Airbnb listings, including entire houses, basements, attics, and even a backyard tent with an outhouse. While these are clear violations of Medford's ordinances, the volume of such listings suggests that enforcement may be inconsistent or complaint-driven.

Overall, Middlesex County appears to be less Airbnb-friendly compared to other jurisdictions, with several of its cities enacting strict owner-occupancy requirements. Cambridge, Somerville, and Boston proper have some of the tightest short-term rental regulations in the state.

However, hosts still seem to operate profitably in Middlesex County, particularly those renting individual rooms while remaining on premises. One Somerville host reported earning 2-3x more from Airbnb than from a traditional roommate, while dealing with fewer headaches. Hosts can gross $20,000+ annually from short-term rentals in this area.

In summary, while Middlesex County has restrictive short-term rental policies on the books, actual enforcement varies significantly based on location and type of rental. Hosts should carefully review their specific town's ordinances to ensure compliance and avoid potential fines or legal issues. Owner-occupied room rentals appear to be the lowest-risk option in this county. But the demand and profit potential for short-term rentals remains strong, despite the regulatory hurdles.

How to Start a Short-Term Rental Business in Middlesex County

Starting a short-term rental business in Middlesex County requires careful planning and compliance with state and local regulations. Here are the key steps to get started:

• Research local zoning laws and regulations: Before investing in a property, thoroughly review the short-term rental regulations for the specific city or town in Middlesex County. Rules vary widely, with some municipalities like Cambridge and Somerville only allowing owner-occupied rentals, while others may have fewer restrictions. Zoning laws may limit the number of rental days per year, number of guests, and type of property that can be used for short-term rentals.
• Register with the state and obtain necessary licenses: As of July 1, 2019, all Massachusetts short-term rental operators must register with the Department of Revenue (DOR), regardless of the number of rental days per year. Register online through MassTaxConnect. Additionally, you may need to obtain a business license and a short-term rental license from your city or town, which typically involves an inspection to ensure compliance with health and safety codes.
• Create a detailed business plan: Develop a business plan that outlines your target guests, pricing strategy, marketing approach, and projected income and expenses. Consider forming a legal business entity to protect your personal assets. Your business plan will guide your decisions and help secure financing if needed.
• Prepare your property for guests: Make sure your rental property is clean, well-maintained, and equipped with necessary amenities to attract guests. Invest in high-quality furnishings, linens, and supplies. Consider your target market when decorating and stocking the rental.
• Implement strong security measures: Install smart locks, security cameras, and other technology to protect your property and give guests peace of mind. Establish clear house rules and a thorough screening process for guests to minimize the risk of property damage or disturbances.
• List your property on popular booking platforms: Create attractive listings on Airbnb, VRBO, and other short-term rental sites. Hire a professional photographer to showcase your property's best features. Be responsive to inquiries and maintain a high response rate to build your reputation.
• Comply with tax requirements: Short-term rentals are subject to state and local room occupancy taxes, which can total up to 14.45% in some parts of Middlesex County. Register with the appropriate tax agencies and set up processes to collect and remit taxes as required. Consider using a booking platform that automatically collects and pays these taxes on your behalf.
• Understand the time commitment: Managing a short-term rental can be time-intensive, from handling inquiries and bookings to cleaning and maintaining the property. Be prepared to devote several hours per week to your rental business, or consider hiring a property manager to handle day-to-day operations.

By following these steps and staying informed about local regulations, you can successfully launch and operate a short-term rental business in Middlesex County. It's essential to do your due diligence upfront to avoid legal issues and ensure a positive experience for both you and your guests.

Who to Contact in Middlesex County about Short-Term Rental Regulations and Zoning?

To get the most accurate and up-to-date information about short-term rental regulations in your specific city or town in Middlesex County, it's best to contact your local government offices directly. Here are some key contacts:

Middlesex County Planning Department

1. Phone: (804) 758-3382
2. Address: 865 General Puller Hwy, Saluda, VA 23149
3. Website: https://www.co.middlesex.va.us/planning-zoning

City of Cambridge Inspectional Services Department

1. Phone: (617) 349-6100
2. Address: 831 Massachusetts Ave, Cambridge, MA 02139
3. Website: https://www.cambridgema.gov/inspection

Somerville Licensing Commission

1. Phone: (617) 625-6600 ext. 4100
2. Address: 93 Highland Ave, Somerville, MA 02143
3. Website: https://www.somervillema.gov/departments/licenses-and-permits

Medford Building Department

1. Phone: (781) 393-2524
2. Address: 85 George P. Hassett Drive, Medford, MA 02155
3. Website: http://www.medfordma.org/departments/building-department/

In addition to contacting your local government, connecting with other short-term rental hosts in Middlesex County can provide valuable insights and support. Some online communities to check out include:

Airbnb Community Center - Hosting Forum

Website: https://community.withairbnb.com/t5/Hosting/bd-p/listing-and-reservations

Massachusetts Short-Term Rentals Forum on BiggerPockets

Website: https://www.biggerpockets.com/forums/state-specific/massachusetts-short-term-rentals

r/AirBnB Subreddit

Website: https://www.reddit.com/r/AirBnB/

Cape Cod & Islands Association of Realtors (CCIAOR) - Short-Term Rentals Resources

Website: https://cciaor.com/shorttermrentals

By utilizing these government and community resources, you can ensure you have the most relevant information to successfully operate your short-term rental business in compliance with Middlesex County regulations.

What Do Airbnb Hosts in Middlesex County on Reddit and Bigger Pockets Think about Local Regulations?

Airbnb hosts in Middlesex County and the greater Boston area have shared their experiences and opinions about local short-term rental regulations on forums like Reddit and BiggerPockets. Here are some key takeaways:

On the r/airbnb_hosts subreddit, one host lamented about a new 30-day minimum stay requirement in their town, stating it would not work for their market where the average stay is 4-5 days. The host had invested significantly in their property to create a highly-rated Airbnb, but may now have to switch to less profitable long-term rentals. This highlights the financial impact that restrictive regulations can have on hosts.

Another r/airbnb_hosts thread discussed the importance of strictly adhering to the number of guests allowed by local regulations and specified in the listing. Hosts advised being very strict, as guests who exceed the limit often tend to be problematic. Violations can lead to fines and legal issues for hosts.

On the BiggerPockets forums, a real estate investor asked about the legality and considerations for 2-family houses in Somerville and Cambridge that have additional attic and basement apartments. Key questions included zoning, parking requirements, utility metering, and how to properly assess these properties as 2-unit vs 4-unit. This underscores the complexity of local zoning and housing laws that hosts must navigate.

Another BiggerPockets thread revealed that as of 2019, Airbnb hosts in Massachusetts were required to register with the state Department of Revenue and display a registration number on their listing. The deadline to register was December 1, 2019. Hosts must stay informed about evolving regulations at both the state and local levels.

Overall, hosts on these forums expressed a mix of frustration with restrictive rules that can negatively impact their businesses, as well as a desire to comply with the law to avoid penalties. Many acknowledged the need to carefully research local regulations before purchasing and setting up a short-term rental property. The discussions also reflected a general trend of increasing regulation and oversight of Airbnb and other STRs in the region.

Disclaimer: While we here at BNBCalc strive to keep all of our regulation guides updated and accurate with all the latest local laws, we still do not suggest using them as your sole or primary source for local regulations. We also do not recommend you rely on the third-party sources we link to or reference, and we are not responsible for any of the information on these third-party sites. These guides are for entertainment purposes only and only provide basic information and should not be considered as legal advice.

We highly recommend directly contacting the responsible parties for each and hearing what their officials have to say. Ultimately, it's your responsibility as an investor to ensure you fully comply with the local laws, and it's best to speak with professionals before making an investment decision.