Vacation rental home market is hot in Palm Beach County

Vacation rental home market is hot in Palm Beach County

Peter Emmerich, left, and Rick Rose, right, who recently launched Palm Beach Vacation Rentals, pose for a portrait in front of one of their rental cottages on Aug. 21, 2015 in West Palm Beach. Rose and Emmerich run Grandview Gardens Bed and Breakfast but are expanding with their new business to market second homes as vacation rental properties. (Madeline Gray / The Palm Beach Post)


West Palm Beach is one of the fastest growing markets in the nation for vacation rental homes — a trend that industry leaders attribute, in part, to the growing popularity of online travel booking websites that specialize in the short-term rental of private houses, condominium units and apartments.

An analysis released last month by the travel website Hipmunk found vacation rental bookings in West Palm Beach skyrocketed by 852 percent from the summer of 2014 to the summer of 2015. Of the U.S. cities where Hipmunk offers bookings, West Palm Beach saw the largest growth, beating out other destinations including New York, Greenville, N.C., and Pittsburgh.

“The numbers are exciting, but not surprising to us,” said Jorge Pesquera, president and CEO for Discover The Palm Beaches, the official tourism marketing organization for Palm Beach County. “We’re having a record-breaking year for the tourism sector, as more and more people discover the Palm Beaches. Whether they choose one of our wonderful traditional hotels or resorts, or they prefer non-traditional options such as vacation rental homes, they are certain to find a high-quality option in the Palm Beaches.”

As more property owners look to market their second homes to tourists, West Palm Beach residents and business owners Rick Rose and Peter Emmerich have created a property management company specializing in vacation home rentals. Rose and Emmerich, who also own Grandview Gardens Bed and Breakfast and Vacation Homes Resort in West Palm Beach’s historic Grandview Heights neighborhood, launched Palm Beach Vacation Rentals this year, after several neighbors asked them for help renting out their homes.

“We kept having friends say, ‘We would love to have homes in Florida. Would you rent it for us?’ ” Rose said. “We realized that there were other issues that needed to be professionalized.”

The company helps ensure homeowners have the proper liability insurance and comply with all of local rules and restrictions, including a one-week minimum stay in West Palm Beach and a 6 percent tourism tax on all hotel stays and vacation rental bookings. The company also watches over guests, making sure they don’t disturb nearby residents.

“Palm Beach Vacation Rentals, as one example, is a trailblazing operation in the Palm Beaches that offers a unique accommodation option to our visitors,” Pesquera said. “With the rise in popularity of rental lodgings, this company is meeting the demand – and it’s exciting to see how quickly this market segment is growing.”

Demand has been so strong, Rose says they have been forced to turn away homeowners.

Currently, the company manages three of its own proprieties and seven privately-owned homes. Emmerich said they are in the process of taking on another two properties. All of the properties are in West Palm Beach.

Although the company is licensed to manage up to 75 properties, the business partners said they have been hesitant to take on too many properties too quickly. The company will only manage homes that are private-second residences, where owners are more likely to be vested in the property.

Tourism leaders don’t track vacation rentals in the county, but Palm Beach Vacation Rentals is one of only a handful of management companies that specialize in the short-term rental of private homes, industry leaders say.

PGA National, the northern Palm Beach County community known for its golf and resort pedigree, announced last year that it had launched its own vacation rental management firm. PGA National VacationRental Homes was designed to rent and service owners’ homes in PGA and surrounding communities, offering renters golf and resort privileges.

Vacation rentals have been growing in popularity as more travelers look for alternatives to traditional hotels. Larger homes can be appealing and offer savings for families, who might be forced to book multiple hotel rooms to accommodate everyone in their party. The home’s kitchen also allow families to save on food costs.

Meanwhile, the rise of online travel companies has made it easier for property owners rent their homes to out-of-towners. From the summer of 2014 to the summer of 2015, the share of overall vacation rental bookings on Hipmunk increased by 78 percent, the website said.

Nearly a quarter of leisure travelers say they have stayed in a vacation home rental in the last two years, while another 49 percent say are interested in staying in one, according to the national Vacation Rental Managers Association.

In Florida, the vacation rental business is a $30 billion industry. There are roughly 120,000 vacation rental properties across the state, Denis Hanks, executive director of The Florida Vacation Rental Managers Association.

But the rise in vacation rentals — and the websites used to book them — have also created problems for local officials.

Palm Beach County Tax Collector Anne Gannon filed suit this week against four online travel companies, alleging they have not been paying the county’s tourist development tax on vacation rentals they book.

Gannon alleges that the companies — Air BNB Inc., HomeAway Inc., TripAdvisor LLC and CouchSurfing International Inc. — failed to register as rental dealers and did not collect or remit the required taxes for short-term rentals they booked of private homes. The case is still pending.

The “bed tax” of 6 cents per dollar is levied on all hotel stays and vacation rentals of six months or less. The money it generates helps market the county as a tourist destination.

Gannon said her office is in the process of putting together a collections program that would attempt to prosecute homeowners who don’t pay the required taxes.

“The bed taxes are what pay for a lot of our cultural organizations, the baseball stadium, the sports commission,” Gannon said. “It is really important we get all of these. It is paid by people who come and visit.”

State rules prevent local governments from deciding how often and how long single family homes can be rented — something they were stripped of in 2010 due to the activism of vacationrental industry lobbyists.

West Palm Beach’s decades-old rule, which requires a one-week minimum stay, remained in place, however, since it took effect before the state law was enacted. But Rose fears there could be pressure to do away with the requirement as the industry grows.

Some residents have said the rule prevents a revolving door of occupants from degrading the quality of their neighborhoods. “It filters who stays there,” Rose said. “It is a different market segment.”

Source: Palm Beach Post
By: Jennifer Sorentrue – Palm Beach Post Staff Writer


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