Getting into the rental property business and becoming a landlord is not as simple as putting a for rent sign on your front door. If you want to start properly, you need to go through the process of securing the proper documents to make sure that your rental is legal. If you don’t, you’re putting yourself and your business at risk of fines, penalties, and other liabilities.
That said, exactly how much is the fine for renting an illegal apartment in Texas? It can be a few hundred to a few thousand dollars (for short-term rentals, at least), depending on your town and the severity of the offense. Want to learn more on what exactly this entails? Read below!
Key Takeaways
- The fine for renting an illegal apartment in Texas can vary by town. In many towns, it is a few hundred to few thousand dollars for short-term rentals. As an example, fines in Austin for illegal short-term rentals can reach up to $1,000 per day, as well as 2k for criminal claims.
- Other than illegal apartment fines, fines for other violations, such as unsanitary conditions, can range from a few hundred dollars up to a thousand or more, and may also be subject to escalation for repeat offenses.
- An apartment is considered illegal in Texas if it has zoning violations, missing permits, or fails to meet safety and habitability standards. Legalizing a rental requires addressing violations, obtaining proper permits, and passing city inspections.
How Much Is the Fine for Renting an Illegal Apartment in Texas?
As a company that offers Austin property management solutions, we know that knowing how much is the fine for renting an illegal apartment in Texas can help you navigate tricky situations. To do so, it’s important to understand that fines and penalties depend on several factors, such as your location and the gravity of the offense. Being a repeat offender will also put you in a tighter position and lead to heftier fines and penalties.
Fines for operating an unlicensed short-term rental currently can be up to $1,000, as well as $2,000 per day for criminal claims, in Austin. Meanwhile, San Antonio charges $500 for them per day, and Houston’s fees now range from $100-$500. Of course, these price ranges are all subject to change, but the main point still stands. If you’re found renting an illegal apartment in other areas of Texas, you can likely expect fines ranging from a couple of hundred dollars up to several thousand, depending on the violation and location.
On top of that, there are also other risks and penalties. For example, a tenant can sue you and seek compensation if they find out that you’re renting an illegal apartment. In some cases, they may ask for refunds or rent deductions, both of which you don’t want as a landlord.
What is Considered an Illegal Apartment?
An unit is considered illegal if it’s being rented out as a rental, but it does not comply with the necessary state and local regulations. In Austin, for example, this includes zoning requirements, safety codes, and habitability conditions. To give you a better idea, here’s a review of the most common issues that can render an apartment illegal:
Licensing and Registration
While there is no state-wide licensing requirement in Texas, some localities have their own regulatory requirements. For example, in Austin, there is no licensing requirement for long-term rentals (those with lease terms lasting more than 30 consecutive days). However, Austin landlords need to get a license for short-term rentals and boarding houses.
So, in consideration, the legal requirements you need to meet depend on the type of rental property business. If you want to rent out your apartment as a short-term rental, you will need to obtain a permit. On the other hand, if you’re looking to rent it out with long-term lease contracts, there’s no required licensing for it.
Lack of Proper Permits
It’s fairly common practice in the rental property industry for homeowners to convert their extra space and rent it out as a passive means to generate rental income. However, many mistakenly do this without securing the proper building permit for any major structural changes or conversions. Similarly, you may need a Certificate of Occupancy before you can have tenants move in. Renting out an apartment without this can classify it as an illegal apartment.
Zoning Violations
A city’s zoning rules and regulations are designed to ensure that properties are used within its designated zoning classification. For example, residential zoning is intended for properties used for housing purposes and is illegal to use otherwise. The same idea goes if your property is zoned as a single-family real estate and you’re operating it as a multi-family rental. Violating zoning regulations can lead to hefty fines or, worse, the city may force your tenants to vacate until you comply.
Habitability Concerns
Rental properties must meet habitability standards, as required under the implied warranty of habitability and the Texas Property Code. Allowing tenants to continue living in an apartment with substandard or unsafe living conditions can be a serious violation, putting you at great risk and liability if a tenant gets hurt or injured.
Steps to Legalize an Illegal Apartment
Now that you know how much is the fine for renting an illegal apartment in Texas, you’d want to avoid them as much as possible. If you have concerns about the legality of your rental apartment, here’s what you need to do:
- Review official records to check if your property has any outstanding violations. If you’re given a notice of violation, go over the document and look for what is required that you do to address the issue at hand.
- For safety code concerns, make the necessary improvements with the help of qualified industry professionals for better quality work and compliance.
- For permit issues, submit the required documentation (architectural or construction plan, application form, etc.) to your city’s Development Services Department.
- Schedule inspections to let the city know and verify that you have addressed their concerns. Submit the paperwork showing proof of compliance to the city to settle the matter once and for all.
Avoid Penalties and Violations with BMG
In summary, the fine for renting an illegal apartment in Texas can vary, but in many towns, it ranges few hundred to few thousand dollars for short-term rentals. So, you should keep that in mind.
That said, knowing how much is the fine for renting an illegal apartment in Texas is good, but what you really want is to avoid them from the get-go. Working with property management companies like us might be exactly what you need to do that. We can take care of legal compliance, so you don’t have to. At Bay Property Management Group, we oversee over 6,000 rentals in Texas, Maryland, D.C., Pennsylvania, and more. Needless to say, we have the experience you need to stay compliant with federal and local regulations. Interested? Come visit our website and connect with us to know how our services fit your needs!