Is Rental Arbitrage Legal in Maryland?
No statewide STR ban or license. Fire safety law effective October 1, 2026 applies uniformly. Local control: 10 counties/Baltimore City require STR licenses; many municipalities add requirements. Baltimore City severely restricted (primary residence/hosted only). Regulations vary dramatically by county and city.
Can a renter do rental arbitrage here? Only in limited areas. Renters can only operate in certain zones, or with a special approval. Confirm the exact property qualifies before you sign.
Requirements
- Free Maryland sales and use tax license from Comptroller only (no fee). Fire safety devices with photographic proof (smoke/CO alarms, fire extinguisher min 2A:10BC, posted evacuation diagrams) required as of October 1, 2026. County/city-specific requirements vary: 10 counties require local licenses (Anne Arundel, Baltimore City, Baltimore County, Dorchester, Montgomery, Prince George's, Worcester, Garrett, Kent, Talbot). Host must register with Comptroller for tax purposes.
Restrictions
- 10 counties and numerous cities mandate short-term rental licenses. Baltimore City restricted to primary residence with hosted arrangement; stopped issuing licenses for new unhoused rentals in 2020. Each county sets zoning requirements and regulations. Unlicensed operation may result in permanent program exclusion and enforcement. Failure to obtain required license prevents eviction action in District Court.
Taxes and Fees
- State sales tax 6% flat. County hotel tax varies by jurisdiction (5-9.5%). Platforms auto-collect taxes in only 7 Maryland jurisdictions; hosts in other counties must remit county tax themselves.
Cities in Maryland
Next Step
Legal is one half of the decision. The other half is whether the deal earns enough to be worth the risk.
Sources
Frequently Asked Questions
- Who Sets Short-Term Rental Rules in Maryland?
- Local governments. Baltimore City is the market covered on this site.
- What Does Baltimore Require?
- A license, a principal residence deeded in the owner's own name and no code violations. See the Baltimore page.