Nashville Short-Term Rental Regulations

## Nashville Short-Term Rental Compliance Guide Nashville, Tennessee requires **mandatory registration** for all short-term rental properties through the Metro Codes Department. This comprehensive guide outlines the requirements, restrictions, and obligations for operating legally in Nashville's competitive STR market. ### Quick Stats | Metric | Details | |--------|---------| | **Permit Type** | STRP Permit (Metro Codes Department) | | **Permit Fee** | **$313.00** (one-time, non-refundable) | | **Renewal Period** | Annual (365 days) | | **Occupancy Tax** | **6%** local + 7% state + 2.25% local sales tax | | **Combined Tax Rate** | Approximately **15.25%** | | **Insurance Requirement** | Minimum **$1+ million** liability | | **Max Stay Length** | Less than **30 consecutive days** per booking | | **Occupancy Limit** | 2 adults per bedroom + 2 additional guests | | **Max Fine** | **$50/day** (first violation); **$500/day** (repeat violations) | --- ## 1. Registration & Licensing ### Overview All short-term rentals in Nashville require an STRP (Short-Term Rental Property) Permit from the Metro Codes Department before listing on any platform. **Operating before receiving your permit is a violation that triggers a 1-year prohibition on future permits.** ### Permit Types **Owner-Occupied Permits:** - Available for properties where the owner resides - Allowed in single-family and two-family residential zoning - Limited to one permit per lot in these zones - May be permitted on larger properties or multi-family zoning with multiple units - Requires proof of owner-occupation **Non-Owner-Occupied Permits:** - Restricted to specific zoning districts only - **NOT permitted** in AR2A, R, RS, or RM zoned areas - Limited availability due to zoning restrictions - Requires proof of property ownership or management authorization ### Registration Process **Step 1: Gather Required Documentation** For **Owner-Occupied Permits**, collect four documents proving owner-occupation: - **Group A (choose 2):** Driver's license, voter registration, property deed, or other primary identification - **Group B (choose 2):** Current property tax bill, mortgage statement, utility bill, insurance policy, or similar documentation Each document must show the owner's name and address matching the property. For **Non-Owner-Occupied Permits:** - Proof of property ownership (deed, title) - Management authorization if applicable - Responsible party contact information **Step 2: Verify Zoning Compliance** Contact Metro Codes Department to confirm your property's zoning allows STR use. Non-owner-occupied permits face strict zoning restrictions and are not available in residential zones (AR2A, R, RS, RM). **Step 3: Obtain Fire Safety Certification** As of March 1, 2022, the Metro Fire Marshal no longer conducts fire inspections for single and two-family homes. Instead: - Hire a **state-licensed architect, engineer, or home inspector** - Obtain written certification confirming compliance with applicable fire codes - Include smoke detectors and carbon monoxide detectors (required) - Ensure adequate emergency egress from all sleeping areas Multi-family buildings may require a Metro Fire Marshal inspection depending on local requirements. **Step 4: Notify Adjacent Property Owners** Send certified or registered mail notices to all neighbors whose properties border yours. This notifies neighbors of your STR operation and gives them the opportunity to respond to the city. Retain proof of delivery attempts for your application. **Step 5: Submit Complete Application** Submit to Metro Codes Department with: - Completed application form - All required documentation and proof of owner-occupation (if applicable) - Fire safety certification - Proof of neighbor notification (certified mail receipts) **Step 6: Schedule Inspection (if required)** Await notification from Metro Codes Department. Some properties may require an inspection. **Step 7: Pay Permit Fee** Submit the non-refundable **$313.00 permit fee**. This fee applies to both owner-occupied and non-owner-occupied permits. **Step 8: Receive Permit & Display** Once approved, you'll receive your STRP Permit. **Do not list your property on any platform until you have this permit in hand.** ### Renewal Requirements - Permits are valid for exactly **365 days** from issuance - Metro Codes Department sends renewal notifications via email **60 days before expiration** - Renewal requires submission of updated documentation and proof of continued compliance - **Operating under an expired permit triggers automatic 1-year ineligibility for new permits** - Permit non-renewal may be affected by a pattern of violations --- ## 2. Tax Obligations ### Hotel Occupancy Tax Nashville imposes a **6% local hotel occupancy tax** on all short-term rental stays. This is in addition to state and local sales taxes: | Tax Type | Rate | |----------|------| | Local Occupancy Tax | 6% | | State Sales Tax | 7% | | Local Sales Tax | 2.25% | | Nightly Admin Fee | $2.50 | | **Total Effective Rate** | **~16.25% + $2.50/night** | For a $100/night booking, guests would owe approximately **$16.25 + $2.50 = $18.75 in taxes and fees**, making the effective nightly rate $118.75. ### Tax Registration & Payment You must register separately with: 1. **Tennessee Department of Revenue** — for state occupancy tax 2. **Metro Nashville Finance Department** — for local occupancy tax Most STR platforms (Airbnb, VRBO, Booking.com) handle occupancy tax collection and remittance automatically. Verify with your platform regarding their tax handling responsibilities. ### Collection & Remittance - Occupancy taxes are typically collected from guests at booking - Monthly or quarterly remittance to city and state - Keep detailed records of all bookings, guest payments, and tax remittances - Failure to collect or remit taxes can result in audits and penalties --- ## 3. Operating Restrictions ### Permit Types & Unit Limitations | Scenario | Permitted Units | |----------|-----------------| | Owner-occupied, single/two-family home | 1 permit per lot | | Owner-occupied, larger property or multi-family | Multiple units (zoning-dependent) | | Non-owner-occupied, allowed zoning | Limited based on district regulations | ### Guest Occupancy Limits - Maximum **2 adults per bedroom** plus **2 additional guests** - Total occupancy cannot exceed safe egress capacity - Violations subject to $50–$500 fines per incident ### Rental Duration Restrictions - **All bookings must be less than 30 consecutive days per stay** - Guests booking 30+ days are considered long-term tenants and subject to Tennessee residential tenancy laws - This is not a "consecutive nights" rule — a single booking cannot span 30+ days ### Quiet Hours & Noise Ordinances - **Quiet hours: 10 PM to 7 AM** in residential areas - Hosts are responsible for ensuring guests comply with noise ordinances - Violations incur fines; repeat noise offenses can prevent permit renewal - Metro Codes Department enforces noise complaints; metro added a dedicated noise enforcement team in late 2023 ### Operating Hours Restrictions There are no explicit operating hour restrictions, but all rentals must comply with: - Local noise and nuisance ordinances - Residential zoning regulations - Guests must respect quiet hours and neighbor rights --- ## 4. Safety Requirements Nashville enforces strict fire and safety standards. Compliance is verified during the application process. ### Fire Safety Certification **For Single & Two-Family Homes (Effective March 1, 2022):** - Must be certified by a **state-licensed architect, engineer, or home inspector** (not the Fire Marshal) - Certification must confirm compliance with all applicable fire codes - This is now a property owner responsibility, not a city inspection **For Multi-Family Buildings:** - Fire Marshal may conduct an inspection if required by building code ### Required Safety Features | Requirement | Details | |-------------|---------| | **Smoke Detectors** | Required in all sleeping areas and common areas | | **Carbon Monoxide Detectors** | Required in all sleeping areas | | **Emergency Egress** | Adequate emergency exits from all sleeping areas (fire escape, windows, etc.) | | **Address Marking** | Property address clearly visible and legible from the street | | **Building Codes** | Full compliance with applicable Nashville building codes | ### Inspection Authority Metro Codes Department may conduct unannounced inspections: - During initial permit application review - In response to guest complaints - As part of routine compliance audits - After reported safety violations --- ## 5. Insurance Requirements ### Minimum Coverage All STR operators must maintain: - **Minimum $1+ million in property liability coverage** (per occurrence) - **Homeowner's/landlord's fire, hazard, and liability insurance** (minimum $1 million per occurrence) - Proof of insurance must be submitted with your permit application ### Types of Coverage **Homeowner's Policy with STR Rider:** - Standard homeowner's policies typically **exclude** STR income - You may add a **business liability rider** or **STR endorsement** to extend coverage - Many insurers now offer specific STR coverage products **Standalone STR Insurance:** - Increasingly available from specialty insurers - Covers liability, property damage, guest injuries, and theft - Often less expensive than homeowner + rider combination ### Proof of Insurance Keep proof of insurance (policy declarations page) readily available: - Required at permit application - May be requested during permit renewal - Should accompany your STRP Permit for guest confidence --- ## 6. Fines & Penalties Nashville Metro Codes Department aggressively enforces STR regulations. Violations carry substantial fines and permit consequences. | Violation | Fine / Consequence | |-----------|-------------------| | **Operating without valid permit** | **$50/day** (first violation); escalates to **$500/day** for repeat violations | | **Operating before permit issued** | **1-year automatic prohibition** on future permits (immediate ineligibility) | | **Guest occupancy violation** | **$50–$500** per violation (severity-dependent) | | **Noise/nuisance violation** | **$50–$500** per violation | | **Quiet hours violation** | **$50–$500** per violation | | **Pattern of violations** | **Permit non-renewal eligibility compromised** | | **Unresolved complaints** | Possible permit suspension or revocation | | **Operating under expired permit** | **1-year automatic prohibition** on new permits | ### Enforcement Activity - Metro Codes Department actively investigates complaints - A dedicated noise enforcement team was added in late 2023 - Violation patterns are tracked and materially affect renewal eligibility - Neighbors can report violations; city actively responds to complaints - Permit non-renewal becomes likely if violations accumulate --- ## 7. Platform vs. Host Responsibilities ### What Platforms Handle Most STR platforms (Airbnb, VRBO, Booking.com) manage: - **Tax collection:** Collecting occupancy taxes from guests at booking - **Tax remittance:** Sending collected taxes to Nashville and Tennessee on your behalf - **Payment processing:** Handling guest payments securely - **Cancellation policies:** Enforcing your cancellation policy - **Guest communication:** Initial contact and booking coordination ### What YOU Must Handle As the host, you are responsible for: - **Obtaining & maintaining the STRP Permit** (your legal obligation) - **Displaying your permit** at the property - **Maintaining compliance:** Fire safety, safety equipment, occupancy limits - **Managing guests:** Enforcing quiet hours, occupancy rules, noise ordinances - **Property maintenance:** Cleanliness, repairs, utilities - **Insurance:** Maintaining adequate coverage - **Record-keeping:** Booking records, guest lists, tax documents, maintenance logs - **Renewal deadlines:** Timely renewal of your STRP Permit (before 365-day expiration) ### Tax Clarification Even if your platform collects and remits taxes, **you remain liable for accurate tax reporting and payment.** If your platform fails to remit taxes or remits incorrectly, the city can pursue you for the difference. Verify with your platform that they are remitting Nashville occupancy taxes correctly. --- ## 8. Key Deadlines & Official Resources ### Critical Deadlines | Deadline | Action | |----------|--------| | **Before listing** | Obtain and have STRP Permit in hand | | **365 days after issuance** | Permit expires (automatic) | | **60 days before expiration** | Renewal notification sent via email | | **At least 2 weeks before expiration** | Submit renewal application | | **Immediately** | Update insurance if coverage lapses | ### Official Links & Contacts - **STR Permits Overview:** https://www.nashville.gov/departments/codes/short-term-rentals - **Apply for STRP Permit:** https://www.nashville.gov/departments/codes/short-term-rentals/apply-short-term-rental-property-permit - **Renew STRP Permit:** https://www.nashville.gov/departments/codes/short-term-rentals/renew-short-term-rental-property-permit - **HubNashville (Permit Portal & Renewal):** https://hub.nashville.gov/s/article/How-to-renew-a-STRP-Permit - **Pay Occupancy Tax:** https://www.nashville.gov/departments/finance/division-accounts/collections/pay-short-term-rental-property-occupancy-tax - **Metro Codes Department Contact:** hubNashville support or Metro Codes Department ### Getting Help - **Questions about permits?** Contact Metro Codes Department through the official Nashville website - **Tax questions?** Contact Nashville Finance Department or Tennessee Department of Revenue - **Property zoning questions?** Reach out to Metro Planning & Zoning --- ## Final Reminders 1. **Do not list without a permit.** Operating before your STRP Permit is issued results in a 1-year prohibition on future permits. 2. **Renew on time.** Set a calendar reminder for your 365-day renewal deadline. Operating under an expired permit also triggers the 1-year prohibition. 3. **Keep insurance current.** Property liability coverage must be maintained continuously. 4. **Manage guest conduct.** You're responsible for noise compliance and occupancy limits. 5. **Maintain records.** Keep all tax documents, insurance policies, maintenance logs, and guest lists for at least 3 years. Nashville's STR market is mature and well-regulated. Success requires staying compliant with all requirements, maintaining open communication with neighbors, and managing guest expectations clearly from the start.