Washington, D.C. Short-Term Rental Regulation

Are you a D.C. homeowner interested in renting out a bedroom, basement, or entire home on Airbnb or any other platform? Washington, D.C., one of the strongest real estate markets in the country with more than 5,100 short-term vacation rentals, is enforcing a new law governing short-term and vacation rentals in the District.

The Short-Term Rental Regulation Act of 2018 (14 DCMR Section 9901.6), which took effect on December 3, 2021, requires ALL short-term rental and vacation rental properties booked on platforms such as Airbnb and Vrbo to be licensed by the Department of Regulatory Affairs (DCRA).

Two types of licenses available:

Short-term rentals: Allow hosts to offer fee-based lodging at their primary residence while the host is present on the property (e.g., bedroom within a home). As long as the host is present, there is no limit on the number of stays allowed during the calendar year. However, each short-term rental stay is limited to 30 or fewer continuous nights.

Vacation rentals: A type of short-term rental allowing hosts to offer fee-based lodging at their primary residence without being present on the property (e.g., a full home). Cumulatively, vacation rentals cannot exceed 90 nights in any calendar year, and each rental is limited to 30 or fewer continuous nights.

Fees:

The total cost for the Short-Term or Vacation Rental License is $104.50 (includes a $70.00 processing fee, $25.00 endorsement fee, and 10% technology fee).

D.C. Department of Consumer and Regulatory Affairs began accepting license applications on January 10, 2022. The agency will begin enforcing the law’s provisions on April 10, 2022. Failure to obtain a license will result in enforcement action, including fines starting at $500 for the first violation, $2,000 for the second violation, and $6,000 for a third violation plus a revocation of the related short-term rental license endorsement. Additionally, a booking service found to be in violation will be liable for a civil penalty of $1,000 for each booking transaction made in violation of the act.

In order to operate a short-term or vacation rental in the District, the property must be owned by an individual and serve as the homeowner’s primary residence (with the owner being eligible to receive the Homestead Tax Deduction). Investment properties and those owned by corporate entities are not eligible.

Requirements to apply:

• Proof of liability insurance with minimum of $250,000 coverage
• Certificate of Clean Hands issued within the last 30 days in the property owner’s name obtained from the Office of Tax and Revenue
• If rental is a co-op, condo, or if the property is in a community where there is a HOA, an owner must attest that short-term and/or vacation rentals are allowed or that they have received written permission from the association.

Resources:

• Apply for a license here.
• Confirm licensure here.
• Request a new Certificate of Clean Hands or check status of existing Certificate of Clean Hands here.
• Violations can be reported to the District of Columbia Short-Term Rental Hotline by calling 202-221-8550.

For additional information on this topic, contact Evelyn Miller, Partner, at 202-753-7400.