Objective:
This class will define the role of the real estate broker and agent in short-term vacation rentals in Massachusetts and will explore the federal, state, and local responsibilities owed to the consumer (owner, tenant, guest).
Instructor: It is the responsibility of the instructor to be sure all information is up to date and current.
1. Real Estate Licensing & Broker / Agent Roles
- Licensing requirements (education, exam, continuing education – now through eLIPSE portal as of 2025).
- Definitions of broker, salesperson, and their permitted activities.
- Non-licensed staff may perform only clerical or administrative tasks They must avoid activities that bring them into contact with clients and customers such as showing listings, giving information about listings and prices on the phone, writing leases, writing contracts, etc.
- 2025 Broker Fee Law:
- The fee can only be collected from the party with whom the broker or salesperson has a contractual agreement.
- A single agent cannot contract with both parties within the same transaction.
- Fee arrangements must be disclosed in writing.
2. Definition & Classification of Short-Term Rental
- Massachusetts definition: property not a hotel/motel/lodging house, rented for 31 consecutive days or less.
- Excludes tenancies at will and month-to-month leases over 31 days.
- 14-day exemption: if rented ≤ 14 days in a calendar year and declared, property is exempt from excise tax.
- Check municipal bylaws at the building and/or zoning departments—many cities/towns have their own STR definitions and restrictions.
3. Disclosure of Interest & Conflicts
- A broker or salesperson shall not buy, sell, rent, mortgage, or acquire any interest in, or represent a client in which they or their kin has a financial interest without first disclosing in writing to all parties and obtain written acknowledgment from all parties before proceeding.
4. Disclosures & Fees for Service
A. Agency Disclosure not required for rentals only fee disclosure.
- Agency Disclosure Forms not applicable for short term rentals in Massachusetts
B. Legal Basis for Charging Fees
- M.G.L. c. 112, § 87DDD½ – only licensed brokers/salespersons may charge a fee.
- 254 CMR 7.01 – written notice of fee required at first in-person meeting if tenant pays.
- Brokers and salespersons renting real property must provide prospective tenants with a written notice when charging a fee. The notice must include:
- The amount of the fee
- The manner and timing of payment
- Whether any portion is owed if a tenancy is not created
- Signed by the licensee and include their license number
- Keep on file for 3 years
- 2025 Broker Fee Law – fee may only be charged to hiring party; A single agent cannot contract with both parties within the same transaction.
- 2025 Junk Fees Law - All mandatory fees (cleaning, amenity, admin, booking) must be included in the advertised total price — the price a consumer first sees
5. Key Time / Term Thresholds & Statutory Impacts
| Term/Duration | Legal Impact |
|---|---|
| Tax | |
| < 31 days | Room Occupancy Tax applies |
| >31 days | Not subject to excise tax; standard landlord/tenant law applies |
| Security Deposits | |
| >30 days | Security Deposit statute (c.186 § 15B) applies for regular tenancies |
| < 100 days | STVR are not subject to the security deposit laws |
| Lead Paint | |
| < 31 days | Subject to Short-Term Vacation or recreational Rental Exemption Law |
| Short Term Vacation or Recreational Rental Exemption Form must be completed |
- Lead paint disclosure required for any rental of property built before 1978, regardless of term.
- Advertising & Marketing
Prohibited Practices / Required Content
- No false or misleading advertising – all information must be truthful and not deceptive.
- No blind ads – every advertisement must identify the advertiser as a broker.
All advertising must state that the advertiser is a Broker and not a private party. All advertisements must state Broker’s name and business address.
- Salespersons are not allowed to advertise on their own
- Digital & print listings must meet the same standard.
- Use of AI must be identified and compliant
- Confirm regulation (254 CMR 7.00) requiring the “apartment may no longer be available” disclaimer is current and apply to short-term rental ads.
Platform / Channel-Specific Rules
- Airbnb, Vrbo, Booking.com, etc.:
- Listings must include license/registration number if required locally (e.g., Boston ordinance).
- Ensure nightly rate shown includes taxes and mandatory fees
- Disclose cancellation/refund policies clearly.
- Confirm who collects/remits occupancy tax (platform vs. broker/owner).
- Social Media & Direct Ads:
- Same advertising rules apply — must identify brokerage and avoid misleading terms.
- Include broker identity and contact information on posts or digital flyers.
- Salespersons are not allowed to advertise on their own
Junk Fee Regulation (940 CMR 38.00 – Effective Sept 2, 2025)
- All mandatory fees (cleaning, amenity, admin, booking) must be included in the advertised total price — the price a consumer first sees.
- The total price must be more prominent than any individual line-item fees.
- The nature, purpose, and amount of each charge must be disclosed before collecting personal or billing information.
- If a fee is optional or avoidable, the advertisement must state how to avoid it.
- Applies to all advertising and rental offers, including listings on platforms like Airbnb/Vrbo and broker websites.
- Failure to comply may be treated as a deceptive practice under M.G.L. c. 93A and subject to Attorney General enforcement.
7. Room Occupancy Excise / Short-Term Rental Tax
- Room Occupancy Excise Tax M.G.L.830 Chapter 64G.1.1 as of December 2018
- Applicable to all rentals on properties for more than 14 days in any calendar year
- The total amount of rent is subject to tax as well as any and all operational charges such as insurance, linen fees, cleaning fees, booking fees, etc.
- Tax rate is 5.7% PLUS:
- a. Local option excise 0-6.5%
- b. Convention Center Finance 2.75% - Boston, Worcester, Cambridge, Springfield, West Springfield, Chicopee
- c. Cape Cod and Islands Water Protection Fund
- d. Community impact fee 0-3% (Owners of 2 or more units in one town)
- Applies to rent + nonrefundable charges (cleaning, linen, booking).
- Exemptions: refundable security deposits, rent < $15/day, ≤ 14-day declared rentals.
- Registration Requirement: All operators and intermediaries must register each property through MassTaxConnect, even if no tax is owed. Tax payments are only required for properties where tax liability exists.
- Tax Collection & Payment: Both operators and intermediaries are responsible for registration and tax compliance. If an intermediary collects the rent and tax, the intermediary—not the operator—must remit the tax.
- Must maintain $1M liability coverage per property.
- Real Estate Brokerages can provide mandated insurance
a. This means that licensees who provide services online, (or via phone
application or similar electronic processes) that allow short-term rental
operators to list their property and collect rent and allow a person to make a
reservation will be able to provide the operator the $1 million in liability
insurance required by statute.
b. Under the old regulations, only online service providers such as AirBnB,
Expedia, HomeAway, or VRBO could provide this insurance.
8. Fair Housing & Anti-Discrimination
- Federal and Massachusetts Fair Housing Laws apply to STVRs.
- Protected classes: race, color, religion, sex, sexual orientation, children, national origin, ancestry, marital status, veteran status, public assistance, age, handicap, gender identity.
- Accommodations must be made for handicapped individuals
9. Contracts for Short-Term Use
- Short term rental leases should be in writing and should address:
a. Names, full addresses, full legal address of the property, contact information, terms of lease, utilities, start date, and termination date, smoking policy, etc.
b. It must address security deposits, insurance, and the occupancy tax rate and all other fees.
- Short Term Vacation Rental Landlord Contracts should define all responsibilities of landlord and Broker and define all terms under which the property can be advertised and conform with the company’s lease. All landlords must supply a lead paint form fully executed yearly, calendars for availability, insurance information, rental tax rates, permission for photos, access to property, etc.
- Address service animals and ESAs per ADA/HUD/Mass. law.
10. Permitting, Local Regulation & Zoning
- Verify zoning, health, fire, building codes before renting.
- Many towns require registration, inspections, and permit number display in advertising.
- ADU, Condo/HOA rules may prohibit STRs.
11. Lead Paint & Environmental Safety
a. All properties built prior to 1978 are subject to the Lead Paint Law.
b. Lead Paint Short Term Vacation Rental Exemption must be signed and completed by owner prior to presentation to tenant. The tenant must receive exemption/disclosure form prior to signing lease.
c. Short Term Vacation or Recreational Rental Exemption Notification
a. Yearly inspection must be completed every 12 months
b. Check with local municipality for town regulations
- Lead Paint Disclosure and/or Exemption Form required for pre-1978 homes.
- Must comply with smoke/CO detector and fire safety requirements.
- Annual renewal or inspections may be required by local jurisdiction — confirm requirements with the town or city before advertising or renewing rentals.
12. Escrow / Trust Funds & Recordkeeping
- Short Term Vacation or Recreational Rentals under 100 days are not subject to the security deposit laws
- Keep detailed records for at least 3 years. The Division of Occupational Licensure has the authority to audit.
Suggested Handouts & Resources
- Lead Paint Disclosure & Exemption Form
- DOR Room Occupancy FAQ & Guide
- AG Advisory on 2025 Broker Fee Law
- AG Guidance on 940 CMR 38.00 (Junk Fees Regulation)
- Example municipal STR registration forms
- Room Occupancy frequently asked questions from mass.gov
| Last updated: | November 25, 2025 |
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