Ocean City Short-Term Rental Regulations

New to short-term rentals? Jump to the compliance checklist →

Permit & Licensing

Rental License

This permit type does not require primary residence.

Supplementary Short-Term Rental License

This permit type does not require primary residence.

Application Process

Apply through Division of Rental Housing (online via Click2Gov or in-person); provide owner/agent contact information; inspection may be required; license issued within 14 days; annual renewal due May 1

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

Tax Obligations

Combined rate: 12% of gross rental income.

Collection: Self-remit: property owner or agent must register with Maryland Comptroller for state sales tax; file Room Tax Report monthly with Worcester County Treasurer; platforms may remit on behalf of hosts

Filing: Monthly; Room Tax Report due by the 21st of the month for the previous month's rentals

Rental Limits

Ocean City does not impose an annual cap on the number of nights you can rent.

Occupancy & Density Limits

R-1/MH districts: 2 persons per bedroom plus 2 additional (excluding children 10 and under), midnight–7am. Other zones: 40 sq ft per person.

Zoning & Restrictions

STRs require supplementary short-term rental license effective January 1, 2025. New STR permits in R-1 and MH districts subject to moratorium through January 3, 2027.

Insurance & Safety

Insurance

Ocean City does not require short-term rental operators to carry specific insurance. Standard homeowner policies often exclude short-term rental activity, so many hosts obtain dedicated short-term rental or landlord liability coverage.

Safety & Operating Requirements

• Property must comply with International Property Maintenance Code (Chapter 10)
• Fire safety inspection required (Office of the Fire Marshal for hotels, motels, and condo buildings)
• Rental Housing Inspection on 5-year rotation
• Must declare number of bedrooms and available parking
• Cannot advertise more bedrooms than approved on building permit plans
• No unauthorized conversions of rooms, attics, or garages to bedrooms

Penalties for Non-Compliance

• Written notice of violation with 10 days to correct
• Municipal infraction issued if not corrected
• Each day of violation is a separate violation
• License may be suspended (up to 30 days) or revoked
• Fine of up to $5,000 per violation in lieu of suspension

Platform Requirements

• Must include valid rental license control number in all advertisements/listings
• Must verify license validity before facilitating rentals
• Must stop listing units notified as unlawfully used for rental
• Must maintain records of all rental housing units facilitated
• Must provide mandatory field for rental license number on their online site

Compliance Checklist

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

1. Determine your permit type. Ocean City has 2 permit types. Identify which applies to your property (Rental License, Supplementary Short-Term Rental License).
2. Meet safety requirements. Property must comply with International Property Maintenance Code (Chapter 10). Fire safety inspection required (Office of the Fire Marshal for hotels, motels, and condo buildings). Rental Housing Inspection on 5-year rotation. Must declare number of bedrooms and available parking. Cannot advertise more bedrooms than approved on building permit plans. No unauthorized conversions of rooms, attics, or garages to bedrooms.
3. Apply for your STR permit. Submit application. Fees vary by type: Rental License $196; Supplementary Short-Term Rental License Additional $50 (in addition to Rental License). See permit types above to determine which applies.
4. Register for tax accounts. Set up lodging tax accounts with Maryland Comptroller (state sales tax); Worcester County Treasurer's Office (room tax).
5. Display your permit number. Include your permit/license number in all listings and advertisements.
6. Collect and remit taxes. 12% on all bookings.
7. Renew annually. $196 renewal fee.

Frequently Asked Questions

Do you need a permit to run an Airbnb in Ocean City?

Yes. Ocean City requires a short-term rental permit to operate an Airbnb or Vrbo, and there are 2 permit types. See the permit types above to find which applies to your property.

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

A short-term rental permit in Ocean City costs $196.

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

No. Ocean City allows non-owner-occupied short-term rentals, so investment properties can qualify provided you hold the required permit.

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

Ocean City 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 Ocean City?

Short-term rental stays in Ocean City are subject to a combined 12% in lodging taxes. This combines 6% Maryland State Sales and Use Tax + 6% Worcester County Room Tax. The host is responsible for collecting and remitting them.

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

Operating without a permit can cost up to $5,000 per violation.