Short Term Rental Use of Property Zoned Residential is Prohibited by a Zoning Ordinance Definition that Such Use is a Prohibited Transient Occupancy

Working Stiff Partners v. Portsmouth
New Hampshire Supreme Court Case No. 2018-0491
Friday, September 27, 2019

Working Stiff Partners, LLC (plaintiff) appealed a decision of the Portsmouth ZBA that prohibited the use of a single-family home for short-term rentals.   Plaintiff owns adjacent properties in Portsmouth’s General A Residence District; one property is an owner-occupied home, the other is a four-bedroom home that plaintiff had renovated and began renting through Airbnb.  Plaintiff’s Airbnb listing offered the four-bedroom home for daily rental, and for family parties, wedding parties and corporate stays.  City Code Enforcement Officials issued a cease and desist order that the home could not be used for short term rentals.  Both the Code Enforcement Officials and the Superior Court interpreted the Portsmouth Zoning Ordinance as prohibiting the use of the home for daily rentals as that constituted a transient occupancy that was expressly excluded as a permitted use in the General A Residence District. 

On appeal to the NH Supreme Court, plaintiff argued that it was an error to interpret the Portsmouth Zoning Ordinance as not permitting short-term rental of the property as a principal use.  After reviewing the relevant definitions in the zoning ordinance, the Court concluded that plaintiff’s use of the property for daily rentals to paying guests constitutes a transient occupancy like a hotel, motel, rooming house, or boarding house. Because the ordinance expressly excludes such transient occupancies from the definition of a dwelling unit the Court ruled that providing short-term rentals to paying guests on a daily basis, is not a permitted use affirming the decision of the Superior Court.  The Court also ruled that the definitions found in the Portsmouth Zoning Ordinance were not unconstitutionally vague and gave plaintiff fair notice that a short term rental use of the property was not permitted.  Left unresolved by the Court’s decision is whether a short-term rental use could be considered a permitted, accessory use of the property.

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Additional Information: 

Practice Pointer: It is possible to prohibit the use of residentially zoned property as a short-term rental use, provided the zoning ordinance clearly defines what are considered prohibited transient uses of residential dwelling units.