A short-term rental agreement or a vacation rental agreement is a legally binding document between a landlord and a tenant for a short stay at a rental property. Parties usually implement it for stays lasting one to 30 days, but it may outline an arrangement lasting as long as six months.
This document details temporary stays for higher-end rental properties, ensuring all parties understand the terms and conditions of the stay.
What to Include
Include the following details in your short-term rental agreement:
- The rental period (start and end dates)
- House rules
- Maximum number of guests permitted
- Amenities (cable TV, Wi-Fi, laundry machines, kitchen appliances)
- Property details (address and amenities)
- Rent amount and deposit information
- Check-in and check-out procedures
- Cancellation policies
What Is a Short-Term (Vacation) Rental Agreement?
A short-term (vacation) rental agreement is a legal document landlords use when renting a furnished property for short, defined periods. It differs from a month-to-month rental agreement, which offers a tenancy at will.
This rental agreement clearly defines the owner’s and guests’ expectations and protects both parties in case of damages or cancellation. Some instances when you’d use it include the following:
- Property testing: Someone may want to test living in a specific neighborhood before signing a standard lease agreement. This way, they can determine if the property is right for them without making a huge financial commitment.
- Temporary work assignments: Employees may need accommodations when they have work assignments in different cities or states.
- Temporary relocations: Natural disasters, property repairs, or other unforeseen events may cause individuals or families to need temporary housing.
- Seasonal rentals: Short-term rental agreements let property owners take advantage of seasonal demands, such as ski houses in the winter and beach houses in the summer.
- Vacation rentals: Property owners can use vacation rental platforms like VRBO and Airbnb to help travelers find accommodations for short stays, whether they’re for a few days or weeks.
You must abide by all applicable state laws when writing a short-term rental agreement. Furthermore, you must follow federal regulations, such as providing a lead-based paint disclosure form if the building was built before 1978.
Short-Term (Vacation) Rental Regulations
Local jurisdictions may have specific requirements for short-term rentals to minimize their potentially negative effects on neighborhoods and communities. For example, local governments may limit the following aspects of short-term rentals:
- Where you can rent: Some governments may limit short-term rentals to specific zoning areas or districts. For example, they may permit short-term rentals in mixed-use or commercial zones but prohibit them in purely residential areas.
- When you can rent: You may have to abide by restrictions for the frequency and duration of your short-term rentals. You may also only be allowed to rent during peak seasons of the year.
- How you can rent: Some areas implement requirements for dictating specific operational aspects. For example, you may have to adhere to nuisance or noise ordinances, maintain safety standards, and obtain the proper licenses or permits.
By City
Explore some short-term rental regulations by city:
| City | Website Announcing the Regulations | When the Regulations Went into Effect | Major Provisions |
|---|---|---|---|
| Alamosa, Colorado | Alamosa News | May 2022 | • Short-term rentals available for less than 30 days can only be in certain buildings, such as one unit in a multi-family property or a single-family home. • Owners must obtain a license (initial cost of $750 and a $300 renewal fee). • Neighbors must receive a notification when a new short-term rental license is issued. |
| Arlington, Texas | Arlington City Hall | April 2019 | • Property owners must pay a $500 nonrefundable permit fee each year. • You must have a permit for each site or address. • The maximum occupancy limit is two to a bedroom plus two, limited to 12 people total. |
| Aspen, Colorado | The Post Independent | November 2022 | • Ballot Issue 2A sets a 10% tax on investment properties and a 5% tax on nightly room rates for STRs with lodge-exempt (LE) permits. |
| Atlanta, Georgia | Atlanta Journal Constitution | March 2022 | • Hosts must pay $150 each year for a permit. • Violating the ordinance results in a $300 fine. |
| Burlington, Vermont | Seven Days | June 2022 | • Owners must live on the property in most cases, but there are some exceptions. • They pay 9% on tax revenue and an annual fee, which can be as high as $110. |
| Chattanooga, Tennessee | Chattanooga Chamber of Commerce | May 2023 | • A local contact must be available around the clock in case the guest has an issue. • Short-term rentals can't consist of more than 25% of the units in multi-family residential building. • Any property that's being rezoned from a residential to commercial property must have an 18-month cooling off period before an owner can apply for a short-term vacation rental permit. |
| Coeur d’Alene, Idaho | City of Coeur d’Alene and KREM | December 2017 | • Owners must pay a rental permit fee of $285 and an additional $180 to renew each year. • The city began requiring permits for all rental stays under 14 days, which conflicted with the previous rules. |
| Dallas, Texas | Dallas City Hall | December 2023 | • A short-term rental property can have no more than three guests per room (and a maximum of 12 guests total). • Hosts must ensure that guests limit their use of amplified sound between 10 p.m. and 7 a.m. • The minimum stay for short-term rentals is two nights. |
| Dauphin Island, Alabama | Town of Dauphin Island | January 2023 | • Hosts must pay a $135 license fee. • Inspections must occur once every three weeks. • Required minimum stays can be two or three nights, depending on the zone. |
| Dillon, Colorado | City of Dillon | March 2022 | • Any advertising for the property should include the STR license number and property occupancy. • All STR licenses expire May 31st each year. • A STR license costs $700 annually. |
| Fort Worth, Texas | City of Fort Worth Texas | February 2023 | • STRs are allowed in most industrial, commercial, and form-based districts. • STRs are not permitted in several residential districts. • Property owners must acquire a permit for $150 and pay an annual renewal fee of $100. |
| Frisco, Texas | Frisco Town Government | October 2022 | • The city allows for a maximum number of 900 STR licenses. • You can renew your license between February 20 and April 30. • The renewal fee is $250. |
| Lexington, Kentucky | City of Lexington | July 2023 | • STRs don't include motel or hotel rooms, farm dwelling units, lodging or boarding facilities, and bed and breakfast facilities. • Residential and commercial/business zones have different occupancy limits. • STRs shouldn't be used for private events. |
| Marco Island, Florida | City of Marco Island | October 2023 | • The city doesn't have restrictions for the frequency or duration of short-term stays. |
| Memphis, Tennessee | The Commercial Appeal | March 2017 | • STR property owners must obtain a license from the Division of Public Works. |
| New York City, New York | NYC Office of Special Enforcement | January 2022 | • Booking service platforms may not process transactions for unregistered STRs. • STRs must register with the OSE. |
| Tybee Island, Georgia | City of Tybee Island | October 2022 | • Residential zoning districts R-1, R-1-B, and R-2 don't allow any new STRs. • Property owners must obtain a unique location identification number. |
How to Write a Short-Term Rental Agreement
Step 1 – Check Local Requirements
1. Governing State. Make sure to check state and local laws regarding vacation rentals before you begin. Short-term vacation rentals are restricted, taxed, or held to specific requirements in some locations.
Some cities, like Austin, TX, require a short-term rental license to rent a property for less than 30 days at a time.
Step 2 – Assess your Liability
2. Assess Risk. With guests coming in and out of your property more frequently, ensure you factor in an increased risk of damage or degradation of your property.
Consider updating your insurance policy or creating an LLC for your vacation rental property to limit your personal liability and protect your assets.
Step 3 – Fill in the Owner and Guest Details
3. Owner and Guest Information. Write the property owner’s name and the guest responsible for the agreement.
Step 4 – Describe Property and Amenities
4. Property Information. In your rental agreement, including the property address, property type (house, apartment, etc.), and private and public facilities guests will have access to.
Also, list the amenities included with the property, such as:
-
- Washer and dryer
- Wifi
- Swimming pool or hot tub
- Linens and towels
- Basic cooking supplies
- Parking
Step 5 – Write Guest information
5. Guest Details. Write the names of the guest (the person signing the rental agreement with you) and all members of the rental party.
This helps ensure the property does not exceed the maximum occupancy and allows you to charge a fee or respond accordingly if any guests are not a party to the agreement.
Step 6 – Outline Rules and Policies
6. Occupancy, Visitors, Other Policies. Clearly state your policies regarding the following:
-
- Smoking
- Pets
- Visitors (not members of the rental party)
- Maximum occupancy
- Cancellation
- Damage to property and belongings
Include specific penalties (like fees or termination of the rental agreement) if the tenant doesn’t comply with a given policy.
Step 7 – Explain Check-In and Check-Out Procedures
7. Check-In and Check-Out Details. Write the arrival date and check-in time, and explain how guests can access the property.
Also, describe the check-out process, including check-out time, key drop-off, and any cleaning guests are expected to do before leaving.
If your guests require a physical key to enter the rental property, note any fees associated with lost keys in the contract.
Step 8 – Include Payment Details
8. Payment Details. Your short-term rental agreement should clearly state the rental cost (rate and total amount due), with a breakdown of local taxes, cleaning fees, and other applicable charges. Include acceptable payment methods (cash, check transfer, etc.), and the due date.
It is also a good idea to require a security deposit to protect you during a last-minute cancellation. Typically, the guest pays the security deposit when making the reservation, and the owner refunds the deposit at check-out or deducts it from the total balance.TIP
Depending on your cancellation policy, you may offer guests a partial or full refund of their deposit if they cancel with enough notice or unforeseen circumstances occur (like severe weather).
Step 9 – Sign the Agreement
9. Signatures. After the guest has read and agreed to the rental agreement terms, both parties should sign and date the agreement.
Give the guest a copy of the signed rental agreement and proof of payment for their security deposit.
Vacation Short-Term Rental Agreement Sample
Download a vacation rental contract in PDF or Word format below:
Frequently Asked Questions
Who is the short-term rental agreement for?
A short-term rental agreement is for hosts and guests. The hosts may include vacation homeowners, Airbnb hosts, and property managers, while the guests may include travelers, employees, and event planners.
This document ensures both parties understand their rights and liabilities. In all cases, it protects the host and guest from legal disputes by setting form the established terms and conditions.
Is a short-term rental agreement mandatory?
Whether a short-term rental agreement is mandatory depends on your area’s laws and regulations. The booking site you use may also require you to establish the terms in writing before you proceed.
Even if this agreement isn’t necessarily required, you can still consider having one to minimize disputes and clearly outline elements like security deposits, rent amount, responsibilities, and liabilities.
Are short-term rentals a bad investment?
Short-term rentals can be lucrative for a property owner, but you should be aware of the potential risks. For example, the fast turnover rates may make it difficult for you to generate income consistently. You may also have to invest more time and resources to abide by the strict short-term rental regulations in your area.
If you enter your investing venture with a solid plan, adequate knowledge, and a willingness to adapt, you may experience financial success. Having comprehensive vacation rental agreements with your guests can also promote a more seamless experience.