Memphis Short Term Rental Regulation: A Guide For Airbnb Hosts

Do you own a place in Memphis and you're weighing whether to put it on Airbnb or Vrbo? Well, the good news is that Tennessee and the City of Memphis both let you rent out a whole house or condo short-term, not just a spare room, which already puts you ahead of hosts in cities like New York or Honolulu. You'll need a permit to do it legally, and Memphis, sitting in Shelby County, Tennessee, operates under both a state preemption law and a local ordinance that shape exactly how that permit works.

Here's the catch, and it's a big one for 2026: the Memphis City Council recently discovered that roughly 90% of the city's short-term rentals are operating without that permit. A run of shootings and unruly party rentals in late 2025 and early 2026 pushed the Council to order a real enforcement push, with a report due back within 90 days on tightening the rules further. Whatever you read about Memphis STR rules from 2023 or 2024, treat this year as the one where the city actually started checking.

So let's walk through what it actually takes to do this properly in 2026: what the ordinance requires, what the permit costs, the five layers of tax stacked on a Memphis stay, how seriously the city is now enforcing all of it, and who to call when you get stuck. Every figure below comes from the ordinance itself, Tennessee's Department of Revenue, or the city's own filings, and where I couldn't pin something down to an official source, I've said so plainly. Run the numbers through BNBCalc before you commit to a property here.

What are Short Term Rental (Airbnb, VRBO) Regulations in Memphis, Tennessee?

Two layers of law govern a Memphis short-term rental, and they don't always move at the same speed. The bottom layer is state law: Tennessee's Short-Term Rental Unit Act, Public Chapter 972 of 2018, codified at T.C.A. §§ 13-7-601 through 606 and effective since May 17, 2018. Our Tennessee statewide guide covers how that same state law plays out in other Tennessee cities, since Memphis is just one application of it. It's a preemption statute, meaning it stops Memphis (or any Tennessee city) from banning short-term rentals outright. A city can still require a reasonable permit process, enforce its ordinary zoning, health and safety codes, and shut down a specific rental after three or more violations, once the owner has exhausted their appeals. What it cannot do is single out short-term rentals for a blanket prohibition.

The top layer is Memphis's own ordinance, generally cited as Chapter 5-44 of the Code of Ordinances, adopted in 2023 with a compliance deadline of July 1 of that year. It defines a short-term rental as a residential dwelling unit or a detached accessory dwelling unit with no more than four sleeping rooms, rented to transient guests for fewer than 30 continuous days. Bed and breakfasts, hotels and motels aren't covered by this definition, and neither is a unit rented to the same person for 30 days or longer. A short-term rental is permitted as an accessory use in every zoning district that allows residential use at all, provided the unit carries a valid permit.

One wrinkle worth knowing up front: Memphis and Shelby County run STR registration through the same joint agency, the Division of Planning and Development, on the shared Develop901 portal. Even so, the permit itself is a separate legal instrument depending on where your property sits. Inside Memphis city limits, you're under Chapter 5-44 and the city's fee schedule. In unincorporated Shelby County, outside the city, you're under the county's own ordinance and its own application. If your property is technically in the unincorporated county rather than Memphis proper, our Shelby County guide covers that separate process in detail, since the fees and the office you deal with genuinely differ.

Starting a Short Term Rental Business in Memphis

Since the state framework blocks an outright ban and Memphis's own ordinance treats short-term rentals as a normal accessory use, this is a real business here, not a workaround. That's a meaningfully different starting point than a lot of the country's biggest STR markets, where the whole-unit model is illegal and only a hosted room-share survives.

Eligibility itself is fairly wide open. Any residential dwelling unit, or a detached accessory dwelling unit with no more than four sleeping rooms, can become a permitted short-term rental in any zoning district that allows residential use. You don't have to live on site, which again separates Memphis from hosted-only cities. What you do need is a designated Short Term Rental Agent: a natural person at least 21 years old who's reasonably available to handle problems. That person has to be able to appear at the property within two hours of a city notification about noise, disorder or a code violation, and they have to accept service of violation notices on the owner's behalf. The owner can serve as their own Agent if they hold or reside within 25 miles of the property; otherwise, someone else has to take that role.

Owning more than one short-term rental means applying for a separate permit for each one, and if a single dwelling contains more than one short-term rental unit, each of those gets treated as its own unit requiring its own permit. Keep in mind that a lease, condo bylaws or an HOA's own rules can still restrict or ban short-term rentals entirely: Tennessee's preemption law explicitly leaves that private layer alone, so the state protecting your right against the city doesn't touch what your own HOA says.

Short Term Rental Licensing Requirement in Memphis

Given the ordinance clears a path for the business itself, the actual permit is where the paperwork starts. Applicants file annually, under oath, on a form specified by the city, and the ordinance text sets a non-refundable application fee of $75, with a $50 renewal fee due before the 365-day permit expires. I should flag something honestly here: several industry sites currently quote a much higher fee, $300 to apply and $150 to renew. I wasn't able to reach the final codified fee schedule to settle which number is current, since Municode's Memphis chapter blocks automated access and a related county ordinance document I tried to open turned out to be an unreadable scanned file. Do check the exact current fee directly with the Permits Office or the Develop901 portal before you budget for this, because that's not a gap worth guessing on.

Whatever the fee turns out to be, the permit itself doesn't transfer between owners, entities or addresses, and it has to be renewed every 365 days rather than running for years the way some cities allow. The application asks for the owner's contact information, the Short Term Rental Agent's 24-hour contact details, the maximum number of occupants you're proposing, and a sworn acknowledgment that you've received and understood the ordinance. Applicants who've had a similar permit denied, suspended or revoked anywhere in the prior 180 days are ineligible, and so is anyone with unpaid civil penalties tied to this ordinance.

Review has to follow due process, and the city can only deny an application if you fail to meet the ordinance's conditions or can't demonstrate the ability to comply with local, state or federal law. If you are denied, the ordinance sets up a dedicated Short Term Rental Appeals Board, five members split between hosts, hotel-industry representatives and a private citizen, appointed by the mayor and confirmed by Council. You get 30 days to file a written appeal with the Permit Office, and from there, a final board decision can go to chancery court on a writ of certiorari within 60 days.

Required Documents for Memphis Short Term Rentals

Since a denial costs you time as well as the application fee, it's worth gathering everything before you file rather than after. Memphis asks for:

• A sworn Code Compliance Verification Form, a document you execute certifying the unit meets applicable building, health and life-safety code provisions. You can't legally occupy or rent the unit if it's in violation of any of those.
• Proof of current ownership of the property.
• Proof of hazard and liability insurance, with liability coverage of at least $1,000,000.
• The owner's sworn acknowledgment that they've received, read and understood the ordinance.
• Your Short Term Rental Agent's full contact information, including a phone number they'll actually answer around the clock.
• The maximum occupant count you intend to allow, disclosed on the application itself.

Beyond the paperwork the ordinance lists, do check your own lease, HOA covenants or condo bylaws before you apply. State law leaves those private restrictions fully intact, so a technically valid city permit won't save you from a building rule that already bans short-term use. And remember that a "Code Compliance Verification Form" is a sworn statement, not a formality. Misrepresenting anything on the application is itself grounds for denial or revocation.

Memphis Short Term Rental Taxes

Assuming you get through licensing and are able to start hosting, there's still a layered tax picture to work through. Memphis stacks five separate charges on a short-term stay, split between three different governments, so it's worth taking them one row at a time.

Charge	Rate	Collected by
State sales tax	7%	Tennessee Department of Revenue
Local sales tax (Memphis)	2.75%	Tennessee Department of Revenue
City hotel/motel occupancy tax	4.0%	City of Memphis Treasury Office
Shelby County room occupancy tax	5%	Shelby County Clerk
Destination marketing assessment	$2.00 per occupied room-night	City of Memphis

The 7% state rate applies to every short-term rental stay under 90 continuous days, and Memphis's own 2.75% local sales tax sits at the state-allowed maximum, effective since January 2020. Together that's 9.75% before you even reach the occupancy layer.

The city's hotel/motel occupancy tax currently runs 4.0%, up from 3.5% after the Council voted in April 2025 to raise it to the state maximum, largely to help fund the FedExForum renovation. On top of that, Shelby County levies its own 5% room occupancy tax under a 1969 private act, administered separately by the County Clerk's office. And the ordinance itself layers on a flat $2 per occupied room-night destination marketing assessment, dedicated to tourism promotion.

Who actually collects all of this depends on how you're booked. Airbnb has a voluntary collection agreement with the city and remits the city occupancy tax and the $2 assessment on your behalf. Vrbo, from what I can tell, hasn't had the same arrangement, which means a host relying on Vrbo or direct bookings needs to file and remit those two charges monthly. That return goes through the city's own Hotel/Motel Occupancy Tax form, due the 20th of each month, with a 2% credit for early payment and stiff penalties, 10% annual interest plus 1% per month, if you're late.

State sales tax and the state-administered local occupancy tax work differently: any marketplace facilitator over $100,000 in Tennessee sales, which both Airbnb and Vrbo clear easily, collects and remits those automatically. You're only on the hook there if you book a stay entirely outside a platform.

Two more taxes only bite once you're running a real volume. Tennessee's business tax applies once your gross short-term rental sales in Memphis and Shelby County pass $100,000 in a year, at which point you register as a Classification 3 taxpayer in both jurisdictions. And franchise and excise tax only touches you if you've put the property into an LLC or corporation, since individuals renting in their own name are exempt from that one entirely. Keep in mind that your rental income is still ordinary taxable income at the federal and state level regardless of any of this, and the usual deductions apply. If you're weighing a Memphis property against a different Tennessee market with a lighter tax stack, BNBCalc Markets breaks that comparison out at the neighborhood level.

Memphis-wide Short Term Rental Rules

Next to that tax stack, the ordinance's day-to-day operating rules are still comparatively straightforward. Every permitted unit needs a 5-pound ABC-rated fire extinguisher, UL 217-compliant smoke alarms in every sleeping area and along the path of egress out of the sleeping unit, and carbon monoxide detectors on every habitable floor. The permit holder has to post the Short Term Rental Agent's name and phone number conspicuously inside the unit, and that person genuinely does need to answer calls 24 hours a day, seven days a week, for the duration of every stay.

A few rules are more specific to Memphis than you might expect. The ordinance intentionally exempts short-term rentals from food-service inspection, on the condition that any food or drink provided to guests is packaged, sealed and non-perishable. The principal renter has to be at least 18. You can't legally rent a unit for less than 24 hours under any circumstance, no matter what a guest offers to pay. And every advertisement, listing or description of the rental, on any platform, has to display the permit number, matching what you told the city when you applied. Noise complaints run through Memphis City Code §22-1, and garbage and debris fall under Ordinance No. 4840, both of which apply to your guests just as they'd apply to a permanent resident. The ordinance also bars discrimination against guests based on any class protected under the Tennessee Human Rights Act.

Does Memphis Strictly Enforce STR Rules? Is Memphis Airbnb Friendly?

Historically, not very, and that's precisely what changed in 2026. When the Council reviewed the program in March, staff reported that roughly 90% of Memphis short-term rentals were operating with no permit at all. That number landed against a backdrop of real violence: a fatal shooting at an East Memphis rental party in December 2025, four people shot including a 14-year-old at a High Point Terrace rental in January 2026, and another fatal shooting at a Sherwood Forest rental on Valentine's Day 2026. Councilman Philip Spinosa Jr., whose district absorbed several of these incidents, put it bluntly: "Seven of them were shootings, two deaths... I'm sick of this."

Council responded with Resolution 22426, adopted with a favorable committee recommendation on March 3, 2026, directing the Mayor's Administration to partner with an outside organization, in this case the crime-prevention nonprofit SafeWays, to strengthen monitoring and enforcement. The Administration has 90 days from adoption to report back with recommendations, proposed partnerships and, if the data supports it, actual amendments to Chapter 5-44. SafeWays' compliance manager described the approach as identifying unpermitted addresses and then monitoring "just about any type of calls from the city" tied to that property going forward.

There's a real constraint on how fast any of this can move, though. Tennessee's state preemption law still requires three separate violations, with all appeals exhausted, before the city can shut down a specific rental, and it grandfathers rentals that were already operating before local regulation existed, unless the property sells, sits unused for 30 consecutive months, or racks up those three violations. So don't expect an instant purge of every unpermitted listing. What you should expect is meaningfully more active complaint-driven enforcement, run through Memphis 311, and a real chance the fee schedule, inspection process or violation rules look different again by the time your renewal comes around. Civil penalties currently run up to $50 per day per violation, and three code violations on one property within 12 months triggers a 12-month freeze on new applications for that address.

Put plainly, Memphis remains one of the more Airbnb-friendly big cities in the country in terms of what's legally permitted: whole-unit rentals, no owner-occupancy requirement, and a state law that keeps the city from banning the business outright. What's changed is that showing up unpermitted and hoping nobody notices, which is what roughly nine in ten operators appear to have been doing, is no longer a safe bet in 2026.

How to Start a Short Term Rental Business in Memphis

Given how much of that enforcement risk rides on being properly permitted, the order below is worth following rather than skipping ahead on.

1. Confirm your property sits inside Memphis city limits, not unincorporated Shelby County, since the ordinance, fee and portal differ between the two.
2. Check your lease, HOA rules or condo bylaws for any short-term rental restriction, since state law doesn't override those.
3. Line up $1,000,000 in hazard and liability insurance and confirm current ownership documentation.
4. Designate your Short Term Rental Agent, either yourself if you're within 25 miles, or someone who genuinely can respond within two hours, any hour.
5. Complete the sworn Code Compliance Verification Form and clear any open building, health or life-safety violations first.
6. Apply through the Develop901 portal, pay the application fee, and confirm the exact current amount with the Permits Office rather than relying on an old figure.
7. Install the required smoke alarms, CO detectors and fire extinguisher, and post your Agent's contact information inside the unit.
8. Publish your permit number in every listing the moment it's issued, on every platform you use.
9. Register for sales tax collection through TNTAP if you're taking any bookings outside a marketplace facilitator, and confirm which taxes your platform already collects for you.
10. Diarize your 365-day renewal date, and track any code violations against the three-strike rule that can freeze the address for a year.

Who to Contact in Memphis About Short Term Rental Regulations and Zoning?

Whichever step trips you up, a handful of offices handle nearly everything between them.

Permits and STR registration. The City's Division of Planning and Development runs registration jointly with Shelby County through the Develop901 portal.

• Registration portal: Develop901 STR page
• Memphis Permits Office: 2714 Union Ave Ext., Suite 100, Memphis, TN 38112
• Phone: 901-636-6711
• Email: [email protected]
• Hours: Monday to Friday, 8:30 a.m. to 4:00 p.m.

Complaints about a rental. Memphis 311 routes short-term rental complaints, from noise to suspected unpermitted operation, to the right city office.

• Dial 311 from within Memphis
• Online: memphistn.gov's 311 request system

City occupancy tax. The City of Memphis Treasury Office administers the hotel/motel occupancy tax return and the destination marketing assessment.

• Address: 125 North Main, Room 301, Memphis, TN 38103
• Filing is monthly, due the 20th, through the same Hotel/Motel Occupancy Tax return

County occupancy tax and county-only STR permits. The Shelby County Clerk's Office handles the county's own room occupancy tax and the separate permit required in unincorporated Shelby County.

• Address: 150 Washington Ave, Suite 200, Memphis, TN 38103
• Business Tax Division: (901) 222-3059
• General line: (901) 222-3000

State sales tax and business tax registration. The Tennessee Department of Revenue administers sales tax, the state-collected portion of local occupancy tax, and business tax registration statewide.

• Register and file through TNTAP

What Do Airbnb Hosts in Memphis Think About Local Regulations?

Given everything above, it's worth knowing how hosts on the ground actually talk about this market, since that's a different question from what the ordinance says on paper. On BiggerPockets, one recurring theme in 2025 and 2026 is Shelby County's property reappraisal, which pushed valuations up an average of 34% across the county and even higher in some suburbs. Investor and property manager Andrew Glisson walked through the practical effect: short-term rental operators can reprice nightly to absorb a higher tax bill, while long-term landlords are stuck until their lease renews, so the tax increase "comes straight out of cash flow" for them instead. His advice to anyone underwriting a new purchase is blunt: use the 2025 assessed value, not an outdated one, since the appeal window has closed and the new valuations hold until 2029.

A separate thread from an investor relocating to Memphis asked which neighborhoods to target, and the answers are a useful map of where hosts see opportunity: Vollintine Evergreen, Binghampton and Crosstown for affordability with good access to visitor draws, High Point Terrace, Waynoka and Chickasaw for location without the saturation of Cooper-Young or downtown. Broker Cherie Ganesh's reply is worth repeating in full, because it's the single most practical line in the thread: research recent local ordinances and permit requirements before you buy, not after. High Point Terrace is exactly the kind of neighborhood that thread recommended, and it's also where one of the shootings that triggered this year's crackdown took place, which is a reminder that a good rental market and a well-run rental are two different things.

The overall read from hosts, from what I can tell, is that Memphis remains genuinely attractive on the numbers: entry prices are low relative to national averages, and the yield on a well-run whole-unit rental still compares favorably. What's shifted is the margin for error. A market that quietly tolerated 90% non-compliance for years is not the same market once the Council starts actually checking, and 2026 is the year that gap closed.

Frequently Asked Questions

Can you legally run an Airbnb in Memphis in 2026?

Yes. Memphis allows whole-unit short-term rentals in any residential zoning district, provided the owner holds a permit under Chapter 5-44 of the City Code. Tennessee's state preemption law bars the city from banning short-term rentals outright, though local safety, occupancy and permitting rules still apply. Enforcement has tightened sharply in 2026 after the Council found that roughly 90% of operating rentals lacked a permit, so treat a permit as a real requirement, not a formality.

How much does a Memphis short-term rental permit cost?

The ordinance text sets a $75 non-refundable application fee and a $50 annual renewal fee, though some current industry sources cite $300 and $150 instead. That discrepancy couldn't be resolved against a readable, fully current official fee schedule, so confirm the exact amount with the Permits Office (901-636-6711) or the Develop901 portal before applying. The permit runs for 365 days and cannot be transferred between owners or addresses.

Do you have to collect taxes on a Memphis Airbnb?

Yes, and there are five layers: 7% state sales tax, 2.75% Memphis local sales tax, a 4.0% city hotel/motel occupancy tax, a 5% Shelby County room occupancy tax, and a flat $2 per-night destination marketing assessment. Airbnb generally collects the city occupancy tax and the $2 fee on your behalf under its agreement with the city; hosts using Vrbo or direct bookings typically need to file those two themselves monthly, while state sales tax is collected automatically by any qualifying marketplace facilitator.

What happens if you operate a Memphis short-term rental without a permit?

The ordinance allows an administrative penalty of up to $50 per day per violation, and three violations at one property within 12 months blocks new applications for that address for a full year. Because roughly 90% of Memphis rentals were found to be unpermitted in March 2026, the Council ordered a partnership with a compliance-monitoring nonprofit and a 90-day report on possible ordinance changes, so expect real complaint-driven enforcement through Memphis 311 rather than the historically light oversight of past years.

Can an HOA or landlord still ban short-term rentals in Memphis even though the city allows them?

Yes. Tennessee's Short-Term Rental Unit Act protects owners from a citywide ban, but it explicitly leaves private restrictions intact: condo associations, HOAs and lease agreements can still prohibit short-term rentals through their own governing documents. Do check your lease, bylaws or covenants before applying for a city permit, since a valid permit from Memphis won't override a rule your own building already has in place.

Last verified: July 2026. Every ordinance, tax rate, state law, and contact detail in this guide links to or comes from its official source.