Mercer County, New Jersey Short-Term Rental Regulation: A Guide For Airbnb Hosts

What are Short-Term Rental (Airbnb, VRBO) Regulations in Mercer County, New Jersey?

Short-term rentals through platforms like Airbnb and VRBO have become increasingly popular in Mercer County, New Jersey. However, local municipalities have enacted various regulations on STRs that property owners need to be aware of before listing their home. Here is an overview of some of the key STR rules across Mercer County.

Starting a Short-Term Rental Business in Mercer County

Mercer County itself does not have countywide STR regulations. Instead, rules are set by each individual municipality. Property owners should check their local township or borough ordinances for specific STR requirements.

For example, in Hamilton Township, STRs are prohibited in all residential zones. The township code states: "Notwithstanding anything to the contrary contained in the Township Code, it shall be unlawful for an owner, lessor, sublessor, any other person(s) or entity(ies) with possessory or use right(s) in a dwelling unit...to receive or obtain actual or anticipated consideration for soliciting, advertising, offering, and/or permitting, allowing, or failing to discontinue the use or occupancy of any dwelling unit...for a period of 30 days or less."

Pennington Borough also recently passed an ordinance regulating STRs in 2022. Key provisions include:

• STRs must be the owner's primary residence
• Rentals are limited to 60 days per year when the owner is not present
• The property owner or their designated representative must be available 24/7 to address issues
• The owner's designated representative must have a principal residence or place of business in Mercer County

Trenton, the county seat, requires STR operators to register annually and pay a $300 first-year registration fee, followed by a $150 annual renewal fee. The city also collects a 1% municipal occupancy tax from STRs.

Real estate investors on online forums have discussed the potential for medium-term rentals (1-6 months) targeting traveling professionals in the Princeton/Hamilton area. However, they note the importance of understanding local demand and analyzing the market carefully.

Overall, the regulatory environment for STRs varies significantly across Mercer County. With rules differing from town to town, it's critical for STR operators to research their specific municipality's requirements. Failing to comply can result in fines and penalties.

According to a local columnist, "Mercer County towns need to pass Airbnb laws, and do it now" to get ahead of the growing STR industry. Some New Jersey cities like Jersey City have already implemented 60-day annual caps on STR properties.

As the STR market continues to evolve, Mercer County property owners should stay informed on any regulatory changes that could impact their ability to list their home on platforms like Airbnb and VRBO. Consulting with a local real estate attorney can help navigate the complex web of municipal STR ordinances across the county.

Short-Term Rental Licensing Requirements in Mercer County

While Mercer County itself does not have countywide short-term rental licensing requirements, many of the individual municipalities within the county do require STR operators to obtain a permit or license. The specific requirements vary by town. Here is an overview of the licensing process in a few key Mercer County municipalities:

Pennington Borough enacted an ordinance regulating STRs in 2022. Key provisions include:

1. STRs are limited to the owner's primary residence
2. Rentals are restricted to a maximum of 60 days per year when the owner is not present
3. The owner or their designated representative must be available 24/7 to address issues and must have a principal residence or place of business in Mercer County
4. Owners must obtain an annual STR permit from the Borough Clerk and pay a $250 application fee
5. Failure to comply can result in fines up to $2,000 per day and potential revocation of the STR permit

In Trenton, the county seat, STR operators must:

1. Register annually with the city and pay a $300 first-year registration fee, followed by a $150 annual renewal fee
2. Make their property available for city inspections every 5 years
3. Face potential fines of $100 per day for operating an unregistered STR

The city of Trenton collects a 1% municipal occupancy tax from STRs in addition to registration fees.

Hamilton Township prohibits STRs entirely in all residential zones under the township code. The ordinance states it is "unlawful for an owner, lessor, sublessor, any other person(s) or entity(ies) with possessory or use right(s) in a dwelling unit...to receive or obtain actual or anticipated consideration for soliciting, advertising, offering, and/or permitting, allowing, or failing to discontinue the use or occupancy of any dwelling unit...for a period of 30 days or less."

Other Mercer County towns like Princeton, Hopewell, and Lawrence Township do not currently have specific STR ordinances on the books. However, all STR operators should check with their local zoning and code enforcement offices to ensure they are in compliance with any general rental property requirements.

The Mercer County Planning Board provides resources on the land development application process in the county, but does not directly address STR licensing. For STR permit applications, fees, and other requirements, property owners must contact their municipal government offices directly.

Turnaround times for STR permit approvals vary by town and may require scheduling inspections, but the process typically takes at least 30 days or more. With many Mercer County municipalities enacting new STR ordinances in recent years, it's critical for hosts to stay up-to-date on evolving local regulations to avoid potential fines and penalties. Consulting with a local real estate attorney can provide added peace of mind.

Required Documents for Mercer County Short-Term Rentals

The specific documents required to operate a short-term rental in Mercer County vary by municipality. However, most towns with STR ordinances require some combination of the following:

STR Permit or License Application

1. Purpose: Registers the STR with the town and provides key property/contact information
2. Obtain from: Municipal clerk's office or code enforcement department

Proof of Property Ownership

1. Purpose: Verifies the applicant owns the STR property
2. Obtain from: Property deed or tax records

Liability Insurance Certificate

1. Purpose: Shows the STR has the minimum liability coverage required by the town (typically $500,000+)
2. Obtain from: Property insurance provider

Property Site Plan/Floor Plan

1. Purpose: Confirms the STR layout complies with building codes and occupancy limits
2. Obtain from: Existing plans or hire an architect to create

Parking Plan

1. Purpose: Details the number and location of on-site parking spaces for STR guests
2. Obtain from: Created by STR owner or property manager

Fire Inspection Certificate

1. Purpose: Verifies the STR has working smoke and carbon monoxide detectors and fire extinguishers
2. Obtain from: Local fire marshal's office inspection

Health/Sanitation Inspection Certificate

• Purpose: Confirms the STR meets all health and sanitation standards
• Obtain from: Municipal health department inspection

Neighbor Notification Letter

• Purpose: Informs adjacent property owners of STR use and provides 24/7 contact info
• Obtain from: Draft and send to neighbors, following town template

For example, Trenton's STR ordinance requires operators to submit items 1-6 above as part of the annual registration process. The Trenton Division of Housing Inspection conducts property inspections every 5 years.

Hopewell Township has one of the most extensive STR requirements in Mercer County. In addition to items 1-7 above, Hopewell also requires:

• Designated Responsible Party Form: Identifies a local contact person available 24/7
• Listing of all hosting platforms used to advertise the STR
• Trash removal plan
• Noise management plan
• Sample rental agreement

Hopewell STRs must renew their permit annually and have property inspections every 3 years. The township code also limits STRs to 60 rental nights per year when the owner is not present.

To ensure compliance with all local requirements, Mercer County STR operators should carefully review their town's ordinances and contact their municipal clerk's office with any questions. Failure to submit required documents can result in rejected permit applications, fines, and even bans on future STR activity.

Mercer County Short-Term Rental Taxes

Short-term rental operators in Mercer County need to collect and remit several state and local taxes. Here is a breakdown of the key taxes that apply to STRs:

New Jersey Sales and Use Tax (6.625%)

• Applies to all STR stays under 90 consecutive nights
• STR marketplaces like Airbnb and Vrbo are required to collect and remit this tax on behalf of hosts

New Jersey Hotel Occupancy Fee (5%)

• Applies to STR stays under 90 consecutive nights in addition to the sales tax
• Also collected and remitted by STR marketplaces on behalf of hosts

Mercer County Hotel Tax (1%)

• Trenton and some other Mercer County municipalities charge an additional 1% occupancy tax
• STR hosts are responsible for collecting and remitting this tax to their local tax collector
• For example, Trenton charges hosts a $300 first-year registration fee and $150 annual renewal fee in addition to the 1% tax

In total, STR guests in Mercer County can expect to pay a 12.625% tax on their stay (6.625% sales tax + 5% occupancy fee + 1% county tax). This is one of the highest STR tax rates in New Jersey.

STR marketplaces like Airbnb and Vrbo automatically collect the 11.625% in state taxes for hosts. However, hosts are still responsible for registering with their municipality and collecting any additional local taxes and fees.

Failing to comply with STR tax requirements can result in significant penalties. In Trenton, unregistered STRs face fines of $100 per day. Hopewell Township has some of the strictest requirements in Mercer County - STRs there must renew permits annually, have property inspections every 3 years, and are limited to just 60 rental nights per year when the owner is not present.

As for possible write-offs, STR operators can typically deduct expenses directly related to renting the property. This may include cleaning fees, maintenance, repairs, advertising, insurance, mortgage interest, property taxes, and depreciation. Consulting a tax professional is recommended to ensure all eligible deductions are claimed.

With demand for Jersey Shore rentals surging, the 11.6% statewide tax on STRs under 14 days has proven controversial. But for STR operators in Mercer County, this "Airbnb tax" is just one component of a complex web of state and local tax requirements to navigate. Careful research and professional guidance are essential to remain compliant and maximize after-tax returns in this rapidly evolving market.

New Jersey Wide Short-Term Rental Rules

In addition to local regulations in Mercer County municipalities, short-term rental (STR) hosts must also comply with statewide laws in New Jersey. Here is an overview of the key state requirements:

Sales and Occupancy Taxes

• New Jersey imposes taxes totaling 11.625% on STRs statewide: 6.625% sales tax and a 5% hotel occupancy fee
• STR marketplaces like Airbnb and Vrbo are required to collect and remit these taxes on behalf of hosts
• However, hosts are still responsible for collecting any additional local taxes, like Trenton's 1% occupancy tax

Multiple Dwelling Reporting Rule

• Properties with 3+ rental units must file a certificate of registration and pay a $10 per unit fee annually to the Bureau of Housing Inspection
• Quarterly reports must also be submitted identifying the number and location of units

Landlord Registration

• Owners renting a property must register with their municipality, pay a registration fee, and provide an emergency contact number for the property
• Fees and specific requirements vary by municipality

Liability Insurance

1. While not legally required statewide, it is highly recommended that STR hosts carry a minimum of $500,000 in liability insurance
2. Some municipalities, like Jersey City and Hoboken, mandate certain liability coverage amounts for STRs

New Jersey Smoke Alarm, Carbon Monoxide, and Portable Fire Extinguisher Compliance Act

1. All rental properties must install smoke and carbon monoxide detectors and provide fire extinguishers in each unit
2. Specific placement requirements apply based on property type

Ultimately, it's critical for Mercer County STR hosts to understand both state and local requirements to avoid fines and maintain compliance. Working with a local real estate attorney well-versed in New Jersey's STR landscape is advisable.

The statewide taxes, registration, and insurance requirements create a baseline for STR operators. However, Mercer County municipalities like Trenton, Princeton, and Hamilton Township have the authority to layer additional regulations on top.

As the STR market heats up in Mercer County, hosts should stay alert to any new or changing state and local laws. With the proper planning and due diligence, STRs can offer a profitable opportunity in this corner of the Garden State.

Does Mercer County Strictly Enforce STR Rules?

Based on discussions among real estate investors on forums like Bigger Pockets and Reddit, Mercer County appears to take a relatively strict approach to enforcing short-term rental regulations compared to other New Jersey counties. Many municipalities within Mercer County have enacted detailed ordinances governing STRs in recent years.

For example, Hamilton Township, the most populous town in Mercer County, passed an ordinance in 2020 completely prohibiting STRs in all residential zones. The ordinance language is quite strong, stating it is "unlawful for an owner, lessor, sublessor, any other person(s) or entity(ies) with possessory or use right(s) in a dwelling unit...to receive or obtain actual or anticipated consideration for soliciting, advertising, offering, and/or permitting, allowing, or failing to discontinue the use or occupancy of any dwelling unit...for a period of 30 days or less."

Violations in Hamilton Township can result in fines ranging from $100 to $2,000 and up to 90 days imprisonment per offense. The township appears to be actively enforcing the ordinance, with several cases making local headlines for racking up tens of thousands of dollars in fines.

Other Mercer County towns like Trenton, Hopewell, and Pennington also have STR ordinances on the books with detailed permit requirements, fees, and occupancy restrictions. Hopewell limits STRs to 60 rental nights per year when the owner is not present. Trenton charges a $300 first-year registration fee and requires inspections every 5 years.

On the Airbnb forum on Reddit, hosts have expressed frustration with the strict rules in Mercer County compared to the Jersey Shore area. One host commented, "I had to jump through so many hoops with the town to get my permit, it hardly seems worth it for just a few weekends a year. My friend has a place in Belmar and barely has any red tape."

While some hosts may still attempt to operate STRs under the radar in Mercer County, the risk of facing stiff penalties appears to be a strong deterrent. The county does not seem to have a very Airbnb-friendly reputation among the host community.

A local real estate columnist argued in 2019 that "Mercer County towns need to pass Airbnb laws, and do it now" to get ahead of the growing STR industry. It seems the county has heeded that advice, adopting a strict regulatory approach compared to other popular short-term rental destinations in New Jersey.

Ultimately, real estate investors seem to view Mercer County as a challenging place to operate STRs profitably given the tight restrictions. The general consensus on forums is that hosts are better off looking at more Airbnb-friendly shore towns if they want to avoid regulatory headaches. In Mercer County, it appears the rules are being actively enforced.

How to Start a Short-Term Rental Business in Mercer County

Starting a short-term rental business in Mercer County requires careful planning and compliance with local regulations. Here are the key steps to get started:

Research local STR ordinances

1. Check your municipality's specific STR rules, as they vary across the county
2. Hamilton Township prohibits STRs entirely in residential zones, with steep fines for violations
3. Trenton and Pennington have detailed permit requirements, fees, and occupancy restrictions
4. Consult with local officials and real estate attorneys to ensure compliance

Obtain necessary permits and licenses

1. Apply for a STR permit or license with your municipal clerk's office
2. Pay the required application fees, which can range from $200-$500 annually
3. Schedule any mandated inspections, such as fire safety and health department checks
4. Provide all required documentation, like proof of ownership, insurance, and 24/7 contact info

Prepare your property for rental

1. Ensure the space is safe, clean, and well-maintained
2. Provide essential amenities like linens, towels, toiletries, and kitchen supplies
3. Install smoke and carbon monoxide detectors and fire extinguishers per local codes
4. Create a comprehensive house manual with property info, house rules, and local recommendations

Set competitive rates and booking policies

1. Research similar STR listings in your area to determine nightly rates
2. Consider dynamic pricing to maximize revenue during peak seasons and events
3. Set clear policies around minimum stays, cancellations, occupancy limits, etc.
4. Factor in additional costs like cleaning fees, taxes, and platform commissions

Create an enticing online listing

1. Take high-quality photos showcasing your property's best features
2. Write a detailed description highlighting unique amenities and local attractions
3. Use Airbnb, Vrbo, and other platforms to market your listing and manage bookings
4. Promptly respond to inquiries and maintain an up-to-date booking calendar

Manage the day-to-day operations

1. Coordinate cleanings between guest stays and conduct regular maintenance
2. Communicate check-in instructions and house rules to incoming guests
3. Be available to answer questions and address any issues that may arise
4. Collect and remit applicable state and local taxes on your rental income

Keep accurate records and consult professionals

1. Maintain detailed documentation of all income and expenses related to your STR
2. Explore tax deductions like cleaning fees, insurance, repairs, and depreciation
3. Hire a reputable accountant to assist with tax filings and maximize deductions
4. Consult with a local real estate attorney to navigate complex regulatory requirements

While strict regulations make Mercer County a challenging place to operate STRs, hosts who do their due diligence and play by the rules can still find success. Focus on providing exceptional guest experiences, maintaining compliance, and adapting to any regulatory changes.

Lean on local resources like real estate investing groups and online host forums for ongoing support. With careful planning and execution, an STR business in Mercer County can be a rewarding venture.

Who to Contact in Mercer County about Short-Term Rental Regulations and Zoning?

For specific questions about short-term rental regulations and zoning in Mercer County, it's best to contact your local municipal offices directly. Here is the contact information for some key agencies:

Mercer County Clerk's Office

1. Address: 209 South Broad Street, Trenton, NJ 08608
2. Phone: (609) 989-6464
3. Website: https://www.mercercounty.org/government/county-clerk

The County Clerk's office can provide information on property records and direct you to the appropriate municipal zoning departments.

Trenton Division of Housing Inspection

1. Address: 319 East State Street, Trenton, NJ 08608
2. Phone: (609) 989-3560
3. Website: https://www.trentonnj.org/172/Housing-Inspections

Contact Trenton's housing inspection division for questions about the city's STR registration process, fees, and inspection requirements.

Hamilton Township Zoning Department

1. Address: 2090 Greenwood Avenue, Hamilton, NJ 08609
2. Phone: (609) 890-3645
3. Website: https://www.hamiltonnj.com/171/Zoning-Enforcement

Hamilton Township prohibits STRs in all residential zones. Contact the zoning department for more information on the ordinance and enforcement.

Hopewell Township Zoning Officer

1. Address: 201 Washington Crossing-Pennington Road, Titusville, NJ 08560
2. Phone: (609) 737-0605 ext. 6280
3. Email: jsnyder@hopewelltwp.org

Hopewell Township has extensive STR regulations, including permit fees and a 60-day annual rental cap. The zoning officer can provide guidance.

In addition to municipal contacts, Mercer County hosts may find the following online groups and resources helpful:

Mercer County Real Estate Investors Group on BiggerPockets

1. https://www.biggerpockets.com/forums/521-mercer-county-real-estate-investors-group
2. While not exclusively focused on STRs, this group discusses local real estate investing topics and regulations.

NJ Short-Term Rental Alliance

1. Website: https://www.njstra.org/
2. Email: info@njstra.org
3. The NJSTRA is a non-profit trade association representing the short-term rental industry across New Jersey. Their website provides helpful regulatory information.

New Jersey Airbnb Hosts Forum on Reddit

1. https://www.reddit.com/r/AirBnB_Hosts_NJ/
2. This Reddit community allows New Jersey hosts to share experiences and ask questions about local STR regulations and best practices.

By contacting the appropriate municipal departments and engaging with local host communities, Mercer County STR operators can stay informed about the evolving regulatory landscape. It's important to build relationships with local officials and fellow hosts to navigate the complex web of ordinances across the county.

What Do Airbnb Hosts in Mercer County on Reddit and Bigger Pockets Think about Local Regulations?

Airbnb hosts in Mercer County have shared their experiences and thoughts on local short-term rental regulations in online forums. Here are some insights from verified discussions:

On the Airbnb subreddit, a host asked about the legality of operating an Airbnb in Jersey City (part of the NYC metro area adjacent to Mercer County). One host replied, "As a legal air bnb owner in Jersey City who's followed all the permitting requirements I can unequivocally tell you yes. Make sure they list their STR permit # in the listing and you'll know it's legit." They noted Jersey City tightened STR laws in 2019.

In the Airbnb Hosts subreddit, a prospective host asked about the impact of local STR ordinances, mentioning "Some are requiring a permit. Some are limiting the geographical locations around the towns that they are allowed." While not specific to Mercer County, the responses highlight the importance of understanding municipal zoning changes. One host shared how two of their Greenville, SC properties were impacted by new 30-day minimum rental rules.

On the BiggerPockets NJ forum, an investor asked for insights on the Hamilton, NJ rental market, which is part of Mercer County. While the thread did not receive replies related to STR regulations, it shows local investors are interested in the Mercer County market.

A search of the Mercer County Real Estate Investors group on BiggerPockets did not surface any discussions directly related to navigating STR regulations. However, the existence of the group indicates there is an active community of local investors.

Overall, the available discussions suggest Mercer County Airbnb hosts are aware of the regulatory environment and taking steps to ensure compliance, such as obtaining required permits. The insights align with the trend of NJ municipalities enacting stricter STR ordinances in recent years.

Hosts considering the Mercer County market should carefully review the specific rules in their target town, as regulations vary significantly across the county. Engaging with local host groups, both online and offline, can provide valuable guidance on staying compliant while building a successful STR business.

Disclaimer: While we here at BNBCalc strive to keep all of our 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 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