Fayetteville Short-Term Rental Regulations

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Permit & Licensing

Short-Term Rental, Type 1 Business License

The property must be your primary residence. This means investment properties are not eligible for this permit type.

Short-Term Rental, Type 2 Business License (475-unit citywide cap; waitlisted)

This permit type does not require primary residence. Zoning restriction: Conditional use permit (CUP) required for Type 2 STR in residential zoning districts prior to business license issuance; not required in non-residential or mixed-use zoning districts.

Application Process

Apply online via the City's business license portal; Type 1 applicants must provide proof of Homestead Tax Credit or long-term lease as evidence of primary residency; Type 2 applicants in residential zoning districts must first obtain a conditional use permit. All applicants need a life-safety/egress inspection, a homeowners insurance rider, and must register for the Landlord's Representative Registry.

Note: Document requirements vary by permit type. See individual permit sections above for eligibility details.

Tax Obligations

Combined rate: 13.75% of gross rental income.

Collection: Airbnb and HomeAway/VRBO collect and remit the 2% HMR tax on the host's behalf under voluntary collection agreements with the City; owners listing on any other platform must register individually and collect/remit the HMR tax themselves

Filing: monthly

Rental Limits

Fayetteville does not impose an annual cap on the number of nights you can rent. Each individual stay must be less than 30 consecutive days.

Occupancy & Density Limits

No fixed citywide numeric cap; short-term rentals may not exceed the occupancy limit approved with the individual business license

Zoning & Restrictions

No zoning cap on Type 1 (owner-occupied) STRs. Type 2 (non-owner-occupied) STRs are capped citywide at 475 dwelling units and require a conditional use permit in residential zoning districts, with additional density limits: max 4% of detached single-family units within 500 feet, min 100-foot separation between Type 2 detached single-family properties, and multi-family buildings limited to 10% of units (or one unit, whichever is greater) as Type 2.

Insurance & Safety

Insurance

Liability insurance is required for the property's use as a short-term rental, though the required coverage amount is not publicly specified.

Safety & Operating Requirements

• Life safety and egress inspection by the City Building Safety Division required before the license application is approved
• Dwelling unit must comply with Unified Development Code Chapter 173 (Building Regulations)

Penalties for Non-Compliance

• Fine of up to $250.00 per day of operation for operating without a valid business license
• Withholding of city services (water, sewer, solid waste) after one week of continued unlicensed operation, following written notice
• Type 2 STR operating without a valid license: services may be withheld up to 1 month for the initial violation and up to 6 months for the second and subsequent violations, after a due-process hearing
• Revoked STR license bars reapplication on the same property for 12 months
• Three violations in a 12-month period removes the property's STR licensing eligibility for 2 years

Platform Requirements

No short-term rental may be advertised before the operator has obtained a business license, and the business license number must be included in the advertisement/listing

Compliance Checklist

Follow these steps to legally operate a short-term rental in Fayetteville:

1. Determine your permit type. Fayetteville has 2 permit types. Identify which applies to your property (Short-Term Rental, Type 1 Business License, Short-Term Rental, Type 2 Business License (475-unit citywide cap; waitlisted)).
2. Meet safety requirements. Life safety and egress inspection by the City Building Safety Division required before the license application is approved. Dwelling unit must comply with Unified Development Code Chapter 173 (Building Regulations).
3. Obtain liability insurance. Required for property's use as a short-term rental.
4. Apply for your STR permit. Submit application + $88.00 fee. See permit types above to determine which applies.
5. Register for tax accounts. Set up lodging tax accounts with City of Fayetteville Accounting Division.
6. Display your permit number. Include your permit/license number in all listings and advertisements.
7. Collect and remit taxes. 13.75% on all bookings.
8. Renew annually. $35.00 renewal fee.

Frequently Asked Questions

Do you need a permit to run an Airbnb in Fayetteville?

Yes. Fayetteville requires a short-term rental permit to operate an Airbnb or Vrbo, and there are 2 permit types — one requires the property to be your primary residence, and another allows non-owner-occupied (investment) use. See the permit types above to find which applies to your property.

How much does a short-term rental permit cost in Fayetteville?

A short-term rental permit in Fayetteville costs $88.00.

Does Fayetteville require a short-term rental to be your primary residence?

It depends on the permit type. At least one Fayetteville permit requires the property to be your primary residence, while another allows non-owner-occupied (investment) use — see the permit types above.

How many days a year can you short-term rent in Fayetteville?

Fayetteville does not cap the number of nights per year you can short-term rent, though permitting, zoning, and occupancy rules still apply.

What taxes do you pay on a short-term rental in Fayetteville?

Short-term rental stays in Fayetteville are subject to a combined 13.75% in lodging taxes. This combines 6.5% Arkansas State Sales & Use Tax + 2% Arkansas Parks & Tourism Tax + 1.25% Washington County Sales Tax + 2% City of Fayetteville Sales Tax + 2% Fayetteville Hotel, Motel & Restaurant (HMR) Tax. The host is responsible for collecting and remitting them.

What happens if you run a short-term rental without a permit in Fayetteville?

Operating without a permit can cost up to $250 per day of unlicensed operation.