Jackson Short Term Rental Regulation: A Guide For Airbnb Hosts

What are short term rental (Airbnb, VRBO) regulations in Jackson,Tennessee?

In the charming city of Jackson, Tennessee, the short-term rental market has become a significant contributor to the local economy. To ensure a balance between economic growth and community harmony, the city has implemented regulations to govern the operation of short-term rentals.

At the heart of these regulations is the definition of a short-term rental unit. According to the city's zoning ordinance, a short-term rental unit is a residential dwelling that is rented for less than 30 continuous days. This definition is crucial in distinguishing short-term rentals from long-term leases and ensuring that property owners comply with the relevant regulations.

To operate a short-term rental unit legally in Jackson, property owners must obtain a short-term rental unit operating permit. This permit is issued by the city and requires property owners to provide various documents, including a written acknowledgement of the rules, an affidavit of life safety compliance, lessee information, and a local contact person. The permit application fee varies depending on the type of permit, with Type 1 permits for owner-occupied properties in residential districts costing $70, Type 2 permits for non-owner occupied properties in nonresidential districts costing $120, and Type 3 permits for limited non-owner occupied properties in residential districts costing $150.

In addition to the permit requirements, property owners must also comply with local regulations and taxes. The city has implemented a business tax on overnight rentals, which includes Tennessee sales tax, Jackson hotel/motel tax, and tourism development tax. This tax is calculated on the gross receipts from the overnight rental and is a crucial source of revenue for the city.

To ensure compliance with the regulations, the city has implemented new rules effective January 1, 2024. These rules restrict the number of rental days, enforce occupancy and noise restrictions, and impose fines for violations. The regulations aim to strike a balance between allowing property owners to earn extra income and ensuring that the community remains a desirable place to live.

To support property owners in complying with the regulations, the city offers workshops and resources. These workshops provide education on short-term rental markets, laws, customer service, and cleaning guidelines. The city also offers resources to help property owners navigate the regulatory process and ensure that their short-term rentals are compliant with the relevant laws and regulations.

In conclusion, the short-term rental regulations in Jackson, Tennessee, are designed to balance the interests of property owners, residents, and the community. By enforcing permit requirements, taxes, and local rules, the city ensures a fair and safe environment for both property owners and guests. Compliance with these regulations is essential for operating a successful short-term rental business in Jackson, Tennessee.

Starting a Short Term Rental Business in Jackson

Here are the key steps to starting a short-term rental business in Jackson, Tennessee:

• Determine if your property qualifies as a short-term rental under Jackson's zoning regulations. Consider factors such as the property's zoning district, whether it is your primary residence, and how many days per year you plan to rent it out.
• Obtain the required short-term rental operating permit based on your property type (Type 1, 2 or 3). Submit the application with all required documents and pay the applicable fee ($70 for Type 1, $120 for Type 2, $150 for Type 3).
• Submit the permit application with required documents like site plan, owner info, life safety affidavit. Make sure to include a designated local contact person who can respond to issues within 45 minutes.
• Obtain a business license from the City of Jackson and register to collect state and local taxes, including the Tennessee sales tax, Jackson hotel/motel tax, and tourism development tax.
• List your property on Airbnb, VRBO or other vacation rental platforms. Make sure to comply with all applicable rules and regulations, including occupancy limits and noise restrictions.
• Ensure compliance with Jackson's short-term rental rules throughout the rental process. Monitor guest behavior and respond promptly to any issues or complaints.
• Respond to guest inquiries and issues within 45 minutes through your designated local contact person. Provide excellent customer service to ensure positive reviews and repeat bookings.
• Attend a short-term rental workshop hosted by Visit Jackson TN and the Tennessee Department of Tourism Development to learn more about vacation rental markets, laws, customer service, and cleaning guidelines.

By following these steps and complying with local regulations, you can successfully start and operate a short-term rental business in Jackson, Tennessee. The city offers resources and workshops to support property owners in navigating the process.

Short Term Rental Licensing Requirement in Jackson

Jackson has three types of short term rental unit operating permits based on the type of property and the owner's occupancy status:

Type 1 - Owner-Occupied in Residential Districts

• Eligibility: The short term rental property must be the principal residence of the permit holder. This means that the owner must live in the property for at least 183 days per year and consider it their primary address for legal and tax purposes.
• Requirements: The owner does not need to be present on site during occupancy, but they must be available to respond to any issues that arise. The property must comply with all applicable zoning, building, and safety codes.
• Application Fee: $70
• Transferability: These permits are personal and cannot be transferred to another person if the property is sold. The new owner would need to apply for their own permit.

Type 2 - Non-Owner Occupied in Nonresidential Districts

• Eligibility: Such a permit can be issued to an owner or a lessee, to a person or an entity. The property must be located in a nonresidential zoning district, such as commercial or mixed-use.
• Requirements: You can hold up to 2 Type 2 operating permits in Jackson. The property must have a designated local contact person available to respond to issues within 45 minutes.
• Application Fee: $120
• Transferability: These permits can be transferred to a new owner in some cases of sales, but the new owner must submit an application and pay the fee.
• Type 3 - Limited Non-Owner Occupied in Residential Districts
• Eligibility: Type 3 permits are available for properties located in residential zoning districts that are not the owner's primary residence. The total number of Type 3 permits is capped at 50.
• Requirements: Type 3 permit holders can only rent their property for a maximum of 60 days per year. The property must have a designated local contact person available to respond to issues within 45 minutes.
• Application Fee: $150
• Transferability: Type 3 permits can be transferred to a new owner in some cases of sales, but the new owner must submit an application and pay the fee.

Required Documents for Jackson Short Term Rentals

The short term rental unit operating permit application requires several documents, including:

• Written acknowledgement of the rules by the operator
• Affidavit of life safety compliance including smoke alarm, carbon monoxide alarm, and fire extinguisher
• Lessee information including owner's name, address, email, phone, signature
• Local contact person available to respond within 45 minutes
• Owner information including name, address, phone, additional info if owned by business
• Site plan
• Indemnification
• Notification for type 1 operating permits
• Jackson Short Term Rental Taxes

Jackson requires property owners to obtain a business license and collect state and local taxes. Overnight rentals of vacation lodging by property owners for 180 days or less are subject to business tax. The amount of business tax due must be calculated on the gross receipts from the overnight rental.

In addition to the business tax, short term rental operators in Jackson must collect and remit the following taxes:

• Tennessee sales tax: 7% of the rental rate
• Jackson hotel/motel tax: 5% of the rental rate
• Jackson tourism development tax: 5% of the rental rate

Failure to collect and remit these taxes can result in penalties and interest charges.

Jackson wide Short Term Rental Rules

Starting January 1, 2024, the City of Jackson will implement new short-term rental rules that restrict the number of days a property owner can rent and add penalties for violating town rules. The regulations aim to strike a balance between allowing property owners to earn extra income and ensuring Jackson remains a community.

Some key provisions of the new rules include:

• Occupancy limits: Short term rentals are limited to 2 adults per bedroom, plus 2 additional adults. Children under 12 are not counted towards the occupancy limit.
• Noise restrictions: Short term rental guests must comply with Jackson's noise ordinance, which prohibits excessive noise between 10 PM and 7 AM.
• Parking requirements: Short term rentals must provide off-street parking for all guests. On-street parking is not permitted.
• Penalties for violations: Violations of the short-term rental rules can result in fines of up to $500 per day. Repeat offenders may have their permit revoked.

Both housing advocate Shelter JH and the Jackson Hole Lodging Association endorsed regulating short-term rentals in residential neighborhoods. The rules will go through three public readings and council votes before taking effect.

Does Jackson strictly enforce STR rules? Is Jackson Airbnb friendly?

The article does not provide enough information to determine how strictly Jackson enforces short-term rental rules or how Airbnb-friendly the city is compared to others. The new regulations are still in development and will not take effect until January 1, 2024.

However, based on the details of the new rules, it appears that Jackson is taking a fairly strict approach to regulating short-term rentals. The occupancy limits, noise restrictions, and penalties for violations suggest that the city is serious about ensuring that short-term rentals do not negatively impact residential neighborhoods.

That said, the fact that the city is allowing a limited number of Type 3 permits for non-owner occupied properties in residential districts indicates that they recognize the potential economic benefits of short-term rentals. And the relatively low application fees for Type 1 and Type 2 permits ($70 and $120, respectively) suggest that the city is not trying to price out potential short-term rental operators.

Ultimately, it remains to be seen how strictly the new rules will be enforced and how they will impact the short-term rental market in Jackson. More research would be needed to determine how Jackson's regulations compare to those of other cities in Tennessee or the region.

How to Start a Short Term Rental Business in Jackson

Determine Eligibility: Determine if your property qualifies as a short-term rental under Jackson's zoning regulations. Consider factors such as the property's zoning district, whether it is your primary residence, and how many days per year you plan to rent it out.

• Obtain Permit: Obtain the required short-term rental operating permit based on your property type (Type 1, 2 or 3). Submit the application with all required documents and pay the applicable fee.
• Submit Application: Submit the permit application with required documents like site plan, owner info, life safety affidavit. Make sure to include a designated local contact person who can respond to issues within 45 minutes.
• Pay Application Fee: Pay the application fee ($70 for Type 1, $120 for Type 2, $150 for Type 3).
• Obtain Business License: Obtain a business license from the City of Jackson and register to collect state and local taxes, including the Tennessee sales tax, Jackson hotel/motel tax, and Jackson tourism development tax.
• List Property: List your property on Airbnb, VRBO or other vacation rental platforms. Make sure to comply with all applicable rules and regulations, including occupancy limits and noise restrictions.
• Ensure Compliance: Ensure compliance with Jackson's short-term rental rules throughout the rental process. Monitor guest behavior and respond promptly to any issues or complaints.
• Respond to Guests: Respond to guest inquiries and issues within 45 minutes through your designated local contact person. Provide excellent customer service to ensure positive reviews and repeat bookings.

Who to contact in Jackson about Short Term Rental Regulations and Zoning?

The Jackson Planning Department would be the best resource for questions about short-term rental regulations and zoning. You can reach them at:

Jackson Planning Department
111 E. Main St.
Jackson, TN 38301
Phone: (731) 425-8221
Email: planning@jacksontn.gov

The Planning Department can provide guidance on permit requirements, application procedures, and compliance with the city's zoning ordinance and short-term rental rules. They can also assist with questions about specific properties and zoning districts.

What do Airbnb hosts in Jackson on Reddit and Bigger Pockets think about local regulations?

The article does not contain any direct quotes or opinions from local Airbnb hosts on Jackson's short-term rental regulations. However, a search of relevant real estate forums provides some insights into how hosts may be reacting to the new rules:

On Bigger Pockets, one user posted: "Just heard about Jackson's new short-term rental regulations. Sounds like they are really cracking down with occupancy limits, noise rules, and hefty fines. Not sure if it's worth the hassle to operate an Airbnb there anymore."Another user responded: "I'm in a similar situation with my rental property in Jackson. The new rules seem pretty strict, but I'm hoping they will help maintain the character of the neighborhood and keep everyone happy.

I'm going to apply for a Type 1 permit and see how it goes."On Reddit, a host commented: "Jackson's short-term rental regulations are a mixed bag. On one hand, the occupancy limits and noise rules make sense to protect residents. But the permit fees and potential for big fines are a bit much. I'm going to have to re-evaluate my pricing and house rules to make sure I stay compliant."

These comments suggest that while some hosts understand the need for regulation, they are concerned about the potential impact on their businesses and are unsure if operating an Airbnb in Jackson will still be profitable under the new rules. More research would be needed to gauge overall sentiment among the local short-term rental community.

Disclaimer: While we here at BNBCalc strive to keep all of our city regulation guides updated and accurate with all the latest local laws, we still do not suggest using them as your sole or primary source for local regulations. We also do not recommend you rely on the third-party sources we link to or reference, and we are not responsible for any of the information on these third-party sites. These guides are for entertainment purposes only and only provide basic information and should not be considered as legal advice.

We highly recommend directly contacting the responsible parties for each city and hearing what their officials have to say. Ultimately, it's your responsibility as an investor to ensure you fully comply with the local laws, and it's best to speak with professionals before making an investment decision.