Memphis, Tennessee

Short-term rentals are permitted in Memphis, but a Short-Term Rental Property Permit is required for any residential dwelling or accessory unit rented to transient guests for fewer than 30 consecutive days. The framework was substantially updated by Ordinance No. 5631, effective July 1, 2023. The permit costs $300, is non-refundable, renews annually and expires 365 days after issuance. It is non-transferable, and grandfathered status no longer transfers on sale, so new owners must apply under current rules.

Applicants must provide a site plan, proof of ownership, proof of at least $1,000,000 in liability insurance, property tax certification and a final code enforcement inspection. A responsible party within about 50 miles must be reachable around the clock. Smoke alarms, carbon monoxide detectors and a fire extinguisher are required.

Occupancy is capped at two people per bedroom plus two additional guests, and properties are limited to roughly three to four sleeping rooms. Memphis does not require owner occupancy or primary residence, and there is no annual cap on nights rented. This allows investor-owned properties, unlike some other Tennessee cities.

Zoning allows STR use in most residential and commercial districts under the Unified Development Code. Properties rezoned from residential to commercial face a wait of about 18 months before becoming permit-eligible. Verify district eligibility with the Memphis Planning Department before buying.

Operators collect lodging taxes, including a 3.5% city short-term rental tax and a 5% Shelby County occupancy tax, plus a $2 per bedroom per night charge. Combined with sales taxes, the guest tax burden is roughly 18.75%. Operating without a permit carries a fine of $50 per day per unit. Enforcement is rated moderate.