As a landlord, you may think owning property and signing lease agreements are the only steps required to rent out your property, but that’s not always the case. Many landlords need specific permits and certifications to legally operate rental properties, depending on local laws and the type of rental.
In this guide, we’ll explore the top permits and certifications landlords need to rent properties, maintain compliance, and avoid legal issues.
Why Permits and Certifications are Important for Landlords
Permits and certifications ensure that rental properties meet local safety standards, follow zoning laws, and comply with housing regulations. These requirements are in place to protect both landlords and tenants, ensuring properties are safe, habitable, and legally registered with the local authorities.
Failure to obtain the proper permits and certifications can result in fines, legal disputes, and even eviction of tenants.
1. Rental Property Registration
In many cities, landlords are required to register their rental properties with the local government. This registration is often a straightforward process that involves providing basic details about the property and paying a registration fee.
Why It’s Required:
Rental property registration allows local governments to keep track of rental units for housing oversight and ensures that landlords comply with basic housing standards.
Example Cities:
- Chicago, IL: Landlords must register rental properties with the Chicago Department of Buildings.
- Los Angeles, CA: The Rent Stabilization Ordinance requires landlords to register rental units annually.
2. Occupancy Permit
An occupancy permit (also known as a certificate of occupancy) verifies that a rental property meets local building codes and is safe for tenants to live in. This permit is typically required when a new property is built, significantly remodeled, or converted into rental housing.
Why It’s Required:
The occupancy permit ensures that the property complies with safety standards, such as electrical systems, plumbing, and structural integrity, before tenants move in.
Example Cities:
- New York City, NY: Landlords must obtain a Certificate of Occupancy before leasing a building to tenants.
- Boston, MA: A Certificate of Occupancy is required to rent any residential unit, including multi-family housing.
3. Health and Safety Inspection
Many local governments require landlords to pass health and safety inspections to ensure the property is in good living condition. These inspections typically check for issues such as fire safety, mold, and pest infestations.
Why It’s Required:
Health and safety inspections ensure that rental units meet minimum habitability standards and protect tenants from unsafe living conditions.
Example Cities:
- San Francisco, CA: The Department of Building Inspection requires landlords to pass regular safety inspections.
- Seattle, WA: The Rental Registration and Inspection Ordinance (RRIO) mandates health and safety inspections every 10 years.
4. Zoning Permits
Zoning laws regulate how land can be used within a city, and some areas may require landlords to obtain a zoning permit to operate rental properties. This is particularly important for landlords managing short-term rentals or multi-unit buildings.
Why It’s Required:
Zoning permits ensure that rental properties are being used according to local land use regulations. Violating zoning laws can result in fines or forced eviction of tenants.
Example Cities:
- Portland, OR: Landlords must adhere to local zoning laws for residential and commercial rental properties.
- Denver, CO: Landlords need a zoning permit to operate short-term rentals like Airbnb.
5. Lead Paint Certification
If you own a property built before 1978, you are required by federal law to disclose the presence of lead-based paint to tenants and obtain lead paint certification. In some states, landlords may also need to complete lead hazard control certifications if the property houses children or at-risk populations.
Why It’s Required:
Lead paint poses serious health risks, particularly to young children. Certification ensures that landlords are aware of these risks and have taken steps to mitigate exposure.
Example States:
- Maryland: Landlords must register all pre-1978 rental properties and obtain lead paint risk reduction certification.
- Massachusetts: Rental properties must comply with lead safety laws if they house children under six years old.
6. Short-Term Rental Permits
If you’re renting out your property on platforms like Airbnb or VRBO, you may need to obtain a short-term rental permit. These permits are typically issued by the city and are often accompanied by strict regulations, such as limits on rental nights and occupancy taxes.
Why It’s Required:
Short-term rental permits help cities regulate the growing vacation rental industry and ensure that landlords are following local rules on occupancy, zoning, and taxes. Having the correct permits in place is essential for claiming tax deductions. Learn more about rental income tax obligations for landlords.
Example Cities:
- San Francisco, CA: Hosts are required to register and obtain a short-term rental permit.
- Austin, TX: Landlords must obtain a Short-Term Rental (STR) License to rent out properties for less than 30 days.
7. Rental License for Multi-Family Units
If you own and manage a multi-family rental property, such as an apartment building or duplex, you may need a specific rental license. Some cities require landlords to obtain this license before renting out units, particularly in rent-controlled areas or neighborhoods with strict housing laws.
Why It’s Required:
A rental license helps cities monitor the safety and legality of multi-family housing, ensuring that landlords provide habitable units that comply with local housing laws.
Example Cities:
- Minneapolis, MN: Landlords must have a rental dwelling license for properties with more than two rental units.
- Philadelphia, PA: A rental license is required for landlords renting out multi-family units or more than three properties.
How to Stay Compliant as a Landlord
Ensuring that you have the correct permits and certifications is crucial to operating legally as a landlord. To stay compliant:
- Check Local Laws: Always research the specific permits required by your city or county. Local government websites usually provide detailed information for landlords.
- Renew Permits Annually: Many permits, such as rental licenses, must be renewed annually or biannually. Set reminders to stay on top of renewal deadlines.
- Consult Legal Experts: If you’re unsure about which permits you need, consider consulting a real estate attorney or property management expert who can guide you through local regulations.
Conclusion
As a landlord, securing the right permits and certifications is essential for operating legally and protecting your investment. From rental property registration to occupancy permits and lead paint certifications, landlords must meet local and federal requirements to ensure their properties are safe and compliant with the law.
Before renting out any property, make sure you understand your local regulations and consult with a legal professional if necessary to avoid fines and legal issues. For more details on whether you need a business license to rent property, read our guide.
