Is Rental Arbitrage Legal in Washington, DC?
Only in your own home. DC licenses short-term rentals only in the owner's primary residence, shown by homestead deduction eligibility, and the owner must be an individual. Hosted stays have no annual cap. Stays where the guest has the whole home are capped at 90 nights a year, and each stay is up to 30 nights. Both licenses cost $99 for two years.
Can a renter do rental arbitrage here? Only your own home. Short-term rentals are licensed only in the host's own primary residence, so leasing a separate unit to rent out is not possible.
Requirements
- District short-term rental license (host present) or vacation rental license (guest has the whole home): $99 for two years, applied for online at boss.dc.gov
- The property must be owned by an individual and be the owner's primary residence (homestead deduction eligible)
- A Certificate of Clean Hands from the Office of Tax and Revenue; you are not eligible with more than $1,000 in unpaid fees, fines, taxes or penalties
- At least $250,000 in liability insurance, from the booking platform or an insurer
- Working smoke and carbon monoxide detectors and a portable fire extinguisher
- A 24-hour phone number for yourself or your representative
- If you live in a condo or HOA, an attestation that the association allows short-term rentals or written permission
- Host's license number on every listing
- Keep a record of each booking for two years
- Transient lodging tax, collected by booking services for hosts
Restrictions
- Vacation rental (unhosted) license: up to 90 nights cumulatively per calendar year, unless you qualify for an exemption for work outside DC or serious medical or family care lasting more than 90 days
- Each stay is capped at 30 consecutive nights
- Maximum occupancy is eight guests or two per bedroom, whichever is greater
- Not available for a unit you lease and don't own
- Investment properties and corporate-owned units are not eligible
- Accessory dwelling units, including English basements, qualify if the owner meets homestead eligibility
Official permit or registration page
Next Step
Legal is one half of the decision. The other half is whether the deal earns enough to be worth the risk.
Run the numbers for Washington, DC See the Washington, DC market
Sources
Frequently Asked Questions
- Can I Lease an Apartment in DC and Rent It Short-Term?
- No. The District's licenses require the property to be the owner's primary residence, so a renter who doesn't own can't hold one.
- What Are the Two DC License Types?
- A short-term rental license for hosted stays and a vacation rental license when the guest has the whole home.
- How Many Nights Can I Rent?
- Hosted stays have no annual cap. A vacation rental is capped at 90 nights a year, and each stay is limited to 30 consecutive nights.
- What Does a DC License Cost?
- $99 for a two-year license.
- Do Platforms Check the License?
- Yes. Platforms are required to list the host's license number in the listing.