By Andrea Murdock Real Estate January 16, 2018
Wisconsin is a popular destination for tourists. With coastlines on two Great Lakes, rolling hills dotted with farms, expansive forests offering the unforgettable smell of pine, and many cultural attractions in its two largest cities—Milwaukee and Madison—tourists find plenty of reasons to escape to Wisconsin.
After settling on a destination, the next question for most travelers is where to stay. Hotels and resorts have been the traditional option for years, but tourists are now more frequently turning to vacation rentals as a lodging option. Homeowners advertise their homes for rent on websites like Airbnb and VRBO (Vacation Rental By Owner), and travelers snap up these properties for a weekend or week or two, citing the draw of being able to house their entire family or group under one roof and have a unique backdrop for their vacation memories. It seems like a win-win for homeowners and travelers.
Local Ordinances for Vacation Rentals
But vacation rentals have a spotted history in Wisconsin, with local municipalities enforcing varying laws regarding vacation home rentals. With different laws being enforced by each county, city, town, and village, and with at least one local zoning agency enforcing what were mere guidelines outlined in an unpublished memo tucked away in a file cabinet for years, homeowners were often left guessing what they were and were not allowed to do when renting their homes.
Murdock Law has helped many homeowners challenge enforcement actions by local zoning agencies trying to shut down vacation rentals. We were delighted, then, last fall when state legislators took action to allow short-term rentals, within certain guidelines.
New Wisconsin Vacation Rental law
Effective September 23, 2017, Governor Walker signed into law the 2017-2019 state budget (2017 Wisconsin Act 59) That state budget includes some provisions relating to short-term rentals of residential dwellings in Wisconsin. Here are the highlights of the new law:
- Short-term rentals are now defined as “a residential dwelling that is offered for rent for a fee and for fewer than 29 consecutive days.”
- Municipalities are permitted to enforce local room taxes on owners of short-term rentals, subject to certain caps.
- Cities, villages, towns, and counties are prohibited from enacting or enforcing an ordinance that prohibits the rental of a residential dwelling for 7 consecutive days or longer.
- If a residential dwelling is rented for periods of between 7 and 28 consecutive days, cities, villages, towns, and counties may limit the total number of days within any consecutive 365-day period that the dwelling may be rented to no fewer than 180 days, and they may require that the days run consecutively.
- Anyone who maintains, manages, or operates a short-term rental for more than 10 nights each year is now required to obtain a tourist rooming house license from the Wisconsin DATCP and also obtain a license for conducting such activities from the city, village, town, or county if any of these enact an ordinance requiring such a license.
In short, Wisconsin homeowners may now rent their houses on a short-term basis for periods of one week or longer, but local governments may impose a tax on such rental activity and may require that the rental activity be limited to 180 days, consecutive or non-consecutive. Homeowners may also have to obtain state and local licenses to rent their properties, depending on how frequently they rent and the licensing laws of the village, town, city, or county where their properties are located. Even with these restrictions, the new State law was welcome news for many homeowners who have opened up their homes to travelers from across the United States and even from other countries.
If you are a homeowner who wants to offer your house for vacation rentals, be sure to keep your rental activity in line with the new State law and watch for any changes to local laws regarding short-term rentals so that you can ensure that you are in compliance. Reach out to the attorneys at Murdock Law if you need additional guidance.
Now, if you are a homeowner who has been renting your house to tourists for years, sometimes for less than one-week periods, you may be asking whether you can continue renting for weekends or other periods of less than one week. The short answer is: Maybe. Depending on your use of the property, you may be able to establish your property as an existing nonconforming use under what are colloquially referred to as “grandfather laws.” Contact the attorneys at Murdock Law if you think this might be your situation and if you need help navigating the laws. We’re here to help protect your property rights.
