What are short-term rental rules in Key West?
Key West has some of the most complex and restrictive short-term rental regulations in the Florida Keys. The city operates a licensing system that limits the number of short-term rental licenses available and ties rental eligibility to specific zoning designations. Buyers considering a Key West property for short-term rental income must verify license availability and transferability before purchase.
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Quick answer
- License required: Key West requires a city-issued vacation rental license for short-term rentals
- License cap: the total number of short-term rental licenses in Key West is capped creating a limited and valuable commodity
- Zoning dependent: short-term rental eligibility depends on the property's zoning designation
- Transferability: licenses may transfer with a property sale in some circumstances - verification is essential before purchase
- Transient vs residential zones: properties in transient zoning have broader rental rights than those in residential zones
- Enforcement: Key West actively enforces short-term rental regulations with fines for unlicensed operations
How Key West short-term rental licensing works
- Properties must be in an eligible zoning district to qualify for a short-term rental license
- The city has capped the total number of licenses available in residential zones meaning new licenses may not be obtainable
- Transient zoning areas such as parts of Old Town have different and generally more permissive rental rules
- Licenses are associated with the property and may transfer to a new owner but this must be confirmed during due diligence
- Minimum stay requirements and occupancy limits apply to licensed short-term rentals
- Tourist development taxes must be collected and remitted on all short-term rental income
What buyers should do before purchasing for rental income
- Verify the property's current zoning designation and whether short-term rental is permitted in that zone
- Confirm whether an existing short-term rental license is in place and whether it can transfer to a new owner
- Do not assume rental income based on neighboring properties - eligibility varies parcel by parcel
- Consult with a Key West real estate attorney or experienced local agent before making assumptions about rental rights
- Factor the value of an existing transferable license into offer price if applicable
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