Is Airbnb legal in Lexington-Fayette?

Lexington-Fayette, Kentucky, has established comprehensive regulations for short-term rentals (STRs), including platforms like Airbnb and VRBO, to address community concerns regarding housing availability and neighborhood integrity. Here’s a summary of the key regulations and requirements that prospective hosts should be aware of:

Regulatory Framework for Short-Term Rentals in Lexington-Fayette:

1. Licensing Requirements:

   • Operators must obtain a Zoning Compliance Permit from the Division of Planning.
   • A Special Fees License is also necessary, which costs $200 for the first rental unit and $100 for each additional unit. This license must be renewed annually.

2. Local Registration Number:

   • STR operators must display their local registration number on all advertisements across platforms like Airbnb and VRBO to ensure compliance and enhance accountability.

3. Maximum Occupancy:

   • In residential areas, the maximum number of guests allowed is limited to 12. For larger groups, hosts must apply for a Conditional Use Permit.

4. Safety Requirements:

   • Properties must comply with safety standards, including:
     • An emergency evacuation plan posted on-site.
     • At least one operable emergency and rescue opening in each sleeping room.
     • A fire extinguisher must be maintained in the unit.
     • Operators are required to provide emergency contact information.

5. Fees and Taxes:

   • Hosts are responsible for paying an annual fee ($200 for the first unit, $100 for additional units), which supports the management of STRs.
   • Those with a limited liability corporation earning over $50,000 annually are also liable for a 2.25% occupational tax.

6. Transient Room Tax:

   • STR hosts must pay an 8.5% transient room tax and are advised to connect with VisitLex for further compliance.

7. Zoning Compliance and Restrictions:

   • Properties must possess a Certificate of Occupancy proving they can legally operate as rentals. Hosts should also check for any restrictive covenants in their neighborhoods that may limit or prohibit rental activities.

8. Enforcement and Penalties:

   • The city has established penalties for non-compliance, which can reach $500 per day for operators lacking the necessary permits.
   • There is a six-month grace period implemented for existing operators to comply with the new regulations.

Community Perspectives:

The introduction of these regulations has generated diverse opinions among local hosts, with some expressing concern over increased costs and restrictions, while others acknowledge the necessity of regulations to mitigate the impacts of STRs on local housing markets and community standards.

In summary, prospective Airbnb hosts in Lexington-Fayette must navigate a well-defined regulatory landscape that includes licensing, safety, zoning compliance, and tax obligations, aiming to balance the interests of tourism with community welfare. Prospective hosts are encouraged to consult local authorities for the most current and detailed information.