Thinking about turning a guest cottage on your property into steady income? In The Acreage, that can be a smart move when the unit is properly permitted and set up for long-term tenants. You want a clear path that covers the rules, the numbers, and the practical steps so you avoid costly mistakes. This guide walks you through what to check, how to budget, and how to move forward with confidence. Let’s dive in.
What counts as a permitted guest cottage
Accessory quarters, also called guest cottages or accessory dwelling units, are self-contained living spaces on the same lot as your primary home. They may be attached, detached, or converted from an existing structure. For long-term leasing, the key is that the unit was built or converted with permits and inspections.
Only permitted accessory quarters should be rented. Unpermitted units can lead to fines, forced corrections, or even removal. Start by confirming permits and whether the unit is approved for occupancy.
Check local rules first in The Acreage
The Acreage sits in unincorporated Palm Beach County, so county codes and permitting apply. Specific allowances can vary by zoning district and parcel. Plan to verify parcel details with Palm Beach County Planning, Zoning and Building, the Property Appraiser, and the Health Department before you market the unit.
Zoning and allowed use
Confirm your parcel’s zoning district and whether an accessory dwelling is permitted as of right or needs a special approval. Zoning dictates if detached units are allowed, maximum size, and where on the lot the unit can sit. Ask about whether a separate address or utility service is allowed for your setup.
Setbacks and lot coverage
Accessory structures must meet minimum setbacks from property lines and abide by lot coverage limits. Some rules change based on structure height or sleeping occupancy. Also review required separation from the main house and any easements that affect your buildable area.
Septic, wells, and utilities
Many homes in The Acreage rely on private wells and septic systems. The Health Department regulates septic capacity and setbacks from wells, property lines, and waterbodies, which can limit where a cottage can go or whether bedrooms can be added. Clarify if a septic expansion is required and whether separate electric or water meters are feasible.
Parking and access
Palm Beach County’s code typically requires off-street parking per dwelling unit or bedroom. Confirm how many spaces you need and whether gravel or paved surfacing is required on your street. If a new driveway or access is planned, ask the county about driveway permits.
Building code and occupancy
A permitted unit must meet Florida Building Code standards for habitability, including egress, smoke and carbon monoxide detectors, and fire separation when attached. Make sure you have a Certificate of Occupancy or the county’s equivalent before placing a tenant. If you are converting space, plan for building, electrical, plumbing, and mechanical permits.
Flood, wetlands, and site limits
Use FEMA flood maps to check whether your lot sits in a flood zone, which can trigger elevation requirements and affect insurance. Larger parcels may include wetlands or drainage areas regulated by the South Florida Water Management District. These constraints can shape your site plan and costs.
Covenants and local associations
Some areas within The Acreage have private covenants or association rules. Review deed restrictions for rental limits, minimum lease terms, or registration requirements before you proceed.
Long-term rental basics in Florida
Long-term leases are treated differently from short-term or transient rentals. Tourist taxes and special registrations often apply to short stays, while long-term rentals generally focus on building, health, and safety compliance.
Florida’s landlord-tenant law, Chapter 83, governs deposits, notices, and lease obligations. Plan to follow these requirements and keep clean records. Also talk to your insurer about landlord coverage and flood or wind protection, which can differ from a standard homeowner policy.
Estimate rent and returns
A clear financial picture helps you set realistic goals and avoid surprises.
Find market rent
Start with comparable long-term rentals in The Acreage and nearby rural Palm Beach County. Look for similar unit type, square footage, bedroom count, privacy, parking, and whether utilities are included. Consider seasonal patterns, but note that long-term rents are generally more stable than short-term rates.
Decide if your rent will include utilities. Including utilities can attract tenants and simplify billing if you do not have separate meters, but it changes your expense profile.
Budget operating costs
Build a budget that includes:
- Mortgage or financing costs
- Property taxes and insurance, allocated to the cottage’s share
- Utilities you pay, plus septic service and trash
- Routine maintenance, landscaping, and pest control
- Capital reserves for roof, HVAC, and septic needs
- Property management fees if you hire a manager
- Vacancy allowance and tenant placement costs
- Permitting or compliance costs spread over time
Key formulas and an example
Use these simple steps to model performance:
- Gross Annual Rent (GAR) = monthly rent × 12
- Effective Gross Income (EGI) = GAR × (1 − vacancy rate) + other income
- Operating Expenses (OE) = sum of annual recurring costs
- Net Operating Income (NOI) = EGI − OE
- Cash Flow Before Tax = NOI − annual debt service
- Implied Value from NOI = NOI ÷ market cap rate
Illustrative example only, not local data: If rent is 1,500 per month, GAR is 18,000. With a 7 percent vacancy, EGI is 16,740. If annual expenses total 6,774, then NOI is 9,966. If similar rentals trade at a 6 percent cap rate, the implied value from that income is about 166,100. Use local comps and your actual costs to replace these numbers.
Cap rate and exit value
Cap rates vary by location, property type, and interest rates. To estimate an exit value, gather recent rental property sales in Palm Beach County, derive their cap rates using known or advertised income, and compare. If data is thin, speak with local investors or property managers to sanity-check your assumptions.
Step-by-step checklist
Use this quick roadmap to move from idea to income:
- Confirm parcel and zoning.
- Verify zoning, permitted accessory uses, and setbacks with Palm Beach County.
- Pull your survey or plat map to identify buildable areas and easements.
- Confirm building status.
- Check permits and whether the unit has a Certificate of Occupancy.
- If unpermitted, discuss options to legalize with county staff.
- Verify septic and well details.
- Confirm approved bedroom count and septic capacity with the Health Department.
- Review required setbacks between septic, wells, and property lines.
- Review environmental constraints.
- Check FEMA flood zone and any local elevation needs.
- Confirm wetlands or drainage restrictions and any required buffers.
- Plan utilities and parking.
- Decide on utility billing and whether separate meters are allowed.
- Confirm required off-street parking and surface type.
- Pull permits and schedule inspections.
- Apply for building, electrical, plumbing, and mechanical permits if needed.
- Obtain the CO or equivalent before marketing the unit.
- Line up insurance and registrations.
- Update your insurance for landlord coverage and flood if applicable.
- Confirm any local business tax receipt or licensing requirements.
- Prepare for leasing.
- Draft a lease consistent with Florida law and set clear house rules.
- Arrange tenant screening and decide whether to hire a manager.
- Set up accounting and records.
- Track permits, inspections, utilities, repairs, and tenant communications.
- Keep documentation for tax reporting and compliance.
Common pitfalls to avoid
- Renting an unpermitted unit. Always verify permits and occupancy approvals before marketing the space.
- Underestimating septic limits. Adding bedrooms without confirming capacity can trigger costly upgrades or denials.
- Ignoring parking rules. Missing a required off-street space can delay approvals and upset neighbors.
- Forgetting flood risk. Flood zones affect construction costs and insurance; budget accordingly.
- Skipping landlord insurance. Standard homeowner policies may not cover tenant-related claims.
When to bring in local pros
If you are unsure about zoning, septic capacity, or code compliance, contact Palm Beach County Planning, Zoning and Building and the Health Department for guidance. An experienced local property manager or rental investor can help with rent comps and operating assumptions. For leases and legal questions, consult a local real estate or land-use attorney. A CPA can help you set up depreciation and tax reporting for rental income.
Ready to assess your options?
If you are deciding whether to buy, sell, or keep a property in The Acreage with a potential rental cottage, you deserve clear, local guidance. The Ahee Group can help you evaluate how a permitted accessory unit may influence marketability, buyer demand, and long-term value as part of a wider move or sale. Reach out to schedule a conversation and Request a Concierge Consultation.
FAQs
Can I rent a detached guest cottage in The Acreage long term?
- Possibly. If your parcel’s zoning allows accessory dwellings and the unit meets building code, septic and well requirements, and has proper permits and occupancy approval, you can pursue a long-term lease.
Do I need a separate address or meter for a cottage rental?
- It depends. Some setups allow separate electric or water meters, while others share service. Check county rules and utility provider policies before you plan billing and leases.
Are there size or occupancy limits for accessory units?
- Yes, limits can apply. Zoning, building code, and health department rules may restrict floor area, bedroom count, and occupancy per bedroom. Confirm specifics for your parcel.
Are long-term rentals treated like short-term rentals in Palm Beach County?
- No. Short-term or transient rentals often have tourist tax and special registration requirements. Long-term leases typically focus on building, health, and safety compliance, but confirm definitions and rules with the county.
What insurance do I need when renting a guest cottage?
- Notify your insurer and secure landlord or rental property coverage. Review wind and flood protections and deductibles to align with local risks.
How do I estimate what my cottage is worth as an income asset?
- Calculate your NOI from realistic rent and expenses, then apply a market cap rate derived from comparable rental property sales in Palm Beach County to estimate an implied value.