The Hamptons, New York Short-Term Rental Regulation: A Guide For Airbnb Hosts

Starting a Short-Term Rental Business in The Hamptons

The Hamptons, a popular vacation destination in New York, has specific regulations for short-term rentals through platforms like Airbnb and VRBO. Before starting a short-term rental business, it's essential to understand and comply with these rules.

In Southampton, short-term rentals are allowed in most zoning districts, but owners must obtain a rental permit from the town. The permit application requires proof of ownership, a floor plan, and a safety inspection. Rentals are limited to no more than two people per bedroom plus an additional two people.

East Hampton has stricter regulations. Short-term rentals are only permitted in certain zoning districts and require a special permit from the town's Building Department. The property must also undergo a safety inspection. Rentals are limited to one group of tenants per week.

Anecdotally, a homeowner in Montauk was fined $75,000 in 2019 for illegally renting their property on Airbnb without obtaining the necessary permits. This highlights the importance of complying with local regulations.

Across the Hamptons, there are also common requirements like having working smoke and carbon monoxide detectors, posting emergency contact information, and adhering to noise and parking restrictions.

Before listing your property on Airbnb or any other platform, research the specific rules for your town and zoning district. Consult with local authorities and consider joining forums like Bigger Pockets or the Hamptons subreddit to connect with other short-term rental owners for advice and support.

With careful planning and compliance, starting a short-term rental business in the Hamptons can be a rewarding venture. The key is to understand and follow the local regulations to avoid penalties and ensure a safe and enjoyable experience for your guests.

Short-Term Rental Licensing Requirements in The Hamptons

To legally operate a short-term rental in The Hamptons, property owners must obtain the necessary permits and follow local regulations. The requirements vary by town:

In Southampton, owners must:

1. Submit a rental permit application with:

• Floor plans of the entire structure
• Property survey/site plan
• Certificates of occupancy for all structures
• Signed and notarized Residential Smoke Detector Affidavit
• Designation of Agent for Service form
• Proof of ownership

2. Pay the applicable permit fee ($150-750 based on property type/owner)

3. Undergo a safety inspection by the town or provide certification from a licensed professional

Rental permits are valid for two years. The process typically takes 1-4 weeks, assuming the application is complete and the property passes inspection.

In East Hampton, requirements include:

1. Registering the rental property with the town to obtain a Rental Registry Number
2. Submitting a notarized Rental Property Registration Form and Self-Inspection Checklist
3. Providing a copy of the Certificate of Occupancy
4. Paying a $200 filing fee for a two-year term

Short-term rentals under 15 days are limited to twice per six-month period in the rental registry. Certain conditions, like renting out a single-family home for less than two weeks, are prohibited.

Failure to obtain proper permits can result in significant fines. For example, a Montauk homeowner was fined $75,000 in 2019 for illegally renting on Airbnb without the necessary permits.

In Sag Harbor Village, effective January 1, 2024, a rental permit is required. The application process involves submitting a completed and notarized Rental Property Inspection Checklist, certified by the owner or a licensed professional.

Applications and forms can be submitted to each town's building department. It's critical for STR owners to research the specific rules for their property's location, as regulations frequently change. Consulting with local authorities and connecting with other owners through forums can provide helpful guidance in navigating the licensing process.

Required Documents for Hamptons Short-Term Rentals

To obtain a short-term rental permit in the Hamptons, property owners must submit several key documents as part of their application. The specific requirements vary by town but generally include:

1. Completed Application Form: The rental permit application, available from the town's building or code enforcement department, must be filled out completely and accurately.
2. Floor Plans: Detailed floor plans of the entire rental structure, showing the location and size of each bedroom, are required.
3. Property Survey/Site Plan: A survey or site plan of the property, drawn to scale, depicting all buildings, structures, driveways, parking facilities, and other features.
4. Certificates of Occupancy: Copies of certificates of occupancy for all structures on the rental property must be provided. If any lack a CO, a building permit application is needed.
5. Signed & Notarized Affidavits: Various affidavits, such as a Residential Smoke Detector Affidavit and Refuse Removal Affidavit, must be completed, signed, and notarized by the owner.
6. Proof of Ownership: Documentation confirming ownership of the rental property, like a deed, trust paperwork, or LLC/corporate records, is required.
7. Agent Designation Form: If using a property manager or agent, a completed Designation of Agent for Service form is necessary.
8. Safety Inspection: The rental property must pass a safety inspection, either conducted by the town or certified by a licensed professional, to ensure compliance with building, fire, and health codes.
9. Rental Registry Form (East Hampton): In East Hampton, a notarized Rental Property Registration Form and Self-Inspection Checklist are required to obtain a Rental Registry Number.
10. Application Fee: Rental permit fees vary based on property type and owner qualifications, ranging from $150-750 in Southampton. East Hampton charges a $200 filing fee for a two-year rental registry term.

These documents serve to verify ownership, ensure the safety and code compliance of the rental property, and provide necessary information to the town. Applications and forms can be obtained from the town's building or code enforcement department, and must be submitted in person or by mail along with the applicable fees. Incomplete applications can delay the permitting process.

Hamptons Short-Term Rental Taxes

Short-term rental operators in the Hamptons are subject to several types of taxes:

New York State Sales Tax: The state imposes a sales tax on the rental of hotel rooms, motels, bed and breakfasts, and similar short-term lodging. The current state sales tax rate is 4%. However, most short-term rentals in single-family homes are exempt from this tax as long as no housekeeping, food, or other common hotel services are provided.

Suffolk County Hotel/Motel Tax: Suffolk County, where the Hamptons are located, imposes a 3% occupancy tax on all rentals under 30 days. This tax is paid by the guest but collected and remitted by the host on a quarterly basis. Hosts must register with the Suffolk County Treasurer's office to receive a certificate of authority to collect this tax. As of June 1, 2023, Suffolk County increased this tax to 5.5% on all short-term rentals.

Income Tax: All short-term rental income is subject to federal and state income taxes. Hosts should report this income on their annual tax returns. The amount of tax owed will depend on the host's total income and tax bracket.

Failure to properly collect and remit these taxes can result in significant penalties. Suffolk County imposes a 5% penalty plus 1% monthly interest on late occupancy tax payments. Hosts can also face fines of up to $1000 and potential jail time for tax evasion.

However, short-term rental operators can deduct many of their expenses to reduce their taxable income. Deductible expenses may include:

1. Mortgage interest
2. Property taxes
3. Insurance
4. Utilities
5. Cleaning and maintenance costs
6. Supplies
7. Repairs
8. Depreciation

It's important to keep detailed records of all short-term rental income and expenses in case of an audit. Hosts should also consult with a tax professional to ensure they are complying with all applicable tax laws and maximizing their deductions.

While the tax requirements for short-term rentals in the Hamptons can seem daunting, hosts who stay informed and follow the rules can still operate profitable rental businesses. The key is to factor the added costs of taxes and compliance into your pricing and business model.

New York State Wide Short-Term Rental Rules

In addition to the specific regulations in The Hamptons, short-term rental hosts must also comply with New York State laws. These state-wide rules apply to all municipalities, including The Hamptons.

The primary state law affecting short-term rentals is the New York State Multiple Dwelling Law (MDL). The MDL prohibits renting out apartments in buildings with three or more units for periods of less than 30 days, unless the permanent tenant is present during the guest's stay. This means that in most apartment buildings, it is illegal to rent out an entire unit on platforms like Airbnb or VRBO for less than 30 days.

The MDL does provide an exception for "hosted" stays, where the permanent occupant is present in the unit during the rental period. In these cases, the host can have up to two paying guests at a time, as long as the guests have unobstructed access to all rooms and exits in the unit.

In 2016, New York State also passed a law making it illegal to advertise short-term rentals that violate the MDL. Fines for violating this advertising ban range from $1,000 for a first offense up to $7,500 for repeated violations.

Short-term rental income is subject to several state taxes as well:

1. New York State Sales Tax (4% on rentals of hotel rooms and similar short-term lodging, though most stays in private homes are exempt)
2. State income tax on all rental income earned

It's important to note that while the MDL's 30-day minimum primarily impacts apartment rentals, local municipalities like The Hamptons have additional restrictions that apply to all housing types, including single-family homes. Hosts must comply with both state and local regulations.

New York State's short-term rental laws aim to protect the state's housing stock, ensure guest safety, and preserve the residential character of neighborhoods. However, the rules are complex and have significantly impacted the operations of platforms like Airbnb. Hosts should carefully review both state and local requirements before listing their properties to avoid fines and liability issues.

Does The Hamptons Strictly Enforce Short-Term Rental Rules?

The Hamptons, particularly towns like East Hampton and Southampton, have some of the strictest short-term rental regulations in New York state. Compared to more Airbnb-friendly cities, The Hamptons is much less accommodating to short-term rental hosts.

East Hampton is especially aggressive in enforcing its rules, which only allow homeowners to rent out their properties for two stays of no more than 14 days each, every six months. The town has even resorted to subpoenaing Airbnb for rental records to identify and penalize hosts operating illegally.

Southampton also requires permits for short-term rentals and mandates a minimum stay of two weeks. While its enforcement may not be as strict as East Hampton's, Southampton still actively works to ensure compliance with its regulations.

Despite these stringent rules, some hosts continue to operate under the radar in The Hamptons. However, the risks are high. Fines for violating short-term rental laws can reach tens of thousands of dollars, as in the case of one Montauk homeowner who was fined $75,000 for illegally renting on Airbnb.

According to discussions on forums like Bigger Pockets and Reddit, The Hamptons is definitively not a friendly place for short-term rental hosts. The consensus is that the towns, especially East Hampton, are serious about cracking down on illegal rentals. Attempting to skirt the rules is ill-advised, as the potential penalties far outweigh any profits.

In conclusion, The Hamptons strictly enforces its short-term rental regulations and is one of the least Airbnb-friendly destinations in New York. While some hosts may still attempt to operate illegally, the towns' active enforcement and steep fines make it a very risky proposition. Those looking to run a short-term rental business would be wise to look elsewhere.

How to Start a Short-Term Rental Business in The Hamptons

Starting a short-term rental business in The Hamptons can be a lucrative venture, but it requires careful planning and compliance with local regulations. Here are the key steps to get started:

1. Research local regulations: Before investing in a property or listing your home, thoroughly research the short-term rental regulations in your specific town. Requirements vary across The Hamptons, with some of the strictest rules in Southampton and East Hampton. Understand the permitting process, zoning restrictions, and occupancy limits to ensure compliance.
2. Obtain necessary permits: Apply for the required permits with your town's building or code enforcement department. In Southampton, you'll need a rental permit which involves submitting a detailed application, floor plans, property survey, certificates of occupancy, and other documentation. Expect to pay permit fees ranging from $150-750. East Hampton has a rental registry, requiring a separate application process.
3. Prepare your property: Ensure your home is safe, clean, and well-equipped for guests. Install smoke and carbon monoxide detectors, provide fire extinguishers, and clearly mark emergency exits. Furnish the space with comfortable furniture, quality linens, and basic amenities. Consider hiring a professional cleaning service between stays to maintain a high standard of cleanliness.
4. Invest in marketing:Craft a compelling listing on popular vacation rental platforms like Airbnb and VRBO. Hire a professional photographer to showcase your property's best features. Develop a brand identity and build a website to establish credibility. Leverage social media and targeted advertising to reach potential guests.
5. Establish house rules and policies: Create a clear set of house rules and rental policies to set expectations for guests. Cover items like occupancy limits, noise restrictions, parking guidelines, and pet policies. Develop a thorough rental agreement outlining the terms of the stay, payment procedures, and cancellation policies.
6. Automate your operations: Utilize vacation rental software to streamline booking management, guest communication, and cleaning coordination. Automated tools can help you efficiently handle inquiries, send booking confirmations, and schedule turnovers. Consider partnering with a local property management company if you need additional support.
7. Price competitively: Research the rates of comparable properties in your area to ensure your nightly rate is competitive. Adjust your pricing based on seasonal demand, with peak rates during the summer months. Offer special promotions or discounts during shoulder seasons to maintain steady occupancy.
8. Prioritize guest experience: Go above and beyond to create memorable stays for your guests. Provide thoughtful touches like local treats, personalized recommendations, and prompt communication. Encourage guests to leave reviews and maintain a high response rate to build a positive reputation.
9. Comply with tax requirements: Short-term rentals in The Hamptons are subject to various taxes, including New York State sales tax, Suffolk County occupancy tax, and income tax on rental revenue. Register with the appropriate tax authorities and set up processes to collect and remit taxes accurately.
10. Stay informed and adaptable: Regularly monitor changes in local regulations and market trends. The Hamptons' rental landscape is continually evolving, so stay informed through town meetings, industry groups, and local news. Be prepared to adapt your business strategy as needed to remain compliant and competitive.

By following these steps and prioritizing compliance, guest satisfaction, and operational efficiency, you can build a successful short-term rental business in The Hamptons. Remember that starting a vacation rental requires significant time, effort, and financial investment, but with proper planning and execution, it can be a rewarding venture.

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

For questions about short-term rental regulations and permits in The Hamptons, the best points of contact are the code enforcement and building departments in each specific town:

Southampton Town Building Department
116 Hampton Road
Southampton, NY 11968
Phone: (631) 287-5700
Email: buildinginfo@southamptontownny.gov

East Hampton Town Building Department
300 Pantigo Place, Suite 104
East Hampton, NY 11937
Phone: (631) 324-4145
Email: building@ehamptonny.gov

Sag Harbor Village Building Department
55 Main Street
Sag Harbor, NY 11963
Phone: (631) 725-0224
Email: buildingdept@sagharborny.gov

These departments handle rental permit applications and can provide guidance on each town's specific requirements for short-term rentals.

For zoning questions that may impact short-term rentals, contact the planning and land management departments:

Southampton Department of Land Management
116 Hampton Road
Southampton, NY 11968
Phone: (631) 287-5710
Email: landmanagement@southamptontownny.gov

East Hampton Planning Department
300 Pantigo Place, Suite 103
East Hampton, NY 11937
Phone: (631) 324-2178
Email: planning@ehamptonny.gov

Short-term rental hosts in The Hamptons may also find it helpful to connect with other local operators through online forums and communities. Some active groups include:

1. Hamptons Hosts Forum on VRBO/HomeAway: https://community.homeaway.com/groups/hamptons-hosts
2. Hamptons Airbnb Hosts Facebook Group: https://www.facebook.com/groups/hamptonsairbnbhosts
3. East End Short-Term Rentals Subreddit: https://www.reddit.com/r/EastEndSTR/

These forums provide a platform for hosts to share experiences, ask questions, and stay up-to-date on the latest local regulations impacting short-term rentals in The Hamptons.

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

Based on discussions in online forums like Reddit and BiggerPockets, it appears that Airbnb hosts in Groton have mixed feelings about the town's new short-term rental regulations set to take effect in May 2024. Some key takeaways from these conversations:

On the Airbnb Community forum, one host started a thread titled "Zoning Regulation in Mystic CT" with the intent of organizing a group of Airbnb owners in the Groton/Stonington area to "help" the zoning commission on regulating STRs. This suggests an interest among some hosts in having a voice in shaping the regulations.

In the Connecticut subreddit, a user posted asking for recommendations on finding a short-term (3 month) rental in the Groton/Mystic area for under $2,000 per month starting in July. Commenters noted that anything near the water in that area gets much pricier in the summer months, with rates ranging from $4,000 to $10,000 per month. This highlights the seasonal nature of the Groton STR market.

On BiggerPockets, a user started a thread asking if the short-term rental strategy works in a "drive thru state" like Connecticut. While the thread didn't get many responses, it points to a perception among some investors that Connecticut may not be an ideal market for STRs compared to more popular vacation destinations.

The r/AirBnBHosts subreddit includes general discussions about challenges hosts face, from problem guests to changing regulations. While not specific to Groton, these conversations provide insight into the broader concerns of STR operators that likely apply in the local market as well.

Overall, the online discussions paint a picture of Groton hosts who are keenly aware of the regulatory environment and seasonal market dynamics. While some seem interested in engaging with local officials to influence STR policy, others express doubts about the viability of the strategy in a market like Connecticut. As the new regulations take effect, these sentiments will likely continue to evolve.

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

Based on discussions in online forums, Airbnb hosts in The Hamptons express frustration with the strict regulations and enforcement in the area:

On Reddit, one host shared their experience trying to navigate the rental permit process in Southampton, calling it "extremely prohibitive" due to the cost and inspection requirements. They believe the town is intentionally discouraging short-term rentals in residential areas.

Another Hampton Bays host on Bigger Pockets said they have resorted to only doing monthly summer rentals to avoid the short-term regulations. While they can still earn good rental income this way, they miss out on the higher nightly rates from shorter peak season stays.

Several hosts mentioned the difficulty of complying with the occupancy limits, as many vacationers expect to be able to bring extended family or multiple families under one roof. Having to turn away these larger groups has cost them bookings.

Other hosts expressed concerns about the neighbor complaint process, fearing that even one or two calls to the town could jeopardize their rental permit. Some feel the complaint system can be abused by residents who are anti-rental in general.

The consensus among Hamptons hosts is that the regulations are burdensome and hamper their ability to maximize rental revenue. However, most acknowledge that operating under the radar is not worth the risk of large fines and loss of rental privileges.

It's clear from these online discussions that strict enforcement, especially in places like East Hampton that have started subpoenaing Airbnb for host records, makes The Hamptons a challenging environment for short-term rental operators. Many wish the towns would work with them on more balanced regulations, but are not optimistic about the rules being relaxed anytime soon.

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.