A listing for short-term rental is treated differently from an annual rental. If the home can be rented for a few weeks between the listing and closing, it is advisable to use DD Rider.
Short-term rentals are in high demand due to a thriving tourism market year-round. If you have closed the rider to the Florida Realtors/Bars contract, you must conduct a DD for vocational and seasonal rentals. This rider is intended for use only if the seller is interested in entering into seasonal or short-term rental agreements for the subject property at the time of listing. Please note that the seller still needs to enter into such agreements.
Remembering that this rider should be used for something other than annual rentals is essential. The standard 18(D) Lease information should be followed for annual rentals. If a seller’s property is subject to an annual lease, it is essential to carefully review standard 18(D) and paragraph 6, as they contain vital information on how leases are handled. Once you have specified that the seller may want to enter into short-term vacation rental agreements or seasonal – not only annual leases, you may want to include DD rider as part of your essential transactions. The rider was broken down into two parts, A and B. Here, we explain what each part covers:
- Whether the seller can enter into short-term vacation rental agreements or season.
- If the seller can do this, they can do so only with buyer pre-approval written of the rental terms and conditions. Alternatively, the seller can enter into seasonal or short-term vacation rental agreements without requiring the pre-approval of buyers.
- If the seller enters into these types of agreements, this section also requires the seller to provide the buyer with a copy of renewed or new rental agreements that the seller entered after the effective date of the sales contract.
- Part B of the rider specifically addresses seasonal occupancy agreements, which may be placed based on the seller’s property management agreement with a third party.
If the seller has the agreement, they must have the following:
- After the sales contract becomes effective, the seller must provide the buyer with a copy of all property management agreements within five days. Suppose the buyer needs to improve the terms and conditions of the property management agreement. In that case, they have the right to cancel the sales contract within five days of receiving the agreement from the seller.
- If the buyer does not cancel the sales contract, they will be held to the terms of the property management agreement for the entire duration of their occupancy agreements at the time of closing the contract.