Martha’s Vineyard, Massachusetts Short-Term Rental Regulation: A Guide For Airbnb Hosts

What are Short-Term Rental (Airbnb, VRBO) Regulations in Martha’s Vineyard, Massachusetts?

Short-term rentals like Airbnb and VRBO have become increasingly popular on Martha’s Vineyard in recent years. However, the island’s six towns have implemented various regulations to govern these types of rentals. Here’s what you need to know about short-term rental regulations on Martha’s Vineyard.

Starting a Short-Term Rental Business in Martha’s Vineyard

To legally operate a short-term rental on Martha’s Vineyard, property owners must comply with state and local regulations:

• Register with the Massachusetts Department of Revenue: As of July 1, 2019, all short-term rental operators in Massachusetts must register their properties with the state. Registration is free and can be completed online through MassTaxConnect. Hosts will receive a certificate number to add to their rental listings.
• Comply with local zoning bylaws: Each of the six Vineyard towns has its own zoning laws that dictate where short-term rentals are allowed. For example, West Tisbury is considering regulations that would limit owners to renting only one property for a minimum of seven days, with the owner required to reside at the property for at least 30 days a year. Check with your town’s building or zoning department for specific requirements.
• Obtain necessary permits and licenses: Some towns, like Tisbury, require short-term rental operators to obtain a business license. Others may require health and safety inspections. Contact your local town hall for guidance on permits and licenses.
• Collect and remit occupancy taxes: Short-term rentals on Martha’s Vineyard are subject to state and local occupancy taxes totaling 9.7% to 11.7%, depending on the town. Hosts must collect these taxes from guests and remit them to the appropriate authorities. Airbnb collects and remits these taxes on behalf of hosts for bookings made through its platform.

As of March 2022, there were over 2,650 properties registered as short-term rentals on Martha’s Vineyard. Rental agents report strong demand, with bookings for summer 2023 already soaring and inventory scarce. However, the growth of the short-term rental industry has also raised concerns about impacts on housing affordability and availability for year-round residents.

Some key considerations for starting a short-term rental business on Martha’s Vineyard include:

1. Researching and complying with all applicable state and local regulations
2. Preparing your property with necessary amenities, safety features, and insurance coverage
3. Setting competitive rates based on the local market
4. Marketing your listing through platforms like Airbnb and VRBO and/or working with a local rental agency
5. Establishing systems for booking management, guest communication, cleaning, and maintenance

By carefully navigating the regulatory landscape and prioritizing guest experience, short-term rental operators can tap into the strong demand for vacation accommodations on Martha’s Vineyard. However, it’s important to stay informed about evolving regulations as island communities seek to balance the economic benefits of short-term rentals with housing challenges.

Short-Term Rental Licensing Requirement in Martha’s Vineyard

Currently, there are no uniform short-term rental licensing requirements across all six towns on Martha’s Vineyard. However, some individual towns have implemented or are considering their own regulations:

West Tisbury: In April 2024, West Tisbury became the first town on the island to pass a bylaw regulating short-term rentals. The new regulations require:

1. Owners can rent only one of their properties as a short-term rental
2. A minimum rental period of two nights
3. Owners must reside in the rental property for at least 30 days per year
4. All short-term rentals must be registered annually with the town building department

Fines and penalties for non-compliance in West Tisbury have not yet been specified. The town is expected to form a committee to recommend rules and regulations to accompany the new bylaw.

Tisbury: Tisbury is the only other town on Martha’s Vineyard with some form of short-term rental regulation in place. Their rules provide liability protection for the town in case of any lawsuits related to short-term rentals. Specific licensing requirements and fees are not readily available on the town website.

The other towns - Edgartown, Oak Bluffs, Chilmark, and Aquinnah - do not currently have local short-term rental licensing requirements. However, all short-term rental operators on Martha’s Vineyard must comply with state-level regulations, including:

1. Registering with the Massachusetts Department of Revenue and obtaining a certificate number to add to rental listings
2. Collecting and remitting state and local occupancy taxes totaling 9.7% to 11.7%, depending on the town
3. Maintaining $1 million in liability insurance for each short-term rental property

Failure to comply with state tax and insurance requirements can result in penalties and legal issues for short-term rental operators. With the recent Massachusetts Land Court ruling that short-term rentals are not expressly allowed in residential zoning districts, more Vineyard towns are likely to consider implementing their own local regulations and licensing requirements in the near future. Hosts should monitor their town government websites and attend public meetings to stay informed of any changes.

Required Documents for Martha’s Vineyard Short-Term Rentals

Based on the information available from official town websites and local news sources, the required documents for short-term rentals can vary across the six towns on Martha’s Vineyard. However, there are some common requirements:

1. State Short-Term Rental Registration: As of July 1, 2019, all short-term rental operators in Massachusetts must register their properties with the state’s Department of Revenue. This can be done online through MassTaxConnect. Hosts will receive a certificate number to include on their rental listings.
2. Local Rental Registration or Permit: Some towns, like West Tisbury, require short-term rental properties to be registered annually with the town building department. The registration process ensures the property complies with local zoning and rental bylaws. Application forms are typically available on the town website or at the building department office.
3. Proof of Residence: For towns with residency requirements, like West Tisbury’s proposed bylaw mandating owners reside in the rental for at least 30 days per year, hosts may need to provide proof of residence such as a driver’s license, voter registration, or utility bills.
4. Floor Plans or Site Maps: Depending on the town’s zoning and building codes, short-term rental permit applications may need to include floor plans or site maps showing the layout and use of each room in the rental unit. These help verify compliance with occupancy limits and safety requirements.
5. Health and Safety Inspection Reports: Some towns may require short-term rentals to pass health and safety inspections. Tisbury is considering implementing an inspection requirement. Hosts would need to provide inspection reports or certificates from the relevant town departments.
6. Insurance Documentation: While not explicitly required by law, it’s strongly recommended that short-term rental hosts carry appropriate liability insurance. Some towns may request proof of insurance as part of the permit process. Hosts should contact their insurance provider for the necessary documentation.
7. Tax Registration and Reporting Forms: Short-term rentals are subject to state and local occupancy taxes. Hosts must register with the Department of Revenue and their town’s tax collector to receive the required forms for reporting and remitting taxes collected from guests.

It’s important to note that requirements can differ significantly between the Vineyard towns and are subject to change as new regulations are proposed and adopted. Hosts should carefully review their town’s specific short-term rental bylaws and contact the relevant town departments for the most current list of required documents and forms.

Martha’s Vineyard Short-Term Rental Taxes

Short-term rentals on Martha’s Vineyard are subject to several types of taxes that hosts must collect and remit to the appropriate authorities. Here’s a breakdown of the key taxes that apply and their rates:

Massachusetts State Excise Tax: The state excise tax rate is 5.7% of the total rent, including any cleaning fees, for all short-term rentals of 31 days or less.

Local Option Excise Tax: Each of the six towns on Martha’s Vineyard has adopted a local option excise tax on short-term rentals. As of 2023, the rates are:

1. Aquinnah: 4%
2. Chilmark: 4%
3. Edgartown: 4%
4. Oak Bluffs: 6%
5. Tisbury: 6%
6. West Tisbury: 6%

These local taxes are in addition to the state excise tax.

Cape Cod and Islands Water Protection Fund Excise Tax: Unlike the towns in Barnstable County on Cape Cod, the Martha’s Vineyard towns have not adopted the additional 2.75% excise tax to fund the Cape Cod and Islands Water Protection Fund. However, the towns could opt into this tax in the future with a majority vote at town meeting.

In total, short-term rental guests on Martha’s Vineyard can expect to pay between 9.7% to 11.7% in taxes on top of their rent, depending on the town. Hosts are responsible for collecting these taxes from guests and remitting them to the state.

Most major short-term rental platforms like Airbnb and VRBO collect and remit these taxes on behalf of hosts for bookings made through their sites. However, hosts should verify the tax collection arrangements with their platform and ensure compliance for any direct bookings.

Possible Write-Offs and Deductions

Short-term rental hosts on Martha’s Vineyard may be able to deduct certain expenses from their rental income to reduce their taxable income. Some common deductible expenses include:

1. Mortgage interest
2. Property taxes
3. Insurance
4. Utilities
5. Cleaning and maintenance costs
6. Supplies provided to guests
7. Platform service fees
8. Depreciation of the rental property

Hosts should keep detailed records of all rental expenses and consult with a tax professional to ensure they are claiming deductions correctly.

It’s important to note that Massachusetts does not allow short-term rental hosts to deduct the state and local excise taxes they collect and remit from their taxable rental income. These taxes are considered a direct pass-through from the guest to the government.

By understanding and complying with all applicable tax requirements, short-term rental hosts on Martha’s Vineyard can avoid penalties and help support local services and infrastructure. With strong demand and rising rental rates, the Island’s short-term rental tax revenues reached record highs in 2023 and are on track for further growth in 2024.

Massachusetts Wide Short-Term Rental Rules

In addition to local regulations on Martha’s Vineyard, short-term rental hosts must also comply with Massachusetts state laws. Here are some key state-wide rules that impact Vineyard STR operators:

1. State Registration: As of July 1, 2019, all short-term rental operators in Massachusetts must register their properties with the state’s Department of Revenue. This can be done online through MassTaxConnect. Hosts will receive a certificate number to include on their rental listings.
2. Occupancy Taxes: Short-term rentals are subject to the state room occupancy excise tax of 5.7%. This is in addition to any local occupancy taxes imposed by the individual Vineyard towns. Hosts are responsible for collecting these taxes from guests and remitting them to the state.
3. Insurance Requirements: Massachusetts law requires all short-term rental operators to carry a minimum of $1 million in liability insurance coverage. This can be through a standalone policy or an endorsement to an existing homeowners or renters policy. Proof of insurance must be available upon request.
4. Health and Safety Standards: The state’s Department of Public Health has issued minimum standards for short-term rentals, including requirements for smoke and carbon monoxide detectors, safe egresses, and sanitary conditions. Local boards of health may conduct inspections to ensure compliance.
5. Rental Agreement Disclosures: Hosts must provide guests with a written rental agreement that includes specific disclosures, such as the operator’s contact information, the amount of any security deposit, and a notice about the potential hazards of lead paint in older homes.
6. Occupancy Limits: State law caps occupancy at 2 persons per bedroom, up to a maximum of 6 people total, excluding children under 12. Local zoning bylaws may impose additional occupancy restrictions.
7. Anti-Discrimination: Short-term rental operators are subject to the state’s anti-discrimination laws and cannot refuse accommodation based on a guest’s race, color, religious creed, national origin, sex, gender identity, sexual orientation, ancestry, or disability.

It’s important to note that these state-wide rules are in addition to, not in place of, any local regulations adopted by the individual Vineyard towns. Hosts must comply with both sets of requirements to operate legally.

The Massachusetts Department of Revenue and Attorney General’s Office provide detailed guidance and resources for short-term rental operators on their websites. Consulting with a local attorney or tax professional can also help hosts navigate the complexities of state and local regulations.

As the short-term rental industry continues to evolve, it’s crucial for Vineyard hosts to stay informed about any changes to state laws that may impact their operations. Compliance with all applicable rules is essential for running a successful and sustainable short-term rental business on Martha’s Vineyard.

Does Martha’s Vineyard Strictly Enforce STR Rules?

Based on discussions in online forums like Reddit and local news sources, it appears that enforcement of short-term rental regulations varies across the six towns on Martha’s Vineyard. Some towns have taken a stricter approach, while others have been more lenient.

West Tisbury recently became the first town on the island to pass a bylaw specifically regulating short-term rentals. The new rules, which took effect in April 2024, limit owners to renting only one of their properties, require a minimum two-night stay, and mandate that owners reside in the rental for at least 30 days per year. This suggests West Tisbury is taking a firm stance on reining in short-term rentals.

In contrast, other towns like Edgartown and Oak Bluffs have historically been more accommodating to vacation rentals, with a significant portion of their housing stock dedicated to seasonal rentals. However, with the recent Massachusetts Land Court ruling that short-term rentals are not expressly allowed in residential zoning districts, these towns may be forced to reevaluate their policies.

On the Airbnb subreddit, hosts have expressed frustration with the increasing regulations and the lack of clarity around enforcement. One commenter noted, “I’ve been renting my family’s Vineyard home for years without any issues, but now I’m worried about getting fined or shut down. The rules seem to be changing every year.”

Another host on the Martha’s Vineyard section of the Bigger Pockets forums wrote, “The towns here talk a big game about cracking down on illegal rentals, but enforcement seems to be hit or miss. Some problem properties get busted, but plenty of others fly under the radar.”

So, while Martha’s Vineyard may not be as overtly Airbnb-friendly as some other vacation destinations, the reality is that many hosts continue to operate short-term rentals, sometimes despite the rules. The island’s tourism-based economy relies heavily on vacation rentals, so there is an inherent tension between preserving this revenue stream and addressing the housing crisis.

As one Vineyard homeowner argued in a letter to the editor, “We need to enforce residential zoning to prohibit short-term rentals (a commercial use). If we do this, prices will moderate, and we won’t have a housing crisis”. But this view is far from universal among islanders.

In summary, Martha’s Vineyard seems to be at a crossroads with short-term rentals - caught between the economic benefits they provide and the pressure they put on the housing market. Enforcement of STR regulations is inconsistent across the island’s towns, though the tide may be turning towards stricter policies. For now, many hosts continue to operate in a legal gray area, but the long-term viability of Airbnb on the Vineyard remains uncertain.

How to Start a Short-Term Rental Business in Martha’s Vineyard

Starting a short-term rental business on Martha’s Vineyard can be a lucrative venture, but it’s important to understand the local regulations and take the necessary steps to ensure compliance and success. Here’s a step-by-step guide to getting started:

1. Research local regulations: Before investing in a property, thoroughly research the short-term rental regulations for the specific town where your property is located. Each of the six Vineyard towns has its own zoning bylaws and requirements. Understand the rules around registration, permits, occupancy limits, and health and safety standards.
2. Register with the state: As of July 1, 2019, all short-term rental operators in Massachusetts must register their properties with the Department of Revenue. This can be done online through MassTaxConnect. You’ll receive a certificate number to include on your rental listings.
3. Obtain necessary local permits: Some towns, like Tisbury, require short-term rental operators to obtain a business license. Others may require health and safety inspections. Contact the relevant town departments for guidance on the specific permits and inspections needed for your property.
4. Prepare your property: Make sure your rental property is clean, well-maintained, and stocked with essentials like linens, towels, and kitchen supplies. Consider providing additional amenities like beach gear or outdoor furniture to enhance the guest experience. Hire a professional photographer to showcase your property’s best features in your listings.
5. Set up a system for managing bookings and guests: Decide how you will handle reservations, guest communication, check-in/check-out, and cleaning. You can choose to self-manage or hire a professional property management company. Establish clear house rules and rental agreements to set expectations for guests.
6. Create enticing listings: List your property on popular vacation rental platforms like Airbnb, VRBO, and WeNeedaVacation.com. Craft compelling descriptions that highlight your property’s unique features and selling points. Set competitive rates based on the local market and your property’s amenities.
7. Comply with tax requirements: Short-term rentals on Martha’s Vineyard are subject to state and local occupancy taxes totaling 9.7% to 11.7%, depending on the town. Register with the state and your town’s tax collector to receive the required forms for reporting and remitting taxes. If you use a platform like Airbnb, they may collect and remit taxes on your behalf.
8. Ensure adequate insurance coverage: Contact your insurance provider to make sure you have appropriate liability coverage for your short-term rental. Most homeowners policies don’t cover commercial use, so you may need to purchase additional coverage.
9. Market your listing: In addition to the major rental platforms, promote your property through social media, local vacation guides, and by encouraging satisfied guests to leave reviews. Consider offering special promotions or discounts during shoulder seasons to attract more bookings.
10. Provide excellent guest service: Respond promptly to inquiries, provide clear check-in instructions, and make sure your property is well-prepared for each guest. Consider providing local recommendations or a welcome basket to make guests feel at home. Solicit feedback and continuously look for ways to improve the guest experience.

By following these steps and staying informed about local regulations, you can launch and grow a successful short-term rental business on Martha’s Vineyard. The key is to prioritize compliance, deliver a high-quality guest experience, and adapt to the evolving market conditions. With the Island’s strong demand for vacation rentals, there’s great potential for hosts who approach the business thoughtfully and responsibly.

Who to Contact in Martha’s Vineyard about Short-Term Rental Regulations and Zoning?

If you have questions or concerns about short-term rental regulations and zoning on Martha’s Vineyard, here are some key contacts and resources for each town:

• Aquinnah
  Building Department: (508) 645-2300
  Zoning Board of Appeals: (508) 645-2300
  Website: https://www.aquinnah-ma.gov/
• Chilmark
  Building Department: (508) 645-2100 ext. 2
  Zoning Board of Appeals: (508) 645-2100 ext. 2
  Website: https://www.chilmarkma.gov/
• Edgartown
  Building Department: (508) 627-6170
  Zoning Board of Appeals: (508) 627-6180
  Website: https://www.edgartown-ma.us/
• Oak Bluffs
  Building Department: (508) 693-3554 ext. 127
  Zoning Board of Appeals: (508) 693-3554 ext. 149
  Website: https://www.oakbluffsma.gov/
• Tisbury
• Building & Zoning Department: (508) 696-4280
  Short-Term Rental Information: https://www.tisburyma.gov/select-board/news/short-term-rental-regulations-and-fee
  Website: https://www.tisburyma.gov/
• West Tisbury
  Building Department: (508) 696-0113
  Zoning Board of Appeals: (508) 696-0107
  Short-Term Rental Committee: Jane Rossi, (508) 696-0149
  Website: https://www.westtisbury-ma.gov/
• Martha’s Vineyard Commission
  Contact: Lucy Morrison, Executive Assistant
  Phone: (508) 693-3453
  Email: morrison@mvcommission.org
  Website: https://www.mvcommission.org/

The MVC is the regional planning agency for Dukes County, MA which includes Martha’s Vineyard and the Elizabeth Islands. They provide technical assistance to towns on issues like zoning, housing, and economic development.

Useful Communities for Martha’s Vineyard Short-Term Rental Hosts

• MV Housing Rentals Facebook Group: https://www.facebook.com/groups/mvhousingrentals/
• MV Long-Term Rentals Facebook Group: https://www.facebook.com/groups/mvlongtermrentals/

These groups are geared towards seasonal workers and longer rentals, but occasionally have posts related to short-term rentals as well.

Martha’s Vineyard Online Forums: https://www.mvol.com/forums/list.php?1

The “Real Estate” sub-forum sometimes has discussions on short-term rental topics.

Vineyard Gazette “Short-Term Rentals” Topic Page: https://vineyardgazette.com/tm/collection/Short-term-rentals

The Vineyard Gazette, the island’s newspaper of record, has ongoing coverage of short-term rental news and developments.

These official town contacts and community resources can provide guidance on navigating the evolving short-term rental landscape on Martha’s Vineyard. It’s important for hosts to stay informed and engaged with their local officials to ensure compliance with all applicable regulations.

What Do Airbnb Hosts in Martha’s Vineyard on Reddit and Bigger Pockets Think about Local Regulations?

Airbnb hosts on Martha’s Vineyard have expressed a range of opinions about the island’s evolving short-term rental regulations on forums like Reddit and Bigger Pockets. Here are some insights from local hosts:

On the Martha’s Vineyard subreddit, one host shared their frustration with the lack of clarity around enforcement of existing rules: “I've been renting my family's Vineyard home for years without any issues, but now I'm worried about getting fined or shut down. The rules seem to be changing every year."

In response to a post about West Tisbury's new short-term rental bylaw on the Vineyard Gazette's website, a commenter who identified as a short-term rental host wrote: "The short term rental by law passed by WT residents seems well intentioned. The real test will come with implementation by Town Select Board on establishing rules, fees, inspections and enforcement. Hopefully they will not be so draconian that the little guy who rents their property to help with costs will not be squeezed out!"

On the Bigger Pockets forums, a member considering investing in a Vineyard rental property expressed concerns about the regulatory environment: "With all the talk of cracking down on Airbnbs on the island, I'm hesitant to pull the trigger. It seems like the towns are making it harder and harder to operate a vacation rental legally."

Another Bigger Pockets member shared their experience as a long-time Vineyard vacation rental owner: "I've been renting out my Edgartown home for over a decade, well before Airbnb was even a thing. I understand the need for some regulation, but I worry that the pendulum is swinging too far in the other direction. We need a balanced approach that protects housing while still allowing responsible owners to rent."

So, while opinions vary, there seems to be a general sense of uncertainty and concern among Vineyard short-term rental hosts about the direction of local regulations. Many feel that the rules are becoming increasingly restrictive and difficult to navigate, putting their rental businesses at risk.

At the same time, some hosts acknowledge the need for reasonable regulations to address the housing crisis and preserve community character. The challenge for island officials will be striking the right balance between competing priorities.

As the regulatory landscape continues to evolve, it will be important for Vineyard short-term rental operators to stay engaged with local policymakers, share their perspectives, and adapt their business practices to remain compliant. Online forums can be a valuable way for hosts to connect with each other, share information, and advocate for their collective interests.

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.