Illegal Airbnb Listings are Rampant in Miami Beach
Miami Beach carries the highest penalties in the country for illegal short term rentals with fines starting at $20,000 for a first offense and increasing up to $100,000. Regardless, illegal short term rentals remain rampant in Miami Beach, particularly on sites such as Airbnb. By cross-referencing data from the Miami Beach Business Directory with the number of active listings on Airbnb, we have determined that upwards of 57% of Miami Beach’s Airbnb listings are illegal.
The Miami Beach Business Directory shows just over 1,900 business licenses for residential transient short-term rentals in Miami Beach as of March 2020. However, according to a 2019 article by the New York Times, there are over 4,500 active Airbnb listings in Miami Beach. Assuming this number has remained stable, this would mean that the remaining 2,600 Airbnb listings do not have valid Businesses Tax Receipts, and are therefore operating illegally under the city of Miami’s short term rental regulations. In other words, there are over 2X more listings on Airbnb in Miami Beach than there are legal short-term rental properties.
Property owners are not the only ones that suffer when Miami Beach vacation rentals are posted illegally. The experience is also risky for guests who may face eviction after unknowingly booking an Airbnb that does not comply with the city’s regulations. Guests have been interrupted on their vacations by code compliance officers and are sometimes even asked to leave, although Airbnb has rarely been said to offer refunds to guests in these scenarios.
Why are there so many illegal short term rentals in Miami Beach?
The high number of illegal short term rentals in Miami Beach likely boils down to the City experiencing difficulty identifying offenders. As a result of the settlement from the lawsuit between Airbnb and the City of Miami Beach, home-sharing sites are required to display the business tax receipt number and the resort tax numbers as a stamp of legality next to each listing. However, home-sharing sites are no longer expected to verify the validity of these licenses. Airbnb provides the mandatory fields for hosts to fill out and it falls on the city to verify the validity of each listing.
It would appear that the use of fraudulent license numbers is rampant across home sharing sites like Airbnb. It would also appear that the city has not found a viable solution to consistently identify fraudulent listings or to enforce the associated penalties. Enforcement seems to have been mostly sporadic following properties being reported by neighbors.
This situation has been made all the more complex following a judge’s October 2019 ruling to strike down the ordinance which set the $20,000 fees for first-time violations. This ruling was immediately appealed by the city.
The History of Short Term Rental Law in Miami Beach
Miami Beach’s Short Term Rental regulations have been in place since 2010, though the steep fines were not implemented until March of 2016. These fines range from $20,000 – $100,000 for repeat offenses, making them the highest in the country.
This ordinance was heavily enforced until being struck down in October 2019 in the conclusion of a lawsuit filed by a city resident who had been fined for a short term rental violation.
The judge ruled that the ordinance violated state law, which prohibits fines of more than $1,000 a day. The city immediately appealed the decision. Until an appellate court rules on the case, the law is still in effect and the city plans to enforce it.
Meanwhile, Airbnb was engaged in its own lawsuit with the city of Miami Beach. They filed suit in January 2019 claiming that Miami Beach’s short term rental regulations violated federal law. Why? Miami Beach was placing the onus for compliance on home-sharing websites by requiring that they display license numbers alongside listings.
This suit was settled in early August following a mediation proceeding, but the essential requirements remain in place.
How Do Florida Residents Feel About Short Term Rental Regulations?
Miami Beach’s short term rental regulations are undeniably harsh with many areas of the city being completely excluded from participating in short term rentals. This type of ban doesn’t sit well with the majority of southeast registered voters who responded to a Mason-Dixon poll:
“Do you believe state and local governments should or should not have the authority to ban homeowners from renting out their private property for less than 30 days?”
61% answered that they should NOT have such authority, while 21% said that they should, and 13% said they were not sure.
This poll also asked, “How important do you believe vacation rentals—such as beach houses, waterfront homes and hunting & fishing cabins—are as a component of Florida’s tourism industry?”
59% responded “Very Important”, 26% responded “Somewhat Important”, and only 9% responded that it was “Not Too Important” or “Not Important.
If you are considering renting out your property on a short-term basis, consult our resource on “Practicing Safe Renting” to learn how to avoid potential fines. You can also check out our other resources on short-term rentals regulations and legislation in Miami: