Is Airbnb legal in Chattanooga?

Chattanooga Short-Term Rental Regulations Overview

Chattanooga, Tennessee, has established comprehensive regulations to govern short-term vacation rentals (STVRs) such as Airbnb and VRBO. Designed to protect the city’s long-term housing supply and adhere to zoning codes, these regulations were finalized after extensive consultation over 13 months and 27 drafts.

Key Regulations:

1. Zoning and Designation:

   • Homestays (owner-occupied): Allowed in all commercial zones and residential zones within the short-term vacation rental overlay. This designation requires the owner to reside at the property for at least 183 days a year.
   • Absentee Rentals (non-owner-occupied): Permitted only in specific commercial zones (C-2, C-3, C-4, UGC, etc.) and on parcels of at least 20 acres that allow residential use.

2. Licensing Requirements:

   • Licenses: All STVR operators must obtain a license, which must be renewed annually.
   • Fees:
     • Homestay: $250 for application and renewal.
     • Absentee: $500 for application and renewal.

3. Enforcement Measures:

   • The city has introduced stricter enforcement of the regulations, including administrative hearings for violations that can result in fines up to $500 per day.

4. Occupancy Taxes:

   • Owners must register to collect and remit both Tennessee sales tax and local occupancy taxes. Reports and payments are due monthly.

5. Cooling-Off Period:

   • A property undergoing rezoning cannot apply for an absentee STVR permit for 18 months post-rezoning. Additionally, a cooling-off period is in place to prevent circumvention of regulations.

6. Community Engagement:

   • The regulations were developed with input from neighborhood groups and business owners, aiming to balance the needs of the community and the rental market.

7. Required Documentation:

   • Typical documents necessary for application may include proof of property ownership, floor plans, local contact details, and proof of insurance.

8. Public Feedback:

   • Hosts express a mixed response; while some appreciate the clarity and compliance ease, others feel the restrictions limit available rental opportunities, particularly in residential neighborhoods.

Chattanooga's efforts demonstrate a commitment to maintaining a balance between supporting short-term rentals and protecting the integrity of its neighborhoods. For further details or inquiries, hosts and potential applicants can contact the Land Development Office or visit the official city website.