Lincoln Short Term Rental Regulation: A Guide For Airbnb Hosts

What are short term rental (Airbnb, VRBO) regulations in Lincoln Nebraska?

Short-term rentals (STRs) like Airbnb and Vrbo have become increasingly popular in Lincoln, Nebraska in recent years. However, operating an STR comes with specific regulations and requirements that hosts must follow. This comprehensive guide covers everything you need to know about short-term rental rules in Lincoln, from licensing to taxes and zoning restrictions.

Starting a Short Term Rental Business in Lincoln

As of June 2021, the City of Lincoln has implemented regulations for operating short-term rentals within city limits. These rules involve obtaining a short-term rental license through the Building and Safety Department1. Before applying for a license, it's crucial to review Lincoln's STR ordinances to ensure your property is eligible.Key considerations include:

• Zoning restrictions - STRs are allowed in most areas but may be prohibited or limited in certain residential zones
• Occupancy limits based on the unit's size
• Compliance with building safety codes
• Adequate parking for guests

Once you've confirmed your property meets the requirements, gather all necessary documentation for the license application. This typically includes proof of ownership, a floor plan of the rental unit, and agreement to comply with occupancy limits and safety standards1.

Short Term Rental Licensing Requirement in Lincoln

All short-term rental operators in Lincoln must acquire a license, which costs $250 per rental unit and must be renewed annually. Each STR unit requires a separate license12.

To apply, submit the completed application along with the fee to the Building and Safety Department. Licenses are typically processed within 30 days. Once approved, you'll receive your STR license certificate to post prominently in the rental unit.

It's important to note that operating an unlicensed short-term rental in Lincoln can result in fines and legal action. The city has contracted with a third-party company to identify and monitor unlicensed STRs2.

Required Documents for Lincoln Short Term Rentals

When applying for your short-term rental license, you'll need to provide several documents, including12:

• Completed STR license application
• Proof of ownership or landlord approval
• Floorplan of the rental unit with room dimensions
• Parking plan showing dedicated off-street parking spaces
• Proof of liability insurance ($500,000 minimum)
• Signed affidavit agreeing to comply with all STR rules and regulations

You may also need to provide additional documentation, such as a tax ID number, depending on your specific circumstances. The Building and Safety Department can guide you on exact requirements for your property.

Lincoln Short Term Rental Taxes

Just like hotels and B&Bs, short-term rentals in Lincoln are subject to lodging taxes. Hosts must collect these taxes from guests and remit them to the proper authorities3.

As of 2023, the tax rates for STRs in Lincoln are:

• 5.5% state sales tax
• 1.5% city sales tax
• 1% state lodging tax
• 4% county lodging tax

This amounts to a total tax rate of 12% on short-term rentals. For example, if your nightly rate is $100, you would collect $112 from the guest and remit $12 in taxes.Failure to properly collect and pay taxes can result in fines, penalties, and even legal action.

It's critical to maintain organized records and file lodging tax returns on time, typically each month.Many STR platforms like Airbnb and Vrbo offer to collect and remit taxes on behalf of hosts. However, it's ultimately the host's responsibility to ensure taxes are paid, so be sure to review your platform's policies and confirm they're collecting the correct amount3.

Lincoln-wide Short Term Rental Rules

In addition to licensing and tax requirements, Lincoln has several citywide rules for short-term rentals2. These include:

• Occupancy limits based on the number and size of bedrooms
• Restrictions on events, parties, and large gatherings
• Quiet hours between 10pm-7am
• Compliance with parking requirements
• Posting the STR license, contact info, and rules inside the unit
• Maintaining the property in a safe, clean, and orderly condition

Low-density residential zones have additional restrictions, including a 5-year sunset clause on STR licenses. After 5 years, no new licenses will be issued in these areas to phase out short-term rentals and preserve neighborhood character2.

Does Lincoln strictly enforce STR rules?

Based on discussions in real estate investing forums, Lincoln appears to be taking a fairly strict approach to regulating short-term rentals compared to some other cities45. The city has contracted with a third-party company to identify unlicensed rentals and issue violations.

The 5-year sunset clause for STRs in certain residential areas also indicates the city is placing limits on Airbnb-style rentals to address concerns about neighborhood impacts2. Some investors express frustration with these restrictions making it harder to operate STRs5.

However, demand for short-term rentals in Lincoln remains strong, driven by events like Husker football games and the annual state fair4. Many hosts continue to operate licensed STRs, focusing on areas with fewer zoning restrictions.

Compared to other cities, Lincoln falls somewhere in the middle in terms of STR friendliness. It's not an outright ban, but there are notable limitations and licensing requirements to navigate. Ultimately, hosts must weigh the potential revenue against the costs of compliance and possibility of future rule changes.

How to Start a Short Term Rental Business in Lincoln

• If you're ready to launch an STR in Lincoln, follow these key steps:
• Research zoning and license requirements for your specific property
• Prepare the unit to meet all safety and occupancy standards
• Obtain necessary documentation like proof of ownership and insurance
• Apply for the short-term rental license and pay initial $250 fee
• Determine your nightly rates based on market analysis and revenue goals
• Create a system to manage bookings, guest communication, and cleaning
• List your property on platforms like Airbnb and Vrbo
• Collect lodging taxes from guests and remit to proper authorities
• Maintain detailed records of income, expenses, and tax filings
• Comply with all Lincoln STR rules and renew license annually

With careful planning and attention to regulations, an STR can be a profitable venture in Lincoln. The key is to stay informed of any rule changes and adapt your strategy accordingly.

Who to contact in Lincoln about Short Term Rental Regulations and Zoning?

If you have questions about Lincoln's short-term rental regulations, your first point of contact should be the Building and Safety Department. They handle all STR licensing and can advise on zoning restrictions for specific properties.

Building and Safety Department
555 S 10th St, Suite 203
Lincoln, NE 68508
Phone: 402-441-7521
Web: https://www.lincoln.ne.gov/City/Departments/Building-Safety

For concerns about problem STRs or neighborhood impacts, contact the city's dedicated short-term rental hotline:

STR Complaint Hotline
Phone: 402-441-STR1 (7871)
Web: https://www.lincoln.ne.gov/City/Departments/Building-Safety/Short-Term-Rentals/Complaints

This 24/7 hotline allows neighbors to report issues like noise, parking, or over-occupancy at STRs. The city will follow up on complaints and issue violations if warranted.

Finally, consult the Lincoln-Lancaster County Planning Department for any questions about zoning districts and land use regulations that may impact STRs:

Lincoln-Lancaster County Planning Department
555 S 10th St, Suite 213
Lincoln, NE 68508
Phone: 402-441-7491
Web: https://www.lincoln.ne.gov/City/Departments/Planning-Department

What do Airbnb hosts in Lincoln on Reddit and Bigger Pockets think about local regulations?

On real estate investing forums like Bigger Pockets and Reddit, Lincoln STR hosts express a mix of frustration and acceptance regarding the city's short-term rental regulations.

Some feel the licensing requirements and zoning restrictions are overly burdensome:"

Lincoln's proposed ordinance #523 will change my use from a lawful one to an unlawful one, and not permit me to continue the use, contrary to ORS 215.130(5)." (Bigger Pockets)5"

Instead of applying the new standard prospectively, the Ordinance will violate state law by taking away existing lawful uses." (Bigger Pockets)5Others argue the rules are necessary to preserve neighborhood character and housing availability:"

I am all for firmer rules and penalties to owners if they don't remedy issues ASAP." (Reddit)4"Any new regulations should protect, not restrict, property rights and ability to share your home and supplement income." (Reddit)4Most agree that operating a successful STR in Lincoln requires carefully navigating the regulations and being a responsible host.

Advice often includes:

• Thoroughly research license requirements and zoning before buying an STR property
• Maintain open communication with neighbors and address any concerns promptly
• Keep detailed records and stay current on tax filings
• Provide a high-quality rental experience to generate positive reviews and repeat bookings
• Stay engaged with the city and adapt to any rule changes over time

While the regulations pose challenges, many Lincoln hosts find ways to operate profitable and compliant STRs. The key is to approach it as an informed, detail-oriented business and build positive relationships with guests and neighbors alike.

As one Reddit host summarized, "It's a lot of work to do it right, but it can still be very rewarding if you have the right property and mindset."4

The STR market in Lincoln continues to evolve, shaped by a mix of growing demand and efforts to mitigate community impacts. For hosts, staying engaged and adaptable is crucial to long-term success in this dynamic industry.

Conclusion

In summary, Lincoln has established a fairly robust regulatory framework for short-term rentals in recent years. From licensing to taxes to zoning restrictions, hosts must navigate a range of requirements to operate legally.

While some see the rules as overly restrictive, the city aims to balance the benefits of STRs with the need to preserve neighborhood character and housing stock. For hosts, it's crucial to thoroughly research the regulations, secure proper licensing, and maintain a detail-oriented approach to management.

By providing quality rentals, paying taxes, and being a good neighbor, STR operators can still find success in Lincoln's evolving market. The key is to stay informed, adaptable, and focused on delivering a positive experience for guests and the broader community.

With careful planning and compliance, short-term rentals can continue to thrive in Lincoln, offering income for hosts and flexible options for visitors. As the industry matures, open communication between hosts, guests, neighbors, and city officials will be essential to striking the right balance.ShareRewrite