Properties covered by the phase one nightly rental covenant require that when the property is not being utilized for personal use it be made available 90% of the time for a rental through a bonafide property rental management company. With most phase 1 properties you have the flexibility to choose your own rental management company or organize your own nightly rentals. Your property does need to be occupied for it to earn revenue.

The phase two nightly rental covenant restricts owner personal use of the property to 28 days in the summer, 28 days in the winter and requires that the property is available for rentals through a property rental management company. With phase 2 properties, a rental pool situation is most commonly in place, i.e. so long as your suite is available for rent (even if no one sleeps in it that day) it is entitled to a share of any rental revenue earned. Whenever an owner is not using the suite personally, it is mandatory it be part of the rental pool.

Quarter share properties allow the owner use of the home 12 non-consecutive weeks of the year (every fourth week) or seven nights every 28 days. In most cases, every fourth year you are entitled to the two weeks that include Christmas and New Years.

Please contact your legal advisor for up to the minute legal advice on phase 1 and phase 2 nightly rental zoning. This post is for information purposes only E&OE.

Posted by Denise Brown on
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