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New Permit Requirements for Residential Rental Property Owners

Sioux Falls has introduced a set of requirements for residential rental owners, effective January 1, 2024. These regulations apply to both long-term and short-term residential rental units, each carrying specific definitions and obligations for property owners.

Long-term rental units involve traditional housing arrangements where the property is leased for an extended period, serving as a place of residence for tenants. Short-term rental units, on the other hand, pertain to homes, cabins, or similar buildings rented on a daily or weekly basis for over 14 days in a calendar year. Notably, short-term units are distinctively not occupied by the owner or manager during the rental period, therefore excluding bed and breakfast establishments. Notably, exemptions are provided for on-campus housing, hospital units, nursing home units, and specific hotels or motels with daily rental units.

To obtain a permit under these new regulations, residential rental property owners are required to adhere to a detailed application process. This includes providing personal details such as name, mailing address, and phone number, along with specific property information like the street address and the number and type of units. For owners residing over 50 miles from Sioux Falls, a local contact within that radius is mandated for property upkeep approval. Additionally, information about the licensed individual managing the residential rental unit, if applicable, must be furnished.

Starting July 1, 2024, a $50 permit fee per address is imposed. The training requirements involve a minimum of two hours of approved course curriculum or proof of licensure through the South Dakota Real Estate Commission. Short-term rental permits have additional prerequisites, including proof of a state sales tax license and a health department lodging license.

The permit revocation process is transparent, triggered by a fourth health, nuisance, or other violation within three calendar years. Owners have an opportunity for compliance and can appeal revocation through established processes.

Property transfers of residential rental permits necessitate written notice within 30 days. No fees are attached to the transfer if compliance with this requirement is met.

Issuance of a permit does not waive or grant the right of continued operation for properties in violation of these regulations. Short-term rental units must provide guests with specific information, including emergency contacts, the property's physical address, and behavioral expectations, posted conspicuously within the unit.

In summary, these new requirements focus on establishing a responsible and compliant environment for residential rental owners, regardless of the duration of rental agreements, by outlining clear obligations and procedures for obtaining and maintaining permits.

If you have questions about this new permit requirement, give our office a call at (605) 275-5665.