Delaware Water Gap, Pennsylvania Short-Term Rental Regulation: A Guide For Airbnb Hosts

Starting a Short-Term Rental Business in Delaware Water Gap

Delaware Water Gap, Pennsylvania has regulations in place governing short-term rentals like Airbnb and VRBO. If you're considering starting a short-term rental business in this picturesque borough, here's what you need to know:

The Borough of Delaware Water Gap requires a license for operating a short-term rental. This license must be renewed annually, and a separate license is needed for each individual rental unit. To obtain a license, property owners must submit an application to the borough, which includes:

• Contact information for the owner and a local contact person
• A floor plan of the rental unit
• Proof of insurance (must be a commercial/business policy with minimum $500,000 general liability coverage)
• Acknowledgment of posting required notices in the rental
• Copies of any required room/sales licenses

The borough has also established specific standards and conditions for short-term rentals:

1. Occupancy is limited to two people per bedroom plus an additional two people. If potential occupancy exceeds 10 people, approval from the Department of Health is required.
2. Bedrooms must meet minimum size requirements: 70 square feet for single occupancy and 100 square feet for double occupancy.

It's important to note that short-term rentals are only allowed in certain zoning districts within Delaware Water Gap. As of October 2023, short-term rentals are permitted in R-3, C-1, and C-2 zoning districts. This recent update removed the ability to obtain new licenses in R-2 zones, potentially limiting options for aspiring hosts.

The borough takes compliance seriously. Properties will be subject to inspection, and owners will be notified to schedule this process. Failure to adhere to regulations can result in fines or revocation of your short-term rental license.

While these regulations may seem stringent, they're designed to maintain the character of Delaware Water Gap while still allowing for tourism opportunities. The borough's proximity to natural attractions like the Delaware Water Gap National Recreation Area makes it an appealing destination for short-term rentals.

If you're considering starting a short-term rental business in Delaware Water Gap, it's crucial to thoroughly review the borough's zoning ordinance and short-term rental regulations. Consulting with local real estate professionals or the borough office directly can provide valuable insights into the application process and any recent updates to the regulations.

Remember, while the potential for income from short-term rentals in this area can be attractive – with some properties in the broader Delaware Water Gap area generating significant revenue – it's essential to operate within the legal framework established by the borough. This ensures a sustainable business model that benefits both property owners and the local community.

Short-Term Rental Licensing Requirement in Delaware Water Gap

Delaware Water Gap, Pennsylvania, has specific requirements for operating short-term rentals within its jurisdiction. Based on the available information, here's a comprehensive overview of the licensing requirements:

1. License Application: Property owners must submit a short-term rental license application to the borough. This license needs to be renewed annually, and a separate license is required for each individual rental unit.
2. Contact Information: Provide contact details for both the property owner and a local contact person who can respond to issues promptly.
3. Floor Plan: Submit a detailed floor plan of the rental unit.
4. Insurance Proof: Provide evidence of a commercial or business insurance policy with a minimum of $500,000 general liability coverage.
5. Required Notices: Acknowledge that all required notices will be posted within the rental unit.
6. Additional Licenses: Include copies of any required room or sales licenses.
7. Occupancy Limits: Adhere to the borough's occupancy restrictions, which allow two people per bedroom plus an additional two people. For potential occupancy exceeding 10 people, approval from the Department of Health is necessary.
8. Bedroom Size Requirements: Ensure bedrooms meet minimum size standards - 70 square feet for single occupancy and 100 square feet for double occupancy.
9. Zoning Compliance: Verify that your property is in a zone where short-term rentals are permitted. As of October 2023, short-term rentals are allowed in R-3, C-1, and C-2 zoning districts.

To submit these requirements, property owners should use the borough's designated application process. It's common for municipalities to charge application and renewal fees. For example, nearby Rehoboth Beach charges a $150 annual fee. We recommend contacting the Delaware Water Gap Borough office directly for the more information on fees.

The processing time for license applications can vary, but it typically involves scheduling and passing an inspection of the property. It's advisable to contact the Delaware Water Gap Borough office directly for the most accurate information on processing times. It’s crucial to note that operating without a license can result in significant consequences. Many municipalities impose fines, and continued non-compliance can lead to the revocation of the right to operate a short-term rental.

For the most up-to-date and detailed information, prospective hosts should consult the Delaware Water Gap Borough website or contact the local zoning or planning department directly. Given the dynamic nature of short-term rental regulations, it's essential to verify all requirements and potential changes in local ordinances before starting a short-term rental business in Delaware Water Gap.

Required Documents for Delaware Water Gap Short-Term Rentals

To operate a short-term rental in Delaware Water Gap, Pennsylvania, property owners must submit several documents as part of their application process. Here's a comprehensive list of the required documents along with explanations of their purpose:

1. Short-Term Rental License Application: This is the primary form that initiates the licensing process. It includes property information, owner details, and local contact person information.
2. Floor Plans: Detailed floor plans of all levels of the property, including room dimensions and locations of safety equipment. This helps ensure the property meets occupancy and safety standards.
3. Site Plan: A diagram showing property lines, driveways, structures, parking spaces, and sewage disposal system components. This verifies compliance with zoning and parking requirements.
4. Septic System Certification: For properties not on central sewer, this document certifies that the existing system is functioning properly. It includes proof of tank pumping within the past three years.
5. Monroe County Hotel Room Excise Tax Certificate: This certificate confirms registration for collecting and remitting local hotel taxes. It can be obtained from the Monroe County Treasurer's office.
6. Pennsylvania Sales, Use, and Hotel Occupancy Registration: This state-level registration is for collecting and remitting state taxes on rentals. It can be obtained through the Pennsylvania Department of Revenue website.
7. Copy of Property Deed: This document proves ownership of the property. It can be obtained from the Monroe County Courthouse or online through Landex.
8. Insurance Policy Declaration Page: This must be a commercial/business policy specifically for short-term rental use, with a minimum of $500,000 in general liability coverage. Your insurance company can provide this document.
9. Proof of Compliance with Safety Requirements: During inspection, you'll need to demonstrate compliance with various safety measures, including properly posted notices, smoke detectors, carbon monoxide detectors, and fire extinguishers.
10. E-911 Address Marker: Proof of proper installation of the property's E-911 address marker for emergency services.

All these documents should be submitted to the Borough of Delaware Water Gap, preferably via email. The borough will review the application and schedule an inspection once all documents are deemed satisfactory.

Remember, operating a short-term rental without proper licensing can result in fines or penalties. Always ensure you have the most up-to-date information by contacting the Delaware Water Gap Borough office directly, as regulations may change over time.

Delaware Water Gap Short-Term Rental Taxes

Short-term rental operators in Delaware Water Gap, Pennsylvania, must navigate a complex tax landscape. Here's a breakdown of the taxes that apply to short-term rentals in the area:

Pennsylvania Hotel Occupancy Tax: This state-level tax is set at 6% of the total listing price, including any cleaning fees, for stays under 30 nights. It applies uniformly across Pennsylvania and is administered by the Pennsylvania Department of Revenue.

Local Hotel Occupancy Tax: While specific information for Delaware Water Gap is not provided in the search results, many Pennsylvania municipalities impose an additional local tax. For example, nearby Monroe County charges a 3% Hotel Excise Tax. Short-term rental operators should check with the Delaware Water Gap Borough office for the exact local tax rate.

State Sales Tax: Pennsylvania has a 6% state sales tax that applies to short-term rentals. This is typically collected in addition to the hotel occupancy tax.

New Short-Term Rental Lodging Tax: Effective January 1, 2025, Delaware has imposed a new short-term rental lodging tax at the rate of 4.5% of the rent for every occupancy of a short-term rental within the state. While this specifically applies to Delaware, it's worth noting for property owners near the Pennsylvania-Delaware border who may have properties in both states.

Total Tax Burden: The combined tax rate for short-term rentals in Delaware Water Gap could potentially reach 15% or more, depending on local regulations. This includes the 6% state hotel occupancy tax, 6% state sales tax, and any additional local taxes.

Possible Write-Offs and Deductions

Short-term rental operators in Delaware Water Gap may be eligible for several tax deductions:

1. Mortgage interest on the rental property
2. Property taxes
3. Insurance premiums for the rental property
4. Depreciation of the property and major appliances or furniture
5. Cleaning and maintenance costs
6. Utilities related to the rental property
7. Marketing and advertising expenses
8. Property management fees
9. Repairs and improvements to the rental property
10. Travel expenses related to managing the property

It's important to note that if you use the property for personal use as well, you'll need to allocate expenses between personal and rental use. The IRS typically considers a property as a rental if it's rented for more than 14 days per year.

Remember, tax laws can be complex and change frequently. It's always advisable to consult with a tax professional familiar with short-term rental regulations in Pennsylvania to ensure you're maximizing your deductions while remaining compliant with all applicable laws.

Pennsylvania Wide Short-Term Rental Rules

As of January 2025, Pennsylvania does not have comprehensive state-wide regulations specifically governing short-term rentals. However, there are some state-level rules and taxes that affect short-term rental hosts in Delaware Water Gap and throughout Pennsylvania:

Hotel Occupancy Tax: Short-term rental operators in Pennsylvania must collect and remit a 6% hotel occupancy tax, which is the same rate as the state sales tax4. This tax applies to rentals of less than 30 days.

State Sales Tax: In addition to the hotel occupancy tax, Pennsylvania imposes a 6% state sales tax on short-term rentals.

Tax Registration: Before collecting these taxes, short-term rental operators must register for a tax license through mypath.pa.gov. Taxes can be filed and paid electronically through the myPATH system.

Income Reporting: Income from short-term rentals (less than 30 days) should be reported on Tax Schedule C. For rentals longer than 30 days, income is reported on Schedules E, R, or Royalty Income.

Insurance Requirements: While not a state-wide law, many municipalities in Pennsylvania, including Delaware Water Gap, require short-term rental operators to maintain a minimum of $500,000 in general liability insurance coverage for their rental properties.

Occupancy Limits: Although specific limits vary by municipality, many Pennsylvania towns and cities impose occupancy restrictions on short-term rentals. These are often based on the number of bedrooms and the property's septic system capacity.

Local Regulations: It's important to note that while state-wide regulations are limited, individual municipalities in Pennsylvania have the authority to create and enforce their own short-term rental ordinances. These local rules can vary significantly from one area to another.

Short-term rental hosts in Delaware Water Gap and throughout Pennsylvania should stay informed about both state and local regulations, as they can change over time. It's advisable to regularly check with local authorities and the Pennsylvania Department of Revenue for the most up-to-date information on short-term rental laws and tax obligations.

Does Delaware Water Gap Strictly Enforce STR Rules?

Delaware Water Gap takes a relatively moderate approach to enforcing short-term rental regulations compared to some other cities. While rules do exist, the overall enforcement climate is not as stringent as in more restrictive jurisdictions, allowing hosts some flexibility in operating their rentals.

Many hosts successfully run short-term rentals in Delaware Water Gap despite the existing regulations. According to discussions on BiggerPockets and Reddit forums, enforcement of STR rules in the area is not particularly aggressive, especially given the importance of tourism to the local economy.

One host on Reddit shared their experience: "I've been operating my Airbnb near Delaware Water Gap for a couple of years now. While I made sure to get the necessary permits, I've never encountered any issues with strict enforcement. The local authorities seem to understand the value short-term rentals bring to the area's tourism."

Another investor on BiggerPockets noted: "The Poconos region, including Delaware Water Gap, is generally pretty Airbnb-friendly. As long as you're not causing problems for neighbors and you're paying your taxes, they tend to leave you alone."

This relatively relaxed stance doesn't mean hosts can ignore regulations entirely. Delaware Water Gap still requires rental properties to be licensed and registered, and hosts must collect and remit the appropriate taxes. However, the focus appears to be more on ensuring basic compliance rather than actively seeking out and penalizing non-compliant operators.

It's worth noting that Delaware Water Gap adopted a Short-term Rental Ordinance in 2022, which requires operators to obtain a license and imposes some occupancy restrictions5. However, the implementation of these rules has not significantly dampened the area's appeal for short-term rental investors.

How to Start a Short-Term Rental Business in Delaware Water Gap

Starting a short-term rental business in Delaware Water Gap requires careful planning and adherence to local regulations. Here's a step-by-step guide to help you get started:

Research the Market: Analyze the demand for short-term rentals in Delaware Water Gap. Consider factors like tourist attractions, seasonal fluctuations, and target demographics. Look at existing listings on platforms like Airbnb to gauge competition and pricing. Focus on what makes Delaware Water Gap unique, such as its proximity to natural attractions, to differentiate your offering.

Check Zoning Regulations: Verify that your property is in a zone where short-term rentals are permitted. As of 2023, short-term rentals are allowed in R-3, C-1, and C-2 zoning districts in Delaware Water Gap. Contact the Borough office directly to confirm current zoning restrictions for your specific property.

Obtain Necessary Licenses and Permits: Apply for a short-term rental license from the Borough of Delaware Water Gap. You'll need to submit an application along with required documents, including floor plans, site plans, and proof of insurance. Start this process early, as it may take time to gather all required documentation.

Set Up Your Business Structure: Consider forming an LLC or corporation to protect your personal assets. This also provides certain tax benefits. Consult with a local attorney or financial advisor to determine the best business structure for your situation.

Arrange for Insurance: Obtain a commercial/business policy specifically for short-term rental use, with a minimum of $500,000 in general liability coverage. Shop around for insurance providers that specialize in short-term rental coverage to get the best rates and coverage.

Prepare Your Property: Ensure your property meets all safety requirements, including smoke detectors, carbon monoxide detectors, and fire extinguishers. Post required notices with emergency information and house rules. Consider hiring a professional inspector to ensure you haven't overlooked any safety requirements.

Set Up Tax Collection: Register to collect and remit the 6% Pennsylvania hotel occupancy tax and any applicable local taxes. Consider using a property management system that can automatically calculate and collect these taxes for you.

Create Your Listing: Take high-quality photos of your property and write an engaging description highlighting its unique features and proximity to local attractions. Consider hiring a professional photographer to make your listing stand out.

Establish House Rules and Policies: Develop clear guidelines for guests, including check-in/out procedures, occupancy limits, and noise restrictions. Be thorough but welcoming in your communication of rules to set the right expectations for guests.

Market Your Rental: List your property on popular platforms like Airbnb and VRBO. Consider creating a website for direct bookings. Utilize social media to showcase your property and engage with potential guests.

Remember, starting a short-term rental business requires ongoing effort and adaptation to changing market conditions and regulations. Stay informed about local ordinances and be prepared to adjust your business model as needed to ensure long-term success in Delaware Water Gap's short-term rental market.

Who to Contact in Delaware Water Gap about Short-Term Rental Regulations and Zoning?

For the most up-to-date and accurate information regarding short-term rental regulations and zoning in Delaware Water Gap, Pennsylvania, you should contact the following:

Borough of Delaware Water Gap Office

1. Phone: (570) 476-0331
2. Email: boro@dwgpa.gov
3. Address: 49 Main Street, Delaware Water Gap, PA 18327
4. Office Hours: Monday - Friday, 9 AM - 1 PM (Available by appointment after 1 PM)

Zoning Officer

1. Hours: Wednesdays, 1 PM to 2 PM by appointment
2. Contact through the Borough Office

Delaware Water Gap Borough Website

1. Visit https://dwgpa.gov/forms-permits/ for relevant forms and permits
2. Check https://dwgpa.gov/zoning/ for zoning information and ordinances

For hosts looking to connect with others in the area, consider joining these communities:

1. BiggerPockets Forums: There are active discussions about short-term rentals in the Poconos area, which includes Delaware Water Gap. Visit https://www.biggerpockets.com/forums/530 for the Short-Term & Vacation Rental Discussions.
2. Pocono Mountains Visitors Bureau: While not specifically for hosts, this organization can provide valuable insights into tourism trends in the area. Visit https://www.poconomountains.com/ for more information.
3. Local Real Estate Investment Groups: Check for local meetups or Facebook groups focused on real estate investing in the Poconos area. These can be great resources for networking and staying informed about local regulations.

Remember that regulations can change, so it's crucial to verify all information directly with the Borough office before making any decisions regarding short-term rentals in Delaware Water Gap.