A short-term rental in Austin is the rental of a housing unit, or part of one, for fewer than 30 consecutive days. It does not matter whether it is a whole house, a garage apartment or a single room, and it does not matter how often it is rented. One night without a license is a violation.
Austin issues three types of operating license. Type 1 is owner-occupied, Type 2 is not, and Type 3 covers units in multifamily and condominium buildings. Until 2025 a Type 2 license carried density caps and zoning restrictions that made it difficult to obtain in much of the city. Those are gone. Short-term rentals are now an accessory use to all residential uses in every zoning district, provided the property holds a valid license.
Short-term rental licenses are held by people. An operator counts as an individual when the property is owned by one or more individuals, by a trust where every trustee and beneficiary is a natural person, or by a limited liability company where every member is a natural person. A company owned by another company does not qualify.
This matters because the limits on how many properties one operator can run apply to the individual, not the entity. Splitting properties across separate LLCs does not reset the count.
Applications go through Austin Development Services, online through Austin Finance Online, in person at the Permitting and Development Center, or by mail. Two things that used to be required no longer are: a Certificate of Occupancy and proof of insurance were both dropped in October 2025.
Licenses run for two years rather than one, a change made in October 2025. They cannot be transferred and do not convey when a property is sold, so a buyer applies from scratch and waits out the processing time. Renewals can be submitted 60 days before expiry.
There is one point worth more attention than it usually gets. A license valid on 30 September 2025 counts as existing, and when it is renewed the operator is not subject to the new eligibility rules. That protection survives only as long as the license does. Let it lapse, and the property is treated as a new application under the current rules.
On a site with three or fewer housing units, one operator may run up to two short-term rentals. More than that means separate sites, at least 1,000 feet apart.
Larger sites work differently. On a site with four or more housing units, an operator is capped at the greater of one unit or 10% of the units they own there. If the site also has a commercial use, that rises to 25%.
Every licensed short-term rental must have a designated local contact, and the requirement is stricter than most owners expect. The contact must be an individual living within the five-county Austin metro area: Travis, Williamson, Hays, Bastrop or Caldwell County. They must be authorized to make decisions about the property and its guests, and to act on emergency conditions.
Within two hours of being contacted about an emergency, they have to respond. If a City employee asks, they have to be at the property within two hours. Failure to respond within that window is grounds for revoking the license.
Two taxes apply to a short-term stay in Austin: the city's at 11% and the state's at 6%, for a combined 17%. Since April 2025 booking platforms have been required to collect and remit the city's portion on an owner's behalf, which has led a lot of owners to assume they have nothing to do. They still have to file. A quarterly report to the City is required regardless of whether a platform paid the tax, and a zero report is required for a quarter with no bookings.
Hotel occupancy tax, explainedNoise is where most complaints start, and the rules tighten at 10pm. Before then, amplified sound has to stay under 75 decibels at the property line. After 10pm it can't be audible beyond the property line at all.
Every licensed property also has to display its license, and guests have to be told where the fire extinguisher is.
Enforcement is complaint-driven and runs through Austin 3-1-1 and Code Compliance. The city's own findings note that 94% of STR-related calls involve an unlicensed property, which is most of the reason the 2025 ordinance exists.
The part with real consequences for a licensed owner is the platform requirement. Platforms must display a license number on every listing, must remove a listing within 10 days of a delist notice from the city, and may not accept a booking fee for an unlicensed property at all. That provision is in force and enforcement is expected to begin in earnest, though the city has not confirmed a firm date.
For the houses we manage, we help with the license application and its renewals, and we serve as the local contact. Calculating and filing hotel occupancy tax is available as an optional service.