Is there value in a STVR permit?

[Michael Furey]

I’m looking at flipping a house that doesn’t have a STVR permit. An ordinance was just passed that there will be no new ones issued. The area as a whole is very touristy and lots of STVRs all around. The area this house is in though is more so considered permanent residents and there are some houses with SVTR permits that are grandfathered in. I’ll be looking to market and sell this as a normal house (could still do long term rentals, or live in one part and do STVR on the separate part). Just trying to figure out a value on the house after renovations. Does the fact that it doesn’t have that permit hurt?  I would think not so much if it’s not going to be intended for that use. What are your thoughts?

[Michael Baum]

So @Michael Furey, the house is worth what it is worth based on comps in the area. Even successful STRs are valued that way for the most part.

Having said that, in the real world, a STVR permit is a valuable thing. So if it stays with the house regardless of ownership changes, that would be awesome for new owners. But you don't have one and won't be getting one so that point is moot.

You said the house is in an area that is primarily permanent residents so that is how it will be valued.

Are you allowed to short term rent part of the house without a permit if you live in another part of the space?

If it is allowed without restriction, then your remodel could reflect that in the build. You build out essentially with that in mind. Don't sacrifice the SFH living, but make it easier to close off a part of the house for a 1/1 or 2/2 or whatever as a STR. Live in one section, rent the other as a STR. The access to all the cool tourist stuff is a bonus.