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

Schenectady, New York

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Starting a Short-Term Rental Business in Schenectady

To legally launch and operate a short-term rental business like Airbnb or VRBO in Schenectady, New York, property owners must follow several city regulations:

Landlord Registration: All rental properties that are not single-family homes or owner-occupied 2-family structures must be registered with the Schenectady Building Department. The registration requires owner information, a property agent if the owner doesn't live in Schenectady County, proof of insurance, and a notarized signature.

Rental Inspection: A comprehensive rental inspection must be passed to obtain a rental certificate before the property can be rented out. The $50 inspection fee is paid when scheduling the inspection. Any violations found must be corrected before the certificate is issued.

Rental Certificate: The rental certificate is obtained after passing inspection and is valid for the duration of the current tenant's stay. A new certificate is required each time a tenant moves out and a new one moves in. The certificate becomes invalid if a tenant is not placed within 30 days of the inspection.

Renting without a current rental certificate is a direct violation of the Schenectady city code and can result in fines, fees, and possible jail time.

In terms of zoning, Schenectady's city code lays out permitted uses and development standards for residential and non-residential districts. Short-term rentals would need to comply with the allowed uses for the property's zoning designation.

At the state level, short-term rentals under 90 days are subject to New York sales tax (4%), any local sales taxes, and local hotel/occupancy taxes, which vary by city and county. Hosts can claim tax deductions for expenses if renting the property for more than 14 days per year.

Overall, while it's possible to start an STR business in Schenectady, hosts need to carefully follow the city's rental property regulations, obtain proper permits and inspections, and stay up-to-date on any zoning restrictions or changes to short-term rental laws at the local and state level. Consulting with local officials and real estate professionals is advised.

Short-Term Rental Licensing Requirements in Schenectady

To legally operate a short-term rental in Schenectady, property owners must follow these licensing requirements according to the city's official website:

Landlord Registration: All rental properties (except single-family homes and owner-occupied 2-family structures) must be registered with the Schenectady Building Department. The registration requires:

  • Owner information
  • Property agent information if the owner doesn't live in Schenectady County
  • Proof of insurance
  • Notarized signature

Rental Inspection: A comprehensive rental inspection must be passed before the property can be rented out.

  1. The $50 inspection fee is paid when scheduling the inspection
  2. Any code violations found must be corrected before the rental certificate is issued

Rental Certificate: The rental certificate is obtained after passing inspection and is valid for the duration of the current tenant's stay.

  1. A new certificate is required each time a tenant moves out and a new one moves in
  2. The certificate becomes invalid if a new tenant is not placed within 30 days of the inspection

These documents must be submitted to the Schenectady Building Department. The timeline depends on how quickly an inspection can be scheduled and passed. Inspections are usually available within a few weeks of the request.

Renting without a current rental certificate is a direct violation of Schenectady city code. Penalties can include:

  1. Fines starting at $150 and increasing by $150 for each subsequent offense
  2. Possible imprisonment up to 15 days
  3. The city can also take legal action against the property

So, in summary, short-term rental operators in Schenectady must register as a landlord, pass a rental inspection, obtain a rental certificate, and keep the certificate current in between tenants. Failure to do so can result in significant fines and legal consequences. Prospective hosts should start the process well in advance of their intended rental start date.

Required Documents for Schenectady Short-Term Rentals

To legally operate a short-term rental in Schenectady, property owners must obtain and submit the following required documents:

Landlord Registration Form: This form registers the rental property with the city. It requires owner information, property agent information if applicable, proof of insurance, and a notarized signature. The form can be completed online through the city's website.

Rental Inspection Report: Before a property can be rented, it must pass a comprehensive rental inspection conducted by the Schenectady Building Department. The inspection checks for compliance with building codes and any safety hazards. A $50 fee is paid when scheduling the inspection.

Rental Certificate: After passing the rental inspection, a rental certificate is issued, which allows the property to be legally rented. A new certificate must be obtained each time a tenant moves out and a new one moves in. The certificate becomes invalid if the property is vacant for more than 30 days.

Building Permit (if applicable): If any repairs, renovations, or construction work is needed on the rental property, the appropriate building permits must be obtained first. Permit applications are submitted to the Building Department.

Proof of Insurance:Sufficient liability insurance is required for rental properties. Proof of this insurance coverage must be submitted with the landlord registration.

In summary, the key documents needed are the landlord registration, rental inspection report, rental certificate, applicable building permits, and proof of insurance. These ensure the property is properly registered, up to code, safe for tenants, and sufficiently insured. The Building Department handles all of these documents and processes.

Schenectady Short-Term Rental Taxes

Short-term rental operators in Schenectady need to collect and remit the following taxes:

New York State Sales Tax: The state sales tax rate is 4% of the listing price including any cleaning fees, for reservations 89 nights and shorter.

Schenectady County Hotel/Motel Room Occupancy Tax: Schenectady County charges a 5% occupancy tax on the listing price including cleaning fees, for rentals 89 nights and shorter. In 2018, the county expanded this tax to also cover short-term room-share rentals like Airbnb and Vrbo.

So, in total, short-term rental guests in Schenectady pay a 9% tax on their reservation - 4% to New York State and 5% to Schenectady County. Hosts are responsible for collecting these taxes from guests and remitting the tax revenue to the proper authorities.

Short-Term Rental Tax Deductions

On the flip side, short-term rental operators can claim several tax deductions to reduce their income tax liability. If you rent out your property for more than 14 days per year, you may be able to deduct expenses like:

  1. Mortgage interest
  2. Property taxes
  3. Rental insurance
  4. Utilities
  5. Cleaning and maintenance costs
  6. Depreciation
  7. Supplies for guests
  8. Fees paid to rental platforms like Airbnb
  9. Travel expenses related to maintaining the rental

Consult with a tax professional to determine which deductions apply to your specific situation and how to properly claim them. Keeping detailed records throughout the year will make tax time easier.

In summary, Schenectady Airbnb operators must add a 9% tax to guest reservations and send that money to the state and county. But many of the expenses of running a short-term rental are tax deductible. Understanding both the taxes owed and potential deductions allows hosts to stay compliant while maximizing their rental profits.

New York State Wide Short-Term Rental Rules

In addition to Schenectady's local regulations, short-term rental hosts must also comply with New York State laws that apply statewide:

Multiple Dwelling Law: This state law prohibits rentals of less than 30 days in buildings with three or more units unless the permanent resident is present during the guest's stay. The law aims to prevent residential buildings from being used as illegal hotels.

Sales and Occupancy Taxes: Short-term rentals are subject to state sales tax (4%) as well as any applicable local sales and hotel/occupancy taxes. As of 2023, Schenectady County charges a 5% occupancy tax on short-term rentals in addition to the state tax.

Short-Term Rental Registry Bill: In June 2024, the NY State Legislature passed a bill to create a statewide registry of short-term rentals. If signed into law by the governor, it would require hosts to register their short-term rentals with the Department of State every two years and pay a fee. The law would also mandate safety measures like evacuation diagrams, fire extinguishers, and insurance coverage.

Potential Statewide Regulations: State lawmakers have been pushing to establish consistent short-term rental regulations across New York. Proposed legislation aims to create a clear framework for taxation, registration, reporting, and safety standards that would apply to all localities outside of NYC. However, these efforts have not yet resulted in enacted statewide laws.

So, in summary, while Schenectady hosts must follow the city's specific rental permit and zoning requirements, they are also subject to the state's Multiple Dwelling Law restrictions, tax obligations, and any future statewide registry or regulations that may be implemented. It's important for hosts to stay up-to-date on evolving state and local short-term rental policies to ensure full compliance.

Does Schenectady Strictly Enforce STR Rules?

Based on discussions from real estate forums like BiggerPockets and Reddit, Schenectady appears to enforce its short-term rental regulations relatively strictly compared to other cities in New York. Several local investors and Airbnb hosts have noted that Schenectady's code enforcement department is very active in monitoring rental properties for compliance.

One Redditor shared that their neighbor operates a frequently booked Airbnb, but they had initially suspected it was "some weird human trafficking thing" due to the constant turnover of guests and out-of-state cars, indicating that STRs are not extremely common or expected in residential areas.

Another Reddit user mentioned that Schenectady requires a new rental certificate every time a tenant moves out and a new one moves in, and properties can be subject to violations and prosecution, including fines and possible jail time, for renting without a valid certificate. This strict oversight likely deters many would-be hosts from operating STRs under the radar.

While there are certainly some successful Airbnb operators in Schenectady, particularly around Proctors Theatre, Union College, and the Rivers Casino, the general consensus is that the city is not overly friendly to short-term rentals compared to other markets. The registration, inspection, and certification process is quite involved, and the penalties for non-compliance are severe.

So, in summary, although it's not impossible to run an STR business in Schenectady, hosts do have to jump through more regulatory hoops than in other cities, and the code enforcement is robust enough to discourage most from attempting to skirt the rules. Investors should be prepared to fully comply with the city's rental property ordinances if they want to operate short-term rentals in Schenectady.

How to Start a Short-Term Rental Business in Schenectady

Follow these steps to legally start a short-term rental business in Schenectady:

  1. Register as a landlord: Submit a Landlord Registration Form to the Schenectady Building Department with owner information, property agent details if applicable, proof of insurance, and a notarized signature. This registers your rental property with the city. You can complete the Landlord Registration Form online through the city's website for convenience.
  2. Schedule a rental inspection: Contact the Building Department to schedule a comprehensive rental inspection. There is a $50 fee due at the time of scheduling. The inspection checks for building code compliance and any safety hazards that need to be addressed. Thoroughly prepare your property for the inspection by reviewing the city's rental inspection checklist and making any necessary repairs or improvements beforehand. This will help you pass the inspection on the first attempt.
  3. Obtain a rental certificate: After your property passes the rental inspection, you'll receive a rental certificate which legally allows you to rent out the property. The certificate is valid for the duration of the current tenant's stay. You'll need to get a new certificate each time a tenant moves out and a new one moves in. Avoid gaps between tenants of more than 30 days, as this will invalidate your rental certificate and require a new inspection.
  4. Acquire necessary permits: If you need to make any repairs, renovations or construction to get your rental property guest-ready, obtain the appropriate building permits from the Building Department first. Factor permit fees and processing times into your startup budget and timeline. Some projects may also require special zoning approval.
  5. Obtain sufficient insurance: Short-term rental properties need robust liability insurance coverage. Provide proof of this insurance to the city as part of your landlord registration. Consult with an insurance agent experienced in short-term rental policies to make sure you have adequate coverage for your specific property and rental scenario.
  6. List your property: Once you have all your legal requirements satisfied, create an attractive listing on Airbnb, Vrbo, or other short-term rental platforms. Hire a professional photographer to showcase your property's best features. Write a detailed and inviting description, and set a competitive nightly rate based on comparable rentals in your area.
  7. Understand your tax obligations: Short-term rentals in Schenectady are subject to New York State sales tax (4%) and Schenectady County occupancy tax (5%). You'll need to collect these from guests and remit the tax revenue to the proper authorities. Keep detailed records of your rental income and expenses throughout the year. Many of the costs of running your rental are tax deductible.

By following these steps and ensuring full compliance with Schenectady's short-term rental regulations, you'll establish a solid legal foundation for your Airbnb business. From there, focus on providing an excellent guest experience to earn positive reviews and build a profitable rental operation.

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

For questions about short-term rental regulations, permits, and zoning in Schenectady, contact:

Schenectady Building Department / Bureau of Code Enforcement
City Hall - Room 17
105 Jay Street
Schenectady, NY 12305
Phone: (518) 382-5050
Fax: (518) 372-9459

The Building Department handles rental property registrations, inspections, certificates, and building permits. They can provide guidance on the specific requirements for legally operating a short-term rental in Schenectady.

For zoning inquiries or appeals, contact:

Schenectady Board of Zoning Appeals
City Hall - Room 17
105 Jay Street
Schenectady, NY 12305
Phone: (518) 382-5147

The Board of Zoning Appeals reviews applications for variances and can provide interpretations of the zoning regulations as they apply to short-term rentals.

Local Airbnb host groups and online communities can also be valuable resources for navigating the regulatory landscape and connecting with other STR operators in the area. A few to check out:

  1. Schenectady Airbnb Hosts Facebook Group
  2. Capital Region Short-Term Rental Association
  3. Schenectady Real Estate Investing Meetup
  4. Schenectady County Real Estate Investors Association

The Schenectady subreddit and Bigger Pockets Schenectady forums also have active discussions among local investors and Airbnb hosts that can provide insights.

By engaging with these local government contacts and plugging into the Schenectady short-term rental community, hosts can stay informed about current regulations and best practices for running a successful and compliant Airbnb business in the city.

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

Discussions on Reddit and Bigger Pockets reveal that Airbnb hosts in Schenectady have mixed feelings about the city's short-term rental regulations:

On Reddit, one user shared their experience operating a frequently booked Airbnb next to their house on Front St. for several years, hosting Proctors crew members, casino visitors, and even Saratoga racetrack attendees. However, they had to implement strict rules after early issues with locals renting it to party.

Another Redditor mentioned that Schenectady requires a new rental certificate every time a tenant moves out and a new one moves in. Properties can face violations, prosecution, fines and possible jail time for renting without a valid certificate, indicating that the city is quite strict about enforcing its rental regulations.

In a thread about a proposed "Good Cause Eviction" bill in New York State, a Schenectady landlord expressed concerns that such a law would make it even harder to remove problem tenants who damage property or threaten other tenants, since they can't be evicted as long as they keep paying rent. The landlord said they would likely sell their rental property if the bill passes, as it would be too difficult to manage.

On Bigger Pockets, investors note that Schenectady's code enforcement department is very active in monitoring rental properties for compliance. One poster advised including clear language in lease agreements regarding payments, late fees, evictions, deposits, and tenant responsibilities to protect against bad tenants, given New York's generally tenant-friendly laws.

So in summary, while some Schenectady Airbnb hosts have found success, especially those near key attractions, the city's strict rental inspection and certification requirements pose challenges. Coupled with New York State's proposed tenant protection laws, local hosts are concerned about their ability to operate profitably and deal with problem tenants. The consensus seems to be that Schenectady is not the easiest market for short-term rentals compared to other cities.

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.

⚡️
Reveal your property’s rental profitability

Buy this property and list it on Airbnb.