Mexico City Short-Term Rental Regulation: A Guide For Airbnb Hosts

What are Short-Term Rental (Airbnb, VRBO) Regulations in Mexico City, Mexico?

Mexico City has seen tremendous growth in short-term rentals through platforms like Airbnb and VRBO in recent years. However, new regulations have been implemented that hosts must follow to operate a vacation rental business legally. Here is an overview of the key rules for short-term rentals in Mexico City.

Starting a Short-Term Rental Business in Mexico City

To legally rent out your property short-term in Mexico City, you must first register as a host in the city's new Host Registry. This registration is valid for two years and must be renewed 30 days before expiration.

Each property you list must also be registered separately and will receive a unique registration number and certificate. This registration number must be included on any short-term rental booking platform listings for that property.

There are limits on how many properties an individual host can register. Hosts must meet additional requirements starting with the fourth property, including obtaining a merchant establishment key and operating permit.

Hosts must ensure their properties meet all safety requirements per current risk management and civil protection regulations. They must also report occupancy data and comply with local lodging taxes.

The new regulations aim to address issues associated with the rapid growth of short-term rentals in Mexico City, such as gentrification and rising housing costs. Similar rules have been implemented in other major tourist cities worldwide to balance the interests of visitors and local residents.

Failure to comply with the registration and reporting requirements can result in fines and penalties. Working with an experienced short-term rental management company can help navigate the complexities of the new regulations.

Despite the added rules, the short-term rental market in Mexico City is expected to remain strong. The city is a top global destination known for its culture, cuisine, and climate. Savvy investors can still find lucrative opportunities in the market with proper planning and regulatory compliance.

Short-Term Rental Licensing Requirement in Mexico City

Hosts must obtain a license to legally operate as part of the new regulations for short-term rentals in Mexico City. This licensing process is integrated into the mandatory host registration system.

When registering as a host in the new Host Registry, individuals and legal entities offering short-term tourist stays will automatically apply for an operating license simultaneously. The license will be valid for two years and must be renewed at least 30 days before expiration.

Each property listed by a host must also be registered separately and will receive its unique registration number and certificate. This registration number must be displayed on any short-term rental platform listing for that property.

There are limits on how many properties a single host can register and license. Hosts must meet additional requirements starting with the fourth property, including obtaining a merchant establishment key and operating permit.

Failure to obtain the proper licensing or comply with the registration requirements can result in properties being removed from the Host Registry. Hosts may also face fines and penalties for operating without a valid license.

The licensing requirement is part of Mexico City's efforts to regulate the rapid growth of short-term rentals and mitigate negative impacts on local housing markets and communities. By making hosts register and obtain licenses, the city aims to better monitor and control short-term rental activity.

Other major tourist destinations around the world, such as Barcelona, Paris, and New York, have implemented similar licensing systems for short-term rentals in recent years. The trend reflects growing concerns about the effects of Airbnb and other platforms on residential neighborhoods.

While the licensing process does add an administrative burden for hosts, it is a necessary step to operate legally in Mexico City's evolving regulatory environment. Hosts should factor in the time and costs associated with licensing when evaluating the feasibility and profitability of short-term rentals.

Properly licensed and registered properties will have a competitive advantage as the city ramps up enforcement against illegal rentals. Hosts who make the effort to comply with the new rules will be well-positioned to succeed in Mexico City's dynamic and growing short-term rental market.

Required Documents for Mexico City Short-Term Rentals

When registering your short-term rental property with the Mexico City government, you must provide several documents to verify your eligibility and comply with the new regulations. The specific requirements may vary depending on whether you are an individual host or a legal entity.

For individual hosts, the required documents include:

• Official identification, such as a passport or voter ID card (INE).
• Proof of address, which can be a recent utility bill or bank statement showing your name and the address of the short-term rental property.
• Proof of property ownership or legal right to use the property for short-term rentals, such as a title deed or rental agreement.
• A signed declaration form states that the property meets all safety and quality standards the city sets.
• Provide proof of social responsibility insurance for each property to cover potential risks related to the provision of short-term rental services.

Legal entities, such as companies or organizations, must provide additional documentation:

1. Articles of incorporation and proof of legal representation.
2. Tax identification number (RFC).
3. Proof of business address.
4. A signed declaration form stating that all properties meet safety and quality standards.
5. Proof of social responsibility insurance for each property.

If you are registering multiple properties, you must provide the required documents for each individual property. Starting with the fourth property, hosts must also obtain a merchant establishment key and an operating permit from the Electronic System of Notices and Permits for Commercial Establishments.

It's important to ensure that all submitted documents are clear, legible, and valid. Providing false or misleading information can result in fines, penalties, and the revocation of your short-term rental registration.

If any of the details about your short-term rental property change, such as ownership or insurance coverage, you must update your registration with the city within 30 days. This may require submitting new supporting documents.

Gathering and organizing the required documents is a critical step in the short-term rental registration process in Mexico City. You can avoid delays or issues with your application by clearly understanding what is needed and ensuring your paperwork is in order.

If you have questions about the specific documents required for your situation, you can reach out to the Mexico City Tourism Ministry for guidance. They can be contacted by phone at 55 5286 0100 or by email at sedetur@cdmx.gob.mx.

By carefully reviewing and complying with the documentation requirements, you can demonstrate your commitment to operating your short-term rental legally and responsibly in Mexico City. This will help ensure your business's long-term sustainability and success in this dynamic and growing market.

Mexico City Short-Term Rental Taxes

In addition to the registration and licensing requirements, short-term rental hosts in Mexico City are subject to various taxes. Understanding and complying with these tax obligations is crucial for operating legally and avoiding penalties.

The primary tax that applies to short-term rentals in Mexico City is the Lodging Services Tax, also known as the Occupancy Tax. This tax ranges from 3% to 5% of the total listing price, including any cleaning fees, depending on the type of property.

For example, if a guest books a short-term rental in Mexico City for $1,000 (including cleaning fees), they can expect to pay an additional $30 to $50 in Lodging Services Tax. This tax is collected by the host and remitted to the Mexico City Ministry of Finance (Secretaría de Finanzas de la Ciudad de México).

Hosts are responsible for registering with the Ministry of Finance and obtaining a tax identification number (RFC) to properly report and pay the Lodging Services Tax. They must file monthly tax returns and make payments by the 15th day of the following month.

In addition to the Lodging Services Tax, short-term rental income is subject to federal taxes, including Value Added Tax (VAT) and Income Tax (ISR). VAT is a consumption tax that applies to most goods and services in Mexico, including short-term rentals, at a rate of 16%.

Income Tax applies to the profits earned from short-term rental activities. Hosts must report their rental income on their annual tax return and pay the corresponding Income Tax based on their tax bracket.

To simplify tax compliance for hosts, some short-term rental platforms, like Airbnb, have agreements with the Mexico City government to automatically collect and remit certain taxes on behalf of their users. For example, Airbnb collects the 3-5% Lodging Services Tax and the 16% VAT from guests at the time of booking and pays these taxes directly to the relevant authorities.

However, hosts are still responsible for reporting their rental income and paying Income Tax separately. It's recommended to consult with a local tax professional to ensure full compliance with all applicable tax laws.

Failure to comply with tax obligations can result in fines, penalties, and legal consequences. The Mexico City government has been increasing its enforcement efforts to crack down on tax evasion in the short-term rental sector.

In 2021, Airbnb reported collecting and remitting over $2 million in Lodging Services Tax to the Mexico City government since the tax agreement was implemented in 2017. This revenue has helped bolster the city's finances and support local public services.

As the short-term rental market continues to grow in Mexico City, it's essential for hosts to stay informed about their tax responsibilities and to maintain accurate records of their rental income and expenses. Hosts can confidently operate their businesses by complying with the tax regulations and contributing to the city's economic development.

Mexico Wide Short-Term Rental Rules

While Mexico City has its own specific regulations for short-term rentals, some national laws and guidelines apply throughout Mexico. These country-wide rules aim to promote tourism, protect consumers, and ensure fair competition in the lodging industry.

One important national law that affects short-term rentals is the Federal Tourism Law (Ley Federal de Turismo). This law establishes the general framework for tourism activities in Mexico and sets standards for the quality and safety of tourist services, including accommodations.

Under the Federal Tourism Law, all providers of tourist services, including short-term rental hosts, must register with the National Tourism Registry (Registro Nacional de Turismo). This registration is separate from Mexico City's and other municipalities' local requirements.

To register with the National Tourism Registry, hosts must provide their personal information, details about their rental property, and proof of compliance with local regulations. They must also agree to abide by the standards and obligations set forth in the Federal Tourism Law.

Another national law that applies to short-term rentals is the Federal Consumer Protection Law (Ley Federal de Protección al Consumidor). This law establishes the rights of consumers and the obligations of providers in commercial transactions, including online bookings.

Under the Federal Consumer Protection Law, short-term rental hosts must provide accurate and truthful information about their properties and services. They must also respect the terms and conditions of the booking agreement and provide a safe and hygienic environment for guests.

Hosts who violate the Federal Consumer Protection Law can face fines, penalties, and legal action from the Federal Consumer Protection Agency (PROFECO). Guests who experience problems with their short-term rental can file complaints with PROFECO for assistance.

In addition to these national laws, there are also some general tax rules that apply to short-term rentals throughout Mexico. As mentioned in the previous section, hosts are generally required to pay the Lodging Services Tax, Value Added Tax (VAT), and Income Tax on their rental income.

The specific tax rates and reporting requirements may vary depending on the state and municipality where the rental property is located. Hosts should consult with a local tax professional to ensure compliance with all applicable tax laws.

It's important to note that many states and municipalities in Mexico have their own specific regulations for short-term rentals, similar to Mexico City. These local rules may include registration requirements, zoning restrictions, and safety standards.

Before starting a short-term rental business in any part of Mexico, hosts should research and comply with all relevant national and local regulations. Failure to do so can result in fines, penalties, and legal consequences.

By understanding and following the Mexico-wide rules for short-term rentals, hosts can operate their businesses with confidence and contribute to the growth of the country's tourism industry. With clear and consistent regulations, Mexico can continue attracting visitors worldwide while ensuring a fair and safe experience for all.

Mexico Wide Short-Term Rental Rules

While Mexico City has its specific short-term rentals regulations, some national laws and guidelines apply throughout Mexico. These country-wide rules aim to promote tourism, protect consumers, and ensure fair competition in the lodging industry.

One important national law that affects short-term rentals is the Federal Tourism Law (Ley Federal de Turismo). This law establishes the general framework for tourism activities in Mexico and sets standards for the quality and safety of tourist services, including accommodations.

Under the Federal Tourism Law, all providers of tourist services, including short-term rental hosts, must register with the National Tourism Registry (Registro Nacional de Turismo). This registration is separate from Mexico City's and other municipalities' local requirements.

To register with the National Tourism Registry, hosts must provide their personal information, details about their rental property, and proof of compliance with local regulations. They must also agree to abide by the standards and obligations set forth in the Federal Tourism Law.

Another national law that applies to short-term rentals is the Federal Consumer Protection Law (Ley Federal de Protección al Consumidor). This law establishes the rights of consumers and the obligations of providers in commercial transactions, including online bookings.

Under the Federal Consumer Protection Law, short-term rental hosts must provide accurate and truthful information about their properties and services. They must also respect the booking agreement's terms and conditions and provide guests a safe and hygienic environment.

Hosts who violate the Federal Consumer Protection Law can face fines, penalties, and legal action from the Federal Consumer Protection Agency (PROFECO). Guests who experience problems with their short-term rental can file complaints with PROFECO for assistance.

In addition to these national laws, there are also some general tax rules that apply to short-term rentals throughout Mexico. As mentioned in the previous section, hosts are generally required to pay the Lodging Services Tax, Value Added Tax (VAT), and Income Tax on their rental income.

The specific tax rates and reporting requirements may vary depending on the state and municipality where the rental property is located. Hosts should consult with a local tax professional to ensure compliance with all applicable tax laws.

It's important to note that many states and municipalities in Mexico have their own specific regulations for short-term rentals, similar to Mexico City. These local rules may include registration requirements, zoning restrictions, and safety standards.

Before starting a short-term rental business in any part of Mexico, hosts should research and comply with all relevant national and local regulations. Failure to do so can result in fines, penalties, and legal consequences.

By understanding and following the Mexico-wide rules for short-term rentals, hosts can operate their businesses with confidence and contribute to the growth of the country's tourism industry. With clear and consistent regulations, Mexico can continue attracting visitors worldwide while ensuring a fair and safe experience for all.

Does Mexico City Strictly Enforce STR Rules?

Mexico City has implemented a comprehensive set of regulations for short-term rentals, but the level of enforcement has been a topic of debate among hosts and industry experts. While the city has taken steps to monitor and penalize non-compliant listings, some hosts continue to operate without fully adhering to the rules.

According to discussions on forums like Bigger Pockets and Reddit, enforcement of short-term rental regulations in Mexico City has been inconsistent. Some hosts report receiving fines and notices for failing to register their properties or comply with other requirements, while others claim to have operated under the radar without consequences.

One Bigger Pockets user shared their experience of being fined $500 for listing an unregistered property on Airbnb. They warned other hosts to take the registration process seriously and not to assume that the city won't catch on to illegal listings.

However, another Reddit user commented that they had been operating an unregistered short-term rental in Mexico City for over a year without any issues. They suggested that the city's enforcement efforts were more focused on large-scale operators with multiple listings than on individual hosts.

Compared to other major cities in Latin America, Mexico City is generally considered to be relatively friendly towards short-term rentals. While cities like Buenos Aires and Rio de Janeiro have implemented strict bans or restrictions on Airbnb and similar platforms, Mexico City has taken a more permissive approach.

The city's regulations are designed to balance the interests of hosts, guests, and local residents, rather than to eliminate short-term rentals altogether. By requiring registration, setting limits on the number of listings per host, and imposing safety and quality standards, the city aims to promote responsible and sustainable growth of the short-term rental market.

However, this relatively permissive stance does not mean that hosts can operate with impunity. The city has been ramping up its enforcement efforts in recent years, with a focus on identifying and penalizing unregistered listings.

In 2019, the Mexico City government announced that it had removed over 2,000 illegal short-term rental listings from platforms like Airbnb and Booking.com. The city has also been conducting inspections of properties suspected of violating the regulations, with fines ranging from $500 to $5,000 for non-compliance.

Despite these enforcement efforts, some hosts continue to operate outside of the law. The anonymity and ease of listing properties online make it difficult for the city to identify and shut down every illegal rental.

However, the consensus among experienced Bigger Pockets and Reddit hosts is that the risks of operating an unregistered short-term rental in Mexico City are not worth the potential rewards. With the city's increasing focus on enforcement and the potential for hefty fines, hosts who fail to comply with the regulations are risking their businesses and reputations.

In conclusion, while Mexico City is relatively Airbnb-friendly compared to other major cities, it does take its short-term rental regulations seriously. Enforcement may not be perfect, but hosts who operate illegally are taking a significant risk. The best approach for hosts is to fully understand and comply with all applicable rules and regulations to operate legally and sustainably in this dynamic and growing market.

How to Start a Short-Term Rental Business in Mexico City

Starting a short-term rental business in Mexico City can be a lucrative venture, but it requires careful planning and compliance with local regulations. Here are the key steps to get your short-term rental business up and running in Mexico City:

1. Research the market and regulations: Before investing in a short-term rental property, conduct thorough research on the local market conditions, demand drivers, and competition. Familiarize yourself with Mexico City's specific regulations for short-term rentals, including registration requirements, zoning restrictions, and tax obligations.
2. Choose a suitable property: Look for a property that meets the city's requirements for short-term rentals, such as being located in a permitted zone and meeting safety and quality standards. Consider factors like location, size, amenities, and target audience when selecting a property.
3. Register as a host: Register as a host in Mexico City's Host Registry, which is valid for two years and must be renewed 30 days before expiration. Provide the required personal and property information, and pay the registration fee.
4. Register each property: Register each individual property you plan to list as a short-term rental. Each property will receive a unique registration number and certificate, which must be displayed on any online listings.
5. Obtain necessary permits and insurance: Depending on the number and type of properties you plan to operate, you may need to obtain additional permits, such as a merchant establishment key and operating permit. Secure social responsibility insurance for each property to cover potential risks.
6. Set up your listings:Create attractive and informative listings for your short-term rental properties on popular platforms like Airbnb and VRBO. Include high-quality photos, detailed descriptions, and the required registration number for each property.
7. Establish pricing and policies: Develop a competitive pricing strategy that takes into account factors like seasonality, demand, and operating costs. Set clear policies for bookings, cancellations, check-in/check-out, and house rules.
8. Manage bookings and guest communication: Use a reliable system to manage bookings, inquiries, and guest communication. Respond promptly to messages and provide excellent customer service to ensure positive reviews and repeat business.
9. Comply with tax obligations: Register with the Mexico City Ministry of Finance and obtain a tax identification number (RFC) to report and pay the required taxes, including the Lodging Services Tax, Value Added Tax (VAT), and Income Tax.
10. Maintain and improve your properties: Regularly maintain and upgrade your short-term rental properties to ensure they meet guest expectations and comply with city standards. Invest in quality furnishings, amenities, and guest experiences to stand out in the competitive market.

By following these steps and staying informed about any changes to the regulations, you can build a successful and compliant short-term rental business in Mexico City. It's recommended to seek the advice of local legal and tax professionals to ensure you are operating in full compliance with all applicable laws and regulations.

With the right strategy and execution, a short-term rental business in Mexico City can provide a steady stream of income and the opportunity to showcase the city's vibrant culture and hospitality to guests from around the world. As the market continues to evolve, staying adaptable and focused on providing exceptional guest experiences will be key to long-term success.

Who to Contact in Mexico City about Short-Term Rental Regulations and Zoning?

If you have questions or concerns about short-term rental regulations and zoning in Mexico City, there are several key government agencies and resources available to assist you.

The Ministry of Tourism (Secretaría de Turismo or SECTUR) is the primary agency regulating short-term rentals in Mexico City. SECTUR oversees the registration process for hosts and properties, enforces compliance with the city's short-term rental regulations, and promotes the development of the tourism industry.

To contact SECTUR about short-term rental regulations, you can:

Call their main office at +52 (55) 5345-3000
Email them at contacto@sectur.cdmx.gob.mx
Visit their website at https://www.turismo.cdmx.gob.mx/ for more information and resources

For questions related to zoning and land use, you can reach out to the Ministry of Urban Development and Housing (Secretaría de Desarrollo Urbano y Vivienda or SEDUVI). SEDUVI is responsible for regulating land use, issuing building permits, and ensuring compliance with the city's zoning laws.

To contact SEDUVI, you can:

Call their main office at +52 (55) 5130-2100
Email them at contacto@seduvi.cdmx.gob.mx
Visit their website at https://www.seduvi.cdmx.gob.mx/ for more information and resources

If you need assistance with tax registration and compliance, the Ministry of Finance (Secretaría de Finanzas or SEFIN) is the agency to contact. SEFIN is responsible for collecting the Lodging Services Tax and other taxes related to short-term rentals, and can provide guidance on tax registration and reporting requirements.

To contact SEFIN, you can:

Call their main office at +52 (55) 5134-0770
Email them at contacto@finanzas.cdmx.gob.mx
Visit their website at https://www.finanzas.cdmx.gob.mx/ for more information and resources

In addition to these government agencies, several industry associations and resources can provide valuable support and information for short-term rental hosts in Mexico City.

The Mexican Association of Holiday Rental Professionals (Asociación Mexicana de Profesionales de Renta Vacacional or AMPRV) is a non-profit organization representing the interests of Mexico's short-term rental industry. AMPRV offers educational resources, networking opportunities, and advocacy efforts to support the growth and professionalism of the industry.

To contact AMPRV, you can:

Email them at info@amprv.org
Visit their website at https://www.amprv.org/ for more information and resources

The National Association of Real Estate Professionals (Asociación Nacional de Profesionales Inmobiliarios or ANPI) is another industry group that can provide guidance and support for short-term rental hosts. ANPI offers training, certification, and networking opportunities for real estate professionals in Mexico, including those involved in the short-term rental market.

To contact ANPI, you can:

Call their main office at +52 (55) 5514-7799
Email them at contacto@anpi.org.mx
Visit their website at https://www.anpi.org.mx/ for more information and resources

By reaching out to these government agencies and industry groups, you can get the information and support you need to navigate the complex landscape of short-term rental regulations and zoning in Mexico City. Whether you are a new or experienced host, these resources can help you operate your business legally, ethically, and successfully in this dynamic and growing market.

What Do Airbnb Hosts in Mexico City on Reddit and Bigger Pockets Think about Local Regulations?

Mexico City's short-term rental regulations have been a hot topic of discussion among Airbnb hosts on popular online forums like Reddit and Bigger Pockets. Many hosts have shared their experiences, opinions, and advice for navigating the city's evolving regulatory landscape.

Here are a few notable examples of what Mexico City Airbnb hosts are saying on these platforms:

Reddit user "DF_Host" on the r/MexicoCity subreddit:

In a thread titled "Airbnb Regulations in CDMX," DF_Host shares their perspective as a long-time host in Mexico City. They mention that while the registration process can be time-consuming and bureaucratic, it's important to comply with the rules to avoid fines and maintain good standing with the city. However, they also note that enforcement has been inconsistent, with some unregistered listings continuing to operate without consequences.

Bigger Pockets user "InvestorMX" on the International Real Estate Investing forum:

InvestorMX, an experienced real estate investor with multiple short-term rental properties in Mexico City, offers a more critical take on the regulations. They argue that the registration requirements and occupancy limits unfairly restrict property owners' rights and hinder the growth of the short-term rental market. They also express concerns about the lack of clarity and communication from the city government regarding the rules and their implementation.

Reddit user "Anfitriona_CDMX" on the r/AirbnbHosts subreddit:

In a post titled "Navigating Mexico City's Short-Term Rental Laws," Anfitriona_CDMX shares their experience successfully registering their properties and complying with the regulations. They emphasize the importance of staying informed about any changes to the laws and working with local professionals, such as lawyers and accountants, to ensure full compliance. They also highlight the benefits of being a registered host, such as increased credibility with guests and access to city resources and support.

Bigger Pockets user "NomadInvestor" on the Nomad Real Estate Investing forum:

NomadInvestor, a digital nomad and short-term rental operator in various cities including Mexico City, offers a more optimistic view of the regulations. They suggest that the rules, while imperfect, are a necessary step towards professionalizing the short-term rental industry and ensuring a level playing field for all participants. They also point out that Mexico City's regulations are relatively lenient compared to some other major cities, and that opportunities still exist for savvy investors who can adapt to the changing landscape.

Overall, the sentiment among Mexico City Airbnb hosts on Reddit and Bigger Pockets is mixed. While some express frustration with the complexity and inconsistency of the regulations, others see them as a necessary evil to legitimize and sustain the short-term rental market in the long run.

A common theme is the importance of staying informed, connected, and compliant in order to succeed as a short-term rental operator in Mexico City. Hosts recommend joining local host groups, attending city workshops and events, and seeking professional advice when needed.

As the short-term rental landscape continues to evolve in Mexico City and around the world, it's clear that hosts will need to remain adaptable and engaged to thrive in this dynamic and often challenging industry. By learning from each other's experiences and insights on platforms like Reddit and Bigger Pockets, Airbnb hosts can navigate the complexities of local regulations and build successful, sustainable businesses in the heart of Mexico.

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.