Recently, questions have come up in the community about what happens if a property is inherited. To help clear things up, here’s a simple breakdown of the rules currently in place, based on the latest ordinance language.
Key Takeaways
- • Only heirs of the Feb. 7, 2023 owner of record qualify.
- • Inheritance can generate a new ISTR license even if the home never had one.
- • 90-day application window starts at the actual transfer of ownership.
- • Licenses can be renewed during probate if already in good standing.
1. Who Can Inherit an ISTR License
A property may qualify for an ISTR license if it was inherited after February 7, 2023 from the person who was the owner of record on February 7, 2023, and the inheritor applies for the license within 90 days of the transfer of ownership (or by May 1, 2025 for inheritances that occurred between February 7, 2023 and February 20, 2024). (§117.01)
👉 Importantly, this applies even if the property did not previously have a short-term rental license. Heirs of the Feb. 7, 2023 owner of record are eligible to apply for an ISTR license whether the property had an STR license in the past or not.
2. Proof You’ll Need
Proof of inheritance must be shown through:
- A deed of distribution
- A court order
- A will or similar legal document showing transfer of ownership to the applicant (§117.01).
3. Deadline to Apply
- Application for an ISTR for the rental of a dwelling unit inherited after February 7, 2023 must be made within 90 days of transfer of ownership.
- Exception: If the property was inherited between February 7, 2023 and February 20, 2024, the application may be made any time prior to May 1, 2025
4. One-Time Exception
The inheritance allowance applies only to property inherited from the owner of record on February 7, 2023.
5. Good Standing Still Applies
To remain valid, an ISTR license must remain in good standing, which requires:
- The license has not been denied, revoked, or suspended in the current license year.
- The license has not expired.
- The dwelling unit has been rented for a minimum of 28 nights in the current business license year
6. Bottom Line
Yes — an ISTR license may continue if the property was inherited after February 7, 2023 from the person named as owner of record on that date, and the heir applies within the timeframe using the required proof of inheritance.
No — ISTR licenses are otherwise non-transferable. The ordinance states:
- “Investment short term rental licenses terminate upon transfer of property and are non-transferable, except as provided for inheritance or medical hardship.”
If I inherit a house, do I lose the right to get a rental license if probate takes a long time?
No. The rule was written to account for the time it takes for estates to settle.
- The 90-day clock doesn’t start until you are officially the new owner. That usually happens once probate closes or the property is transferred into your name. You then have 90 days to apply for a license.
- Special grace period: If you inherited between Feb. 7, 2023 and Feb. 20, 2024, you can apply any time before May 1, 2025, even if probate dragged on.
Bottom line: You won’t be penalized because the estate process takes time — the ordinance gives heirs a fair window to apply once ownership is official.
