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What is the Vacation Rental Act? · From Check In to Check Out

• Grayson: One of the most important things is you need to make sure if you own a property and it's currently with a management company, that your realtor Thad: One of the most important things is you need to make sure if you own a property and it's currently with the management company that your realtor checks yes on the MLS that it is subject to the Vacation Rental Act. Yeah, it's one of the disclosures, right? One of the disclosures is also an addendum that needs to be signed. This is so if someone purchased your property, there's no surprises that they didn't know it was on a management company, they didn't know they had anything to honor. Grayson: checks yes on the MLS that it is subject to the Vacation Rental Act. One of the disclosures. There's one the disclosures, there's also an addendum that needs to be signed. This is so if someone purchased your property, there's no surprises that they didn't know it was on a management company. They didn't know they had anything to honor. Thad: Hello, everybody, and welcome back to From Check In to Check Out, the podcast brought to you by Elliott Beach Rentals I'm Thad. I'm here with Grayson, one of our seasoned vets of the new business department. Today we are going to take a few minutes to talk about the South Carolina Vacation Rental Act. A very important act, particular to South Carolina, where you need to understand, especially in the transfer of a property, what that means. Now Grayson, Grayson has a lot more experience with this, so I'm going to pass this question off to him. Now, Grayson. Grayson: Hello everybody and welcome back to From Check In to Check Out, the podcast brought to you by Elliott Beach Reynolds. I'm Thad, I'm here with Grayson, one of our seasoned vets of the new business department. Today we're going to take a few minutes to talk about the South Carolina Vacation Rental Act. A very important act, particular to South Carolina, where you need to understand, especially in the transfer of a property, what that means. Now Grayson. Grayson has a lot more experience with this, so I'm going to pass this question off to him now. Grayson. Thad: Well can you tell us about the meat of the South Carolina Vacation Rental Act and particularly how it applies to a transfer of a sale? So Grayson: What can you tell us about the meat of the South Carolina Vacation Rental Act and particularly how it applies to a transfer of sale? So the South Carolina Vacation Rental Act is in place to protect the guest Thad: the South Carolina Vacation Rental Act is in place to protect the guests. Grayson: that are currently having vacation rentals through a management company. So this Thad: So this Grayson: takes into consideration the buyer, the seller, and the realtor. One of the most important things is you need to make sure if you own a property and it's currently with a management company, that your realtor Thad: Into consideration the buyer, the seller, and the realtor. One of the most important things is you need to make sure if you own a property and it's currently with the management company that your realtor checks yes on the MLS that it is subject to the Vacation Rental Act. Yeah, it's one of the disclosures, right? One of the disclosures is also an addendum that needs to be signed. This is so if someone purchased your property, there's no surprises that they didn't know it was on a management company, they didn't know they had anything to honor. So the South Carolina Vacation Rental Act states. Grayson: checks yes on the MLS that it is subject to the Vacation Rental Act. One of the disclosures. There's one the disclosures, there's also an addendum that needs to be signed. This is so if someone purchased your property, there's no surprises that they didn't know it was on a management company. They didn't know they had anything to honor. So the South Carolina Vacation Rental Act states Thad: That at the closing of a property, the new buyer must honor 90 days of bookings. So if you have a property and someone else purchases it, they can't move in Grayson: that at the closing of a property, the new buyer must honor ninety days of bookings. So if you have a property and someone else purchases it, they can't move in Thad: automatically. They're gonna have to honor 90 days of rentals. So that's very important because if someone's not aware of that and they buy your property and they have no idea they have to honor, that's gonna be a big deal, especially if they're wanting to move in as their primary residence and they're not wanting to continue renting the property. So that is in place, like I said, to Grayson: automatically. They're gonna have to honor ninety days of rentals. So that's very important because if someone's not aware of that and they buy your property and they have no idea they have to honor, that's gonna be a big deal. Especially if they're wanting to move in as their primary residence and they're not wanting to continue renting the property. So that is in place, like I said, to Thad: protect Grayson: protect the guests because many of these guests have made these reservations way in advance and we want to be able to make sure that their stay is protected. Yeah, Thad: the guests because many of these guests have made these reservations way in advance and we want to be able to make sure that their stay is protected. Yeah I think that's a very important point is that it's solely there Grayson: I think that's a very important point is that it's solely Thad: it to protect the guests, right? Grayson: place. Thad: But one other thing Grayson: But one other thing. Thad: that I think is also worth noting is let's talk about let's just say you are you did purchase a property and you are honoring everything after closing, you have to honor 90 days. Tell us about how that revenue goes to who who does that revenue go to? Grayson: Let's talk about. Let's just say you did the property, you are honoring everything after closing, you have to 90 days. Tell us about how that revenue goes to who does revenue go Thad: So when you're honoring, what it does is with with us here, you transfer that property over to the new Grayson: to? So when you're honoring, what it does is with us here, you transfer that property over to the new owner. So if they say, Hey, they're buying the property, they're moving in, they just need to honor the 90 days in place. We just get the information we need to ensure at closing. Thad: So if they say, hey, they're buying the property, they're moving in, they just need to honor the 90 days in place. We just get the information we need to ensure at closing that money gets transferred over to them and not the previous owner. So we just need a little bit of paperwork that shows your only honoring. We get your direct deposit information, we get the W9, which shows that you are the owner, and then all the money will then transfer over to you during that Grayson: That money gets transferred over to them and not the previous owner. So we just need a little bit of paperwork that shows your only honoring. We get your direct deposit information, we get the W9, which shows that you are the owner, and then all the money will then transfer over to you during that. Thad: honor period. Okay, that's good to know. So that the the buyer is actually reaping the benefits of those ninety days after they've purchased, after they've closed. That money will go to them. Grayson: After they've purchased that. Yes, that money will go to them. Okay, Thad: do they have to stay with the company that they're honoring with? Grayson: do they have to stay with the company honoring with? No. So that's a decision they make. They can either keep it with the current management company, they can take it off altogether. Like I said, if they're gonna move in and don't want to rent. Now one thing we see a lot of times is this doesn't really go into the Vacation Rental Act. This is more or less if you're transferring from one company to another. So this is another scenario we like to explain. Thad: So that's a decision they make. They can either keep it with the current management company, they can take it off altogether. Like I said, if they're going to move in and don't want to rent. Now, one thing we see a lot of times is this doesn't really go into the Vacation Rental Act. This is more or less if you're transferring from one company to another. So this is another scenario we like to explain. So if you terminate with a current property management company, usually they have an honor period saying how long you have to honor with them. A lot of people think, well, I have to honor with them for let's say three months. Grayson: So if you terminate with a current property management company, usually they have an honor period saying how long you have to honor with them. A lot of people think, well, I have to honor with them for let's say three months and then I have to start all over with another company. That's not the case. We like to explain with people that if you terminate with one company and you have to honor a certain amount of time, we can go ahead and get in and take pictures and have you live on our website during that same time period. So what we do is we block our calendar off. Thad: Then I have to start all over with another company. That's not the case. We like to explain with people that if you terminate with one company and you have to honor a certain amount of time, we can go ahead and get in and take pictures and have you live on our website during that same time period. So what we do is we block our calendar off until you're done terminating with that previous company, but we're able to go ahead and take bookings after that date. So you're not losing any time. You're live on our website, and while you're honoring, you're still able to take bookings with us at Elliott That's great. So you're able to Grayson: until you're done terminating with that previous company, but we're able to go ahead and take bookings after that date. So you're not losing any time. You're live on our website. And while you're honoring, you're still able to take bookings with us at Elliott. That's great. So you're able to get Thad: get everything, your ducks in a row, your pictures done, everything that you can up until the point of their termination date. So when it's day one with you, they're already up and running. Yep, and hopefully they'd already have bookings after that date. And a lot of a a lot of homeowners don't know they can do that. Grayson: everything, your ducks in a row, your pictures done, everything that you can up until the point of their termination date. So when it's day one with you, they're already up and hopefully they'd already have bookings after that date. And a lot of a a lot of homeowners don't know they can do that. They think, well, I have to honor until this date and I can't get started with another company until this date. Technically you don't get started with rentals, but you can already have your pictures up. You can already have the ball rolling and be getting those reservations while you're honoring with the other company. Exactly. You do. So we would just block that calendar out, and then once that termination period's over, that's when it allows us to start taking booking. So if you had to terminate in September and honor until December thirty one, that gives us Thad: They think, well, I have to honor until this date, and I can't get started with another company until this day. Technically, you don't get started with rentals, but you can already have your pictures up, you can already have the ball rolling and be getting those reservations while you're honoring with those. Yeah, theoretically, you can have 90 days of marketing already up and running. Exactly. You do. So we would just block that calendar out, and then once that termination period's over, that's when it allows us to start taking booking. So if you had to terminate in September and honor until December 31, that gives us the chance. Grayson: the chance Thad: Chance to be able to start December 31, we are already getting bookings for next year for you. So you're not losing any time. And that's the biggest thing is people think, well, I'm going to lose out because I'm having honor and I'm not getting marketed. You can't, you can do both. You can have the best of both worlds. Grayson: to be able to start December thirty one, we are already getting bookings for next year for you. So you're not losing any time. And that's the biggest thing is people think, well, I'm gonna lose out 'cause I'm having honor and I'm not getting marketed. You can't you can do both. You can have the best of both worlds. Thad: That's great. One other thing I would like to bring up is that I've had to deal with this very recently: is that in a listing agent and Grayson: I've had to deal with this very recently is that when I'm in a listing agent Thad: a buyer's agent, they were going back and forth. The buyer's agent actually requested to the listing agent: hey, just block the calendar out. Like this is like the offer. Grayson: Agent actually requested to the listing agent hey, just block the calendar out. Like this is like the offer Thad: forgot Grayson: got accepted. We don't want any. Thad: accepted. We don't want any have to honor any more rentals than we have to. And it was really interesting because I was like, if I'm the listing Grayson: Really interesting because that was like fatalistic. Thad: agent, I'm not blocking out my calendar, right? You don't know if if you're gonna close. Like you you you hope so, but you have no idea what's gonna happen between getting that offer accepted and getting closed. So to all the listing agents out there, I would really think hard Grayson: right you don't know if if you're gonna close. Like you you you hope so, but you have no idea what's gonna happen between getting that offer accepted and getting close. So to all the listing agents out there, I would really think hard Thad: about whether or not you want to start encouraging your owner to block off the ability to rent because let's just say you do block off those 90 days. Grayson: your owner to block off the ability to rent because let's just say you do block off those ninety days. You go through your 30 or your 45 day close and when you get to the table, the deal falls through. Now you've lost the ability to generate revenue for those ninety days because you blocked it off in you know trying to work with the buyer that eventually didn't buy it. Thad: You go through your thirty or your forty five day close and when you get to the table, the deal falls through. Now you've lost the ability to generate revenue for those ninety days because you blocked it off in, you know, trying to work with the buyer that eventually didn't buy. Grayson: And in regards to that too, you don't want to block it off because if you have to honor ninety days anyway, say you don't have or say you only have several reservations and they're spaced out. Thad: And in regards to that too, you don't want to block it off because if you have to honor ninety days anyway, say you don't have say you only have several reservations and they're spaced out, why would you not want to continue trying to make more money, even if you're gonna just honor three months? I want to try to maximize those three months. I don't want to have blocks. If I have to honor until December thirty one and today's, you know, September ninth or tenth, I mean, I want to try to maximize those three months to have Elliott still trying to get people in, still making me money while I'm honoring. I don't Grayson: Why would you not want to continue trying to make more money, even if you're gonna just honor three months? I want to try to maximize those three months. I don't wanna have blocks. If I have to honor until December thirty one and today's, you know, September ninth or tenth, I mean, I want to try to maximize those three months to have Elliott still trying to get people in, still making me money while I'm honoring. I don't understand why you would want to block it off. You're leaving money on the table. Yeah, I'm the same. Thad: Understand why you would want to block it off. No. You're leaving money on the table. Yeah, I'm the same way. I'd be like if if I have to honor to this date might as well make, some money off and make it worth it. But yeah. Is there anything else you'd like to add on a final note with the South Carolina vacation Act? We we we tackled quite a right there. Yeah, I think it's just very important to make sure that both sides understand the seller and the buyer, make sure your real estate agent knows that everything's where it needs to be in the MLS. Because you don't want any surprises. I've ran into a couple before where it wasn't listed in the MLS and the new buyer. Grayson: there anything else you'd like to add on a final note with the South Carolina right? We we tackled there. Yeah, I think it's just very important to make sure that both sides understand the seller and the buyer, make sure your real estate agent knows that everything's where it needs to be in the MLS. 'Cause you don't want any surprises. I've ran into a couple before where it wasn't listed in the MLS and the new buyer's like, Whoa, I had no idea I had to honor. I was ready to move in the day after it closed. And you say, Unfortunately you can't. So I'm Thad: And you say, Unfortunately you can't. Yeah, realtor dropped the ball there. Yeah, I mean it's it is very, very important because that can be that can blow up a deal. Yeah. Because if I was if I was buying a property and I knew I wanted to move in right after closing, and then, you know, really close to my closing date, the rental company calls me and says, Whoa, you can't do that. Yeah, imagine you just sold your house and you're thinking about moving in to write a right a close. That'd be brutal. Grayson: Yeah, I mean it's it is very, very important because that can be that can blow up a deal. 'Cause if I wa if I was buying a property and I knew I wanted to move in right after closing and then, you know, really close to my closing date, the rental company calls me and says, Whoa, you can't do that. Yeah, imagine you just sold your house and you're thinking about moving it and right at right at close. Yeah, it can be it can be a big problem. Thad: everybody needs to understand how important the South Carolina Vacation Rental Act is. Grayson: everybody needs to understand how important the South Carolina Vacation Rental Act is. Thad: Yeah. so yeah, it's super, super important. Yeah. Grayson: so yeah, it's super, super important. Thad: All right buddy, well I think we we crushed it there. Well, I appreciate your time and we'll see you next week. All right. Grayson: All right, well I think we we crushed it there. Well, I appreciate your time and we'll see you next week. All right.