Miami-Dade judge strikes down Miami Beach short-term rental ban

Natalie Nichols sued the city last year alleging short-term rental ordinance violated constitutional rights and Florida law against excessive fines

Oct.October 08, 2019 11:39 AM
Miami Beach Mayor Dan Gelber and Natalie Nichols home at 1531 Stillwater Drive (Credit: Getty Images)

Miami Beach Mayor Dan Gelber and Natalie Nichols home at 1531 Stillwater Drive (Credit: Getty Images)

In a major blow to Miami Beach’s crackdown on short-term rentals, Miami-Dade Circuit Court Judge Michael Hanzman granted summary judgment for Natalie Nichols, a real estate investor who sued the city last year over exorbitant fines approved by local elected officials.

Hanzman’s ruling invalidates Miami Beach’s short-term rental ordinances because the regulations conflict with state law that caps code violation fines between $1,000 to $5,000. Since 2016, the city’s fines for short-term rentals increased from $1,500 and $500 for single-family homes and multifamily buildings, respectively, to $20,000 for the first offense.

Matthew Miller, an attorney with the non-profit Goldwater Institute representing Nichols, said his client’s victory is a win for all Miami Beach property owners who want to rent out properties as on a short-term basis. “The judge not only struck down the fines, but also sections of the city’s ordinance that prohibit short-term rentals,” Miller said. “Because of this ruling, short-term rentals are now legal in Miami Beach.”

In a statement, Miami Beach Mayor Dan Gelber said the battle is far from over. “The City of Miami Beach intends to immediately seek appellate review of this decision — and [we] are confident that the Third District Court of Appeal will validate our ordinance,”Gelber said. “It’s no secret that rental rates in Miami Beach are astronomical, and our previous fines represented the cost of doing business and were a mere fraction of the charges for the illegal rentals.”

Gelber added that the hefty fines were necessary to maintain “the aesthetics, character and tranquility of our residential neighborhoods.”

Hanzman’s ruling comes on the heels of the city settling a separate federal lawsuit brought by Airbnb last year. In August, the vacation rental tech company dropped its litigation after both sides reached an agreement on how Airbnb would input business and resort tax information of hosts who listed Miami Beach properties on its platform.

In her lawsuit, Nichols alleged the city’s short-term rental fines are “excessive punishments” under the Florida Constitution. She owns a home at 1531 Stillwater Drive in Miami Beach’s Biscayne Point neighborhood that she used to rent on a short-term basis and had been fined $3,000 since 2010, when the city first enacted prohibitions against short-term rentals. According to the complaint, she stopped in 2016 when the city commission approved the huge increase in fines.

“At the height of the recession, when property values had dropped 75%, the city stripped us of our property rights, directly causing foreclosures and short sales,” Nichols said in a statement. “I am pleased that the court ruled to protect property rights today. This is a win for our community and visitors and should revitalize our great city.”

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