Richmond Short Term Rental Regulation: A Guide For Airbnb Hosts

Starting a Short Term Rental Business in Richmond

Short-term rentals (STRs) through platforms like Airbnb and VRBO have exploded in popularity in Richmond in recent years. The number of active STR listings in the city surged 76% over the past three years to over 1,100 as of September 2023.

However, in response to the booming STR market, Richmond has enacted strict new regulations to govern short-term rentals and protect the city's housing supply. The most significant restriction is that STR operators in residential districts can only rent out their primary residence where they live for at least 185 days per year.

Hosts must prove residency with documentation like DMV or voter registration records. Additionally, only one STR listing is permitted per residential property. In multi-family buildings, a maximum of 10 units or one-third of units, whichever is less, can operate as STRs.

The ordinance also sets rules on parking (one off-street space required per rented bedroom), signage, occupancy limits (2 guests per bedroom, up to 5 bedrooms), and safety requirements like smoke detectors. These regulations have sparked backlash from many STR operators who say it will significantly hurt their rental businesses.

Short Term Rental Licensing Requirement in Richmond

To legally operate a short-term rental in Richmond, hosts must obtain a Short-Term Rental Permit from the city's Zoning Administration Division. The biennial permit costs $300 and is valid for two years from the date of issuance.

Hosts are required to prominently display their STR permit number on all listings and advertisements, such as on Airbnb, VRBO, and other booking platforms. Operating a short-term rental without a valid permit can result in fines up to $2,500 and potential jail time.

The permit process involves submitting an application with supporting documentation and passing a property inspection. City officials estimate that only about 63 of the 1,100 active STR listings had obtained permits as of June 2023, but they plan to increase enforcement under the new rules.

Required Documents for Richmond Short Term Rentals

When applying for a Short-Term Rental Permit, hosts must submit the following documents to the Richmond Zoning Administration Division:

• Proof of residency documentation, such as a driver's license, vehicle registration, or voter registration card showing the STR property address
• Completed Short-Term Rental Affidavit signed by the host certifying they will comply with all STR regulations
• Floor plan of the rental property showing room dimensions, exits, and locations of safety equipment
• Number and location of smoke detectors, carbon monoxide detectors, and fire extinguishers

The city may request additional documentation as needed to verify eligibility for an STR permit. Once all required documents are submitted, the Zoning Administration Division will review the application and schedule a property inspection before issuing the permit.

Richmond Short Term Rental Taxes

As of July 1, 2023, short-term rentals in Richmond are subject to the same 8% transient lodging tax as traditional hotels and lodging providers. STR hosts are responsible for collecting this tax from their guests and remitting it to the city on a monthly basis.

However, if the STR booking is made through a platform like Airbnb or VRBO that collects and remits taxes on behalf of the host, then the host does not need to separately remit the tax for those bookings. Hosts should verify their booking platform's tax collection policies.

The 8% STR tax is projected to generate over $3.2 million in additional annual revenue for the city, with the proceeds dedicated to supporting the Greater Richmond Convention Center. Short-term rentals are also subject to Virginia's retail sales tax of 5.3% on rentals under 90 days, which hosts must collect and remit to the state Department of Taxation.

Richmond-wide Short Term Rental Rules

Richmond's comprehensive STR ordinance that took effect in September 2023 includes these key provisions that apply citywide:

• In residential districts, STRs are only allowed at the operator's primary residence where they live for 185 or more days per year
• Only one STR listing permitted per residential property, including condos, townhouses, and single-family homes
• Multi-family apartment buildings are limited to 10 STR units maximum or one-third of total units, whichever is less
• Two guests allowed per bedroom, with a maximum of 5 bedrooms and 10 guests total per STR
• One off-street parking space required for each rented bedroom, in addition to the parking required for the residential unit
• STR permit number must be displayed on all listings, advertisements, and postings

The ordinance aims to strike a balance between allowing STRs to operate while preventing the loss of housing stock and protecting neighborhood character. However, it has generated significant controversy, with many hosts arguing the rules are overly restrictive and will hurt the local tourism economy.

Does Richmond strictly enforce STR rules?

While Richmond has had STR regulations on the books since 2020, actual enforcement of the rules has been very limited so far. As of June 2023, the city had only issued 63 STR permits, even though there were an estimated 1,100 active STR listings in Richmond at the time.

With the passage of the much stricter 2023 STR ordinance, Richmond officials have pledged to significantly ramp up enforcement efforts. The city plans to hire two additional dedicated zoning enforcement officers to identify and cite non-compliant STRs. Fines for violations can reach up to $2,500, with the potential for misdemeanor charges and jail time for repeated offenses.

Compared to many other cities, Richmond's new STR regulations, especially the primary residence requirement prohibiting most un-hosted STRs in residential areas, are relatively strict. Some city council members have even admitted to previously operating STRs themselves without being fully compliant under the old rules.

Despite the new regulations, many hosts continue to operate STRs in Richmond without obtaining permits or meeting all the requirements. On the Richmond subreddit and Bigger Pockets real estate investing forums, numerous hosts have expressed frustration and confusion with the new rules, saying it will significantly hurt their livelihoods. Some are considering switching to 30+ day rentals instead to avoid the STR restrictions.

Is Richmond Airbnb friendly?

With its strict new primary residence requirement effectively banning most un-hosted STRs in residential neighborhoods, Richmond is becoming a less Airbnb-friendly city than it used to be, especially compared to other markets with looser rules. The regulations have sparked an outcry from many hosts who rely on STR income to make ends meet.

However, Richmond officials believe the tighter rules are necessary to protect the city's limited housing stock and maintain neighborhood character in the face of the explosive growth of STRs. The city has seen a 76% increase in STR listings over the past three years, raising concerns about housing availability and affordability.

As a compromise, the Richmond City Council has agreed to revisit the STR regulations in late 2024, one year after they take effect, to evaluate their impacts and determine if any changes are warranted. Officials want to strike a balance between allowing STRs to operate while mitigating negative effects on neighborhoods and housing supply.

How to Start a Short Term Rental Business in Richmond

• Carefully review Richmond's STR regulations to check your eligibility to operate a short-term rental at your specific property under the new rules
• Register for a Short-Term Rental Permit ($300 for 2 years) through the city's online Citizen Portal
• Obtain required safety equipment for your rental, including smoke detectors, carbon monoxide detectors, and fire extinguishers
• Prepare proof of residency documentation, such as your driver's license, vehicle registration, or voter card showing the rental address
• Complete, sign, and submit the city's Short-Term Rental Affidavit certifying you will comply with all STR rules
• Add your STR permit number to all online listings and advertisements once approved
• Collect the 8% transient lodging tax from guests and remit to the city monthly, unless your booking platform collects and remits it for you
• Register with the Virginia Department of Taxation and collect the 5.3% state sales tax on all rentals under 90 days

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

For questions about Richmond's short-term rental regulations and zoning requirements, contact:

City of Richmond Zoning Administration Division
Phone: (804) 646-6340
Email: PDRZoningAdministration@rva.gov
Web: https://www.rva.gov/planning-development-review/zoning-administration

The Zoning Administration Division handles all STR permit applications, inspections, and enforcement. They can provide guidance on the STR rules and how to obtain a permit.

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

On the Richmond subreddit and Bigger Pockets real estate investing forums, many hosts have expressed strong frustration and opposition to the city's strict new STR rules, especially the primary residence requirement:"

Ninety percent of Airbnb hosts that host in the city of Richmond will lose their opportunity to host if they have to have un[hosted stays]. This is very restrictive and harmful to the small business owners in this city." - Richmond STR operator"

Currently, roughly 1,100 known short-term rentals are operating within city limits. But Vonck reported that the department has issued fewer than 100 permits. This fucking town... way to support small businesses and bring in tourism revenue. Idiots." - Reddit user"I'm strongly considering not offering short term stays anymore, at least for the time being to let these changes settle out, and then reevaluate later in the year. I can't imagine I'm the only host considering this." - Richmond Airbnb host considering switching to 30+ day rentalsSome hosts plan to stop offering STRs in Richmond altogether due to the new regulations, saying it will significantly reduce their rental income.

They argue the city is hurting small business owners and discouraging tourism with the overly burdensome rules.

However, other residents and city officials argue the stricter regulations are necessary to keep housing affordable for residents and protect neighborhood character as STRs have proliferated in recent years. They say preventing out-of-town investors from operating un-hosted STRs in residential areas will help maintain the city's housing stock.

The debate over Richmond's STR regulations appears far from settled, with the city agreeing to reevaluate the controversial rules in late 2024 after seeing their impacts over the first year. For now, STR operators will have to adapt to the much stricter regulatory environment or face fines and legal action from the city.