Passaic Short-Term Rental Regulation: A Guide For Airbnb Hosts

Starting a Short-Term Rental Business in Passaic

Short-term rentals like those listed on Airbnb and VRBO are subject to specific zoning regulations in Passaic, New Jersey. The City of Passaic Zoning Code establishes permitted uses for each zoning district. Short-term rentals are not explicitly listed as permitted for use in any district.

Discussions on the BiggerPockets real estate investing forum indicate that Passaic does not currently have any specific ordinances regulating short-term rentals. One investor noted they own three two-family properties in Passaic and have never faced issues with short-term renting.

However, the city's zoning code does specify that only uses expressly permitted are allowed in each district. Renting for periods less than 30 days may be considered a hotel or transient use rather than a permitted residential use. This interpretation could prohibit short-term rentals in residential zones.

Passaic's rent control ordinance also presents obstacles for short-term rental operators. Landlords must keep detailed rental logs for each unit subject to inspection. The ordinance caps rent increases based on number of rooms, which is incompatible with dynamic pricing on platforms like Airbnb.

While Passaic lacks STR-specific regulations, the zoning code and rent control law make operating short-term rentals risky. Hosts could face fines or legal challenges for violating these ordinances.

Investors have had better luck with short-term rentals in nearby towns like Jersey City and Newark, which have passed ordinances explicitly allowing and regulating STRs. These cities require permits and charge taxes on Airbnb-style rentals.

North Jersey towns are increasingly moving to either formally allow or ban short-term rentals. At least 10 municipalities, including Fort Lee, Paramus, and Ridgewood, prohibited rentals under 30 days in 2017. Meanwhile, Jersey City and Newark created a legal framework for STRs.

Passaic officials have not yet taken a clear stance on short-term rentals. However, given the restrictive zoning and rent control policies, STR operators face an unfavorable regulatory environment. Hosts should carefully review Passaic's ordinances and consider the legal risks before listing on Airbnb or VRBO. Nearby cities with clearer STR regulations may provide a safer option for investors interested in the short-term rental market.

Short-Term Rental Licensing Requirement in Passaic

Passaic does not have a specific ordinance regulating short-term rentals like Airbnb and VRBO. The city's zoning code does not explicitly list short-term rentals as permitted in any district. This means renting for periods less than 30 days may be considered a hotel or transient use rather than a permitted residential use, effectively prohibiting short-term rentals in residential zones.

Discussions on real estate investing forums indicate that some Passaic property owners have operated short-term rentals without facing enforcement issues so far. However, the lack of clear regulations means STR hosts are in a legal gray area and could be at risk of fines or challenges for violating zoning laws.

Passaic's rent control ordinance also complicates short-term rentals. Landlords must keep detailed rental logs for each unit subject to inspection. The ordinance caps rent increases based on number of rooms, which is incompatible with dynamic pricing on platforms like Airbnb.

While Passaic does not require licenses specifically for short-term rentals, the city has a general rental property registration requirement. Landlords must file a registration statement with the Division of Housing for each rental unit, providing details like the monthly rent for each unit and names of all occupants. Failure to register can result in fines.

Other New Jersey cities like Jersey City and Newark have passed ordinances explicitly allowing and regulating short-term rentals. These cities require STR operators to obtain a permit, pay registration fees, undergo inspections, secure liability insurance, and remit taxes.

However, many towns in the region have moved to prohibit short-term rentals under 30 days, citing quality of life issues. At least 10 Bergen and Passaic counties municipalities banned rentals less than 30 days in 2017. More towns like Rutherford are considering restrictions on Airbnb-style rentals in response to resident complaints.

Passaic hosts operate in risky territory without municipal regulations permitting short-term rentals. The zoning code and rent control provisions present obstacles to running STRs. Operators should carefully review city ordinances, consult local officials, and consider legal counsel before listing on Airbnb or VRBO. Prospective hosts may find a more favorable regulatory environment in nearby cities like Jersey City and Newark that have established STR licensing programs.

Required Documents for Passaic Short-Term Rentals

While Passaic does not currently have a specific permitting process for short-term rentals, property owners must still comply with the city's general rental regulations. This includes registering each rental unit with the Division of Housing by filing a Landlord-Tenant Registration Form.

The registration form requires landlords to provide detailed information about the property, including:

• The address and apartment number of each rental unit
• The name, address, and phone number of the property owner
• The name and phone number of the superintendent or managing agent, if applicable
• The name and phone number of the fuel supplier and person responsible for maintaining heat in the building
• The name of each tenant and the monthly rent charged for each unit

In addition to the registration form, landlords must have a valid Certificate of Occupancy on file with the Division of Housing for each rental property. If no Certificate of Occupancy is on file, property owners have 30 days from submission of the registration form to apply for one.

Passaic's rent control ordinance also mandates that landlords maintain a detailed rental log book for each apartment in their buildings. The log must record the apartment number, tenant name, monthly rental, and lease commencement and expiration dates. These records are subject to inspection by the city.

While not currently required for short-term rentals, it is advisable for hosts to maintain similar documentation, including:

1. Proof of ownership of the rental property
2. Contact information for the owner and any designated property manager
3. Tenant information and rental rates charged
4. Copies of any lease agreements
5. Records of rental income and occupancy

Thorough recordkeeping can help short-term rental operators demonstrate compliance with Passaic's housing regulations and respond to any issues that may arise. Hosts should stay apprised of any potential changes to the city's short-term rental policies that may impose additional registration or documentation requirements in the future.

As Passaic officials continue to evaluate how to address the growth of Airbnb and other short-term rental platforms, hosts should take proactive steps to ensure they are adhering to all applicable local regulations. Careful attention to registration, certification, and recordkeeping requirements can help short-term rental operators avoid potential fines and maintain positive relationships with the city and community.

Passaic Short-Term Rental Taxes

Short-term rentals in Passaic, New Jersey, are subject to several state and local taxes. The New Jersey sales tax rate of 6.625% applies to all rentals of 89 nights or less. In addition, Passaic County imposes a 5% hotel occupancy tax on short-term stays.

Airbnb and other online rental platforms are required to collect and remit these taxes on behalf of hosts in Passaic. The 11.625% in state and county lodging taxes are added to the guest's bill when they book a reservation for less than 90 days.

However, these tax collection agreements only cover short-term rentals processed through the Airbnb or VRBO platform. Hosts who book stays outside of these websites are still responsible for registering with tax authorities and collecting the appropriate lodging taxes from guests.

It's important to note that Passaic's zoning code does not explicitly permit short-term rentals in residential areas. Renting for less than 30 days may be considered a hotel or transient use rather than an allowed residential use. This means STR operators could face fines or legal challenges even if they are collecting and remitting lodging taxes.

Some New Jersey municipalities have passed ordinances specifically allowing and regulating short-term rentals. Jersey City and Newark, for example, have established STR licensing and taxation rules. However, Passaic has not yet created a clear legal framework for Airbnb-style rentals.

Hosts looking to start a short-term rental business in Passaic should carefully review the city's zoning regulations and consult with local officials before listing their property. While state and county taxes apply, the lack of STR-specific ordinances creates uncertainty around compliance requirements.

Short-term rental operators must also be aware of Passaic's rent control provisions. The ordinance limits how much landlords can increase rent each year based on the number of rooms in a unit. Hosts are required to maintain detailed rental logs that are subject to city inspection.

The growth of Airbnb has prompted many New Jersey towns to either formally allow or prohibit short-term rentals. Some municipalities have banned rentals under 30 days due to quality of life concerns. As officials evaluate STR policies, Passaic hosts should stay informed of any regulatory changes that could impact their business.

New Jersey Wide Short-Term Rental Rules

While many New Jersey municipalities have enacted their own short-term rental regulations, there are also some statewide rules that apply to Airbnb and other vacation rentals.

One key provision is the New Jersey Transient Accommodations Tax, which imposes a fee on charges for rooms, apartments, or other furnished spaces rented to transients. The tax rate is 6.625% for rentals of 90 days or less, and 3.313% for rentals exceeding 90 days but less than 180 days. This tax must be collected by the host and remitted to the state.

In addition, short-term rental income is subject to New Jersey's gross income tax. Hosts must report their rental income on their state tax return and pay the applicable tax rate. They may be able to deduct certain expenses related to the rental, such as cleaning fees, supplies, and a portion of utilities and maintenance costs.

On a broader level, New Jersey's Hotel and Multiple Dwelling Law requires that any building with three or more units intended for transient or seasonal occupancy be inspected and approved by the state's Department of Community Affairs. This law applies to many short-term rentals, particularly those in apartment buildings or multi-family homes.

The Hotel and Multiple Dwelling Law also sets forth various health and safety standards for short-term rentals, including fire safety requirements, proper ventilation, adequate lighting and heating, and sufficient exits. Violations can result in fines and other penalties.

Another statewide consideration for short-term rental hosts is New Jersey's Law Against Discrimination, which prohibits discrimination in places of public accommodation. While this law is primarily aimed at hotels and traditional lodging establishments, it may apply to some larger-scale short-term rental operations. Hosts cannot discriminate against guests based on race, creed, color, national origin, ancestry, marital status, domestic partnership status, sex, gender identity or expression, disability, nationality, or sexual orientation.

It's important to note that local regulations in many New Jersey cities and towns go beyond these statewide rules. Municipalities have the authority to prohibit short-term rentals entirely, limit the number of days per year a property can be rented, require permits and inspections, restrict the areas where rentals are allowed, and impose various other conditions.

Short-term rental operators in New Jersey must carefully review state and local laws to ensure full compliance. Failure to adhere to applicable regulations could lead to significant financial and legal consequences. Consulting with a local attorney well-versed in land use and rental housing rules is advisable for hosts looking to maximize their rental income while minimizing their liability risks.

Does Passaic Strictly Enforce STR Rules?

Based on discussions in real estate investing forums like BiggerPockets, it appears that Passaic does not currently have strict enforcement of short-term rental regulations. Several Passaic landlords on BiggerPockets mentioned operating Airbnb rentals in the city without facing any issues from local authorities.

One investor noted owning three two-family properties in Passaic and never encountering problems with short-term renting. This suggests that despite the lack of STR-specific ordinances, the city is not actively cracking down on Airbnb-style rentals.

However, Passaic's zoning code and rent control ordinance do present potential obstacles for short-term rental operators. The zoning regulations do not explicitly permit STRs in residential areas, so renting for less than 30 days could be considered a prohibited hotel/transient use.

The rent control law also requires landlords to maintain detailed rental logs subject to city inspection, which is incompatible with the Airbnb model. While some hosts seem to be flying under the radar for now, the city could decide to start enforcing these provisions more strictly.

Compared to neighboring cities like Jersey City and Newark, which have passed STR-friendly ordinances, Passaic is in a gray area. Those cities have established permit systems and tax collection agreements with Airbnb. But Passaic officials have not yet taken a clear stance on short-term rentals.

Overall, Passaic seems somewhat Airbnb-friendly in practice, with a number of hosts operating without issues, according to BiggerPockets and Reddit posts. However, the lack of clear regulations means STRs are not explicitly legal. Hosts are vulnerable to potential zoning or rent control enforcement if the city decides to crack down in the future.

Passaic landlords looking to get into the short-term rental business should carefully weigh the risks. While many hosts are operating under the radar for now, a shift in the regulatory winds could quickly change the Airbnb landscape in the city. Investors may find more certainty in markets like Jersey City and Newark that have established a legal framework for STRs.

How to Start a Short-Term Rental Business in Passaic

Starting a short-term rental business in Passaic requires careful planning and compliance with local regulations. While the city does not currently have STR-specific ordinances, the zoning code and rent control provisions present potential obstacles. Here are the key steps to get started:

1. Review Passaic's zoning regulations carefully. Short-term rentals are not explicitly permitted in residential zones, so renting for less than 30 days could be considered a prohibited hotel/transient use. Consult with the zoning office and a local land use attorney to assess the legal risks.
2. Register your rental property with the Division of Housing by filing a Landlord-Tenant Registration Form. You'll need to provide detailed information about the property, owner, property manager, and tenants. A valid Certificate of Occupancy is also required.
3. Familiarize yourself with Passaic's rent control ordinance. The law limits rent increases based on number of rooms and requires landlords to maintain detailed rental logs that are subject to city inspection. This can complicate dynamic pricing and record-keeping for short-term rentals.
4. Obtain a general business license from the state of New Jersey. You'll need to register your business with the Division of Revenue and Enterprise Services. Consider forming an LLC to limit personal liability.
5. Set up occupancy tax collection and remittance. Short-term rentals are subject to New Jersey's 6.625% sales tax and Passaic County's 5% hotel tax. If listing on Airbnb, the platform should collect and remit these taxes for you. Otherwise, you'll need to register with the state and county tax offices.
6. Invest in smart home security to protect your property and guests. This can include doorbell cameras, noise monitoring systems, and keyless entry. Develop a detailed vacation rental agreement that sets clear house rules and expectations for guests.
7. Create a standout listing on Airbnb and other booking sites. Highlight your property's unique features, amenities, and proximity to local attractions. Use high-quality photos and an enticing description to attract guests. Consider hiring a professional photographer.
8. Develop a pricing and yield management strategy. Research local comps and events to optimize your nightly rates. Consider using dynamic pricing tools to automatically adjust rates based on demand. Factor in additional costs like cleaning fees and booking commissions.
9. Automate your rental operations with property management software. They can help you manage bookings, guest communication, cleaning, and reporting across multiple booking sites. This is especially helpful if you plan to scale to multiple listings.
10. Build a reliable team to help you manage the day-to-day operations. This may include a co-host, cleaning service, maintenance provider, and tax accountant. If you don't live near your rental, hiring a local property manager is essential.

While Passaic's regulatory environment poses challenges for short-term rentals, hosts who do their due diligence and operate professionally may still find success. The key is to start small, comply with all applicable rules, and provide an exceptional guest experience. As the city's STR policies evolve, be prepared to adapt your business model to stay compliant and competitive.

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

For questions about short-term rental regulations and zoning in Passaic, the best point of contact is the city's Zoning Officer. The Zoning Officer is responsible for interpreting and enforcing Passaic's zoning code, including any provisions that may apply to short-term rentals like Airbnb.

Contact information for the Passaic Zoning Officer is:

Julio Santana, Zoning Officer
Phone: 973-365-5632
Email: jsantana@cityofpassaicnj.gov
Address: 330 Passaic Street, Passaic, NJ 07055

The Zoning Officer can provide guidance on whether short-term rentals are allowed in different zoning districts and what restrictions may apply. They can also assist with applying for any required permits.

Another helpful resource is the Passaic Division of Housing, which handles rental property registration and inspections. While they don't currently have a specific short-term rental permit, they may have relevant information for hosts.

Contact info for the Division of Housing:

Phone: 973-365-5615
Fax: 973-365-5567
Email: housing@cityofpassaicnj.gov
Address: 330 Passaic Street, Passaic, NJ 07055

Prospective short-term rental operators in Passaic should reach out to these city offices for the most current and accurate information on local regulations. The zoning and housing staff can provide details on the approval process and any steps required to legally list a property on Airbnb or other short-term rental platforms.

It's important to note that Passaic's regulatory landscape around short-term rentals is still evolving. The city does not currently have an ordinance explicitly allowing or prohibiting Airbnb-style rentals. Hosts should stay in close contact with local officials to stay apprised of any potential rule changes that could impact their short-term rental business.

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

Discussions on real estate investing forums like BiggerPockets and Reddit provide some insight into how Airbnb hosts in Passaic are navigating the city's short-term rental regulations:

One Passaic landlord on BiggerPockets mentioned owning three two-family properties in the city and never facing issues with short-term renting on Airbnb. This suggests that despite the lack of STR-specific ordinances, some hosts are operating without enforcement problems so far.

However, other BiggerPockets users noted that Passaic's zoning code does not explicitly permit short-term rentals in residential areas. Renting for less than 30 days could be considered a prohibited hotel/transient use rather than an allowed residential use. This interpretation may put STR operators at risk of violating zoning laws.

Passaic's rent control ordinance also came up as a potential obstacle for Airbnb hosts on Reddit. The law requires landlords to maintain detailed rental logs that are subject to city inspection. It also caps rent increases based on number of rooms, which is incompatible with the dynamic pricing model of short-term rentals.

Some Reddit posters advised prospective Passaic hosts to carefully review the city's zoning regulations and rent control provisions before listing on Airbnb. Consulting with local officials and a land use attorney could help clarify the legal gray areas around STRs.

The consensus on these forums seems to be that while some Airbnb hosts are flying under the radar in Passaic for now, the city's existing housing laws pose compliance risks. A sudden zoning or rent control crackdown could put STR operators in a precarious position.

Both BiggerPockets and Reddit users pointed to nearby cities like Jersey City and Newark as having clearer short-term rental regulations. These municipalities have passed STR-specific ordinances that create a legal pathway for Airbnb-style rentals, with registration, tax collection, and other rules.

Overall, the online discussions paint Passaic as a regulatory gray zone for short-term rentals. While some hosts are operating without issues so far, the city's zoning code and rent control law present potential pitfalls. Airbnb hosts are advised to proceed cautiously and stay apprised of any new STR policies that may be on the horizon.

Disclaimer: While we here at BNBCalc strive to keep all of our city 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 city 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.