Can homeowners rent their home out during Mardi Gras in New Orleans?

**Editor’s note: Can homeowners rent their home out for short-term rentals? This information below may be subject to change because this ban on short-term rentals is currently under review. **

Mardi Gras, the greatest free party on Earth, brings people to New Orleans from all over the world. Beads, parades, dancing through the streets – Mardi Gras is a party-like-no-other and a lot of local businesses benefit from the number of tourists who partake in the party. In the past, websites like airbnb.com helped homeowners take advantage of the huge tourist influx in New Orleans, but unfortunately, the idea of homeowners or renters making extra cash by short-term renting their home isn’t going to happen just yet, at least legally.

This is because the New Orleans City Council over recent years has been cracking down on illegal short-term vacation rentals. Luckily, it is possible for homeowners to rent for less than one year; the ban is on rentals less than 60 or 30 days.

 

The New Orleans ban on short-term rentals

 

The City Council and Planning Commission of New Orleans banned short-term rentals because of the impact the rentals have on the vacation rental industry. Also, in the past, short-term rental companies haven’t been very helpful in enforcing regulations on renters using their website.

The city council voted to ban unlicensed renting to nonresidents for fewer than 30 days throughout most of New Orleans and fewer than 60 days throughout the French Quarter. This means it is illegal to rent a residence to anyone for a short period of time (the law does not apply to legally operating hotels and bed and breakfasts).

City officials have warned that the first offense for advertising a short-term rental is a written warning; the second offense is a $500 fine; and the third offense is a $500 fine and 30 days in jail.

 

Will the ban on short-term rentals ever change?

 

The good news is that eventually city council will give short-term leasing the greenlight, as there are new proposed rules that would place almost no restrictions on short-term rentals. These new rules would allow the city to work with short-term rental companies like airbnb.com to ensure taxes are collected and rules are enforced.

While short term rentals have been banned, there is still insurance available to help protect your home if you are planning to rent out your residence for more than 30 days.

 

Is homeowners insurance still available for rentals lasting less than a year?

 

Regardless of the lease, a home or property cannot be protected without the right type of insurance. There are policy types that prohibit short-term rentals and therefore any damages, fire, water, liability, etc. will not be covered. These damages would come out of the home owner’s pocket.

If a homeowner in New Orleans wanted to rent their home for less than a year, (but longer than the short-term ban), they can purchase a 3 month commercial policy to cover any damages that may occur during that time.  However, there are specific conditions that must be met in order to qualify for  a commercial policy such as written lease agreements signed by the owner and all occupants, processes established for re-keying locks, lighted emergency exit signs and smoke detectors in all guest rooms.

 

Long story short about short-term rentals

 

Long story short, short-term rentals of less than 30 days are not legal in New Orleans and rentals of less than 60 days are not legal in the French Quarter. While this year homeowners can’t make an extra buck on renting out their home during Mardi Gras, there is always a chance the ban may be lifted for next year.

If homeowners are planning to legally rent out their home for a time period that is less than the typical year long lease, there are ways to cover your property legally with the right insurance. To learn more about rental property insurance, give us a call and we can find the coverage that is right for you. (844-271-8508)