Airbnb Rules in Denver

Denver has some of the strictest short-term rental rules in Colorado. Hosts can only operate from their primary residence and every short-term rental property needs a short-term rental license, a lodger’s tax ID and proof that the home is truly the host’s primary residence. Investment properties, second homes and non-owner-occupied rentals aren’t allowed under the city’s short-term rental ordinance.

Because enforcement is active, from audits to neighbor complaints to platform monitoring, operating an unlicensed or non-compliant rental in Denver can lead to quick fines and shutdowns. This guide gives you a clear look at Airbnb rules in Denver in 2025, what the primary residence requirement actually involves and the licensing, tax and safety rules every host must follow.

What this guide covers

This guide breaks down Denver’s short-term rental rules in a practical way. You’ll learn how the city defines a short-term rental, what the primary residence rule means in real terms and the full steps to getting a short-term rental license. We’ll also look at documentation requirements, safety standards, tax obligations and the penalties Denver uses to enforce its short-term rental regulations. The focus stays on legal compliance, not hosting strategy.

Who this is for

This guide is for Airbnb hosts, property owners and anyone considering a short-term rental in Denver. It’s also useful for property managers and real estate investors trying to understand how Denver’s rules differ from nearby Colorado cities. If you want to confirm whether your rental property qualifies or you already host and need to stay aligned with local laws, this section will give you the specifics you need.

Why this matters

Denver doesn’t take a light-touch approach to short-term rentals. The city actively monitors platforms, follows up on neighbor complaints and audits hosts to confirm primary residence claims. In the past year, hundreds of unlicensed short-term rentals were flagged, with many shut down for operating outside local laws. What this really means is that hosts can’t rely on guesswork. You need to understand the rules before listing a vacation rental or you risk fines, license revocation and potential penalties tied to false documentation.

What you’ll learn

By the end of this guide, you’ll understand:

• How Denver defines a short-term rental and why only primary residences qualify

• What the primary residence requirement involves and the documents you need

• How to apply for a short-term rental license and a lodger’s tax ID

• Denver’s safety rules, required equipment and ongoing compliance checks

• Key tax obligations, including lodging tax and sales tax

• Common pitfalls for short-term rental hosts and how to avoid enforcement issues

Understanding Denver’s Short-Term Rental Legal Framework

Denver defines a short-term rental as any residential property rented for fewer than 30 consecutive days. These rentals fall under a short-term rental ordinance adopted by the Denver City Council, which was designed to regulate short-term rentals without removing long-term housing from the market. The ordinance is one of the strictest in Colorado and limits legal operation to owner-occupied homes only.

The rules grew out of concerns around housing affordability and the rapid growth of the vacation rental industry. Denver wanted to prevent non-owner-occupied properties from turning into full-time vacation rentals and to keep residential neighborhoods stable. Because of that, every short-term rental must be the host’s primary residence and each host can only have one primary residence in the city.

This legal framework sets the foundation for everything else, licensing, taxes, inspections and enforcement. Once you understand how Denver defines a short-term rental and why these laws exist, the rest of the process becomes easier to navigate.

Primary residence requirement

Denver’s primary residence rule is the backbone of its short-term rental laws. To qualify for a short-term rental license, the property must be your actual home, the place you live most of the year, receive mail and use for everyday life. The city expects hosts to prove this through a valid Colorado driver’s license, voter registration, utility bills or other documents tied to the property address.

Because of this rule, non-owner occupied properties, second homes and investment properties can’t operate as short-term rentals in Denver. You’re also limited to one primary residence, which means you can only hold one active short-term rental license across the city. Denver audits these claims regularly and mismatched documents or unclear residency records are a common reason applications get delayed or denied.

The goal is simple, keep vacation rentals tied to Denver residents and prevent the short-term rental market from shifting into commercial territory.

Business license vs STR license

Denver requires two separate approvals to legally operate a short-term rental: a general business license and a short-term rental license. The business license establishes your short-term rental as a taxable business within the city, while the short-term rental license specifically authorizes you to rent your primary residence for stays under 30 days.

Both licenses must show the same property address, which ties back to Denver’s emphasis on verifying that the rental property is the host’s primary residence. You can’t list a home until the STR license is issued and you can’t stay compliant without an active business license on file. Together, these two approvals form the legal base of any short-term rental business operating in Denver.

Licensing Requirements and Application Process

Denver’s licensing process is detailed and every short-term rental property has to clear several steps before a host can legally operate. The city uses this process to verify the primary residence requirement, confirm that only primary residences qualify and make sure each property owner understands the short-term rental laws that regulate vacation rentals in Denver.

Required documentation

To apply for a short-term rental license, you need to show that the rental property is your host’s primary residence. Denver asks for:

• A valid Colorado driver’s license with the property address

• Two supporting documents such as voter registration, a lease agreement, vehicle registration or utility bills

• Ownership records if you’re the property owner

• A lease agreement with explicit permission for short-term rentals if you’re a renter

• A notarized affidavit confirming the property is the owner’s primary residence

Because Denver wants to regulate short-term rentals tightly, mismatched documents or unclear proof of primary residence are the most common reasons short-term rental hosts see delays. The city checks records through third-party sites and audits to confirm only owner-occupied homes are licensed.

Application fees and timeline

Denver’s licensing fees include the initial application cost and the annual renewal fee required to keep your short-term rental business active. The fees cover processing, compliance checks and verification that the home still qualifies as an owner-occupied property.

Most applications take several weeks to review, especially if the documentation doesn’t clearly show that the host has only one primary residence. Hosts should expect delays if their Colorado driver’s license or voter registration doesn’t match the rental property address.

Lodger’s tax ID registration

Alongside the short-term rental license, every operator must apply for a lodger’s tax ID. This allows you to collect and remit Denver’s lodging tax and city lodger’s tax on rental income. Even if booking platforms handle some tax obligations, the city requires hosts to maintain accurate records.

You’ll use this ID when filing lodging tax, local taxes and sales tax. Denver’s system also connects to state sales tax and county sales tax reporting, so keeping up-to-date information through the Colorado Department of Revenue is essential.

The lodger’s tax ID has to be renewed annually at the same time as the short-term rental license.

Operational Rules and Compliance Standards

Once your short-term rental license is approved, you’re expected to follow Denver’s short-term rental laws throughout the year. These rules cover safety equipment, guest behavior, zoning restrictions and the ongoing responsibilities every property owner takes on when running a short-term rental property in a residential neighborhood.

Denver uses these laws and regulations to keep vacation rentals aligned with local regulations, protect neighbors and make sure short-term rental operators stay compliant with the city’s short-term rental regulations. Falling out of compliance is one of the fastest ways to end up flagged as an illegal short-term rental.

Safety equipment and property standards

Every licensed rental property must meet a set of safety equipment requirements. Denver’s inspections and any later audits look for:

• Smoke alarms in every sleeping area

• Carbon monoxide detectors near bedrooms and fuel-burning appliances

• A working fire extinguisher in an accessible location

• Visible address numbers for emergency responders

• Clear exits and safe egress routes

• Up-to-date wiring, plumbing and building permits

These expectations exist to protect guests and reduce risk under Colorado premises liability laws. Liability insurance is still required, but meeting basic safety standards helps reduce the chance that hosts ever need to rely on it.

How owner-occupied rules apply in daily operations

Because only primary residences can operate in Denver, the rental property has to remain the owner’s primary residence, not a secondary home or one of several vacation rentals. This also affects things like:

• How often you can be away while hosting

• Whether an accessory dwelling unit can be rented

• How guests use spaces inside the home

Short-term rental owners are expected to keep their information up to date and follow all local laws to avoid being classified as unlicensed short-term rentals.

Table: Required safety and compliance elements

Here’s a quick snapshot of the core items Denver expects short-term rental hosts to maintain:

Guest rules, noise and neighborhood expectations

Denver expects short-term rental owners to manage guests proactively. That includes:

• Setting clear quiet hours

• Sharing parking instructions to avoid conflicts with neighbors

• Explaining trash pickup schedules

• Making sure guests respect the property and the block

Neighbor complaints are one of the biggest triggers for investigations. Most issues are avoidable with simple communication and good house rules.

Zoning restrictions and the Denver Zoning Code

While Denver allows short-term rentals in most residential areas, the property still has to comply with zoning restrictions. The Denver Zoning Code dictates how a home can be used and any use that falls outside those rules can lead to immediate enforcement.

Hosts should also know that the city tracks listings across third-party sites, so trying to get around zoning or local laws isn’t realistic in Denver’s current short-term rental market.

Tax Obligations and Financial Requirements

Running a short-term rental in Denver means staying on top of several layers of taxes. These rules are part of the broader short-term rental laws the city uses to keep the short-term rental industry aligned with local regulations and to make sure hosts report rental income correctly. If you operate vacation rentals in other Colorado cities, you’ll notice the structure is different here, so it helps to understand how Denver handles tax obligations from the start.

Lodging tax, sales tax and local taxes

Every short-term rental property in Denver is subject to lodging tax on stays under 30 nights. Hosts also need to track city sales tax, Colorado sales tax and in some cases, Colorado state sales tax depending on how the booking is processed. Even if booking platforms collect some taxes automatically, the property owner is responsible for making sure the numbers are accurate.

Here’s the breakdown most short-term rental operators work with:

• Lodging tax on every booking

• City sales tax on the rental amount

• Colorado sales tax or Colorado state sales tax depending on reporting

• Local taxes tied to the rental property’s exact location

Denver requires a sales tax license and a lodging tax license to keep everything organized under one account. These licenses also help hosts file returns and keep their short-term rental business aligned with all laws and regulations.

What the lodger’s tax ID actually does

Your lodger’s tax ID connects your short-term rental to the city’s tax system. It’s used when you file lodging tax, verify platform remittances and reconcile cleaning fees, business expenses and rental income. Even if Airbnb or other third-party sites submit some taxes for you, the city still expects hosts to keep up-to-date information in their account.

This ID has to be renewed annually, just like your short-term rental license.

Insurance requirements

Denver requires every licensed host to maintain liability insurance that covers short-term rental operations. This is important because standard homeowner policies usually don’t cover guest stays and hosts are still responsible under Colorado premises liability laws if something goes wrong.

Income tracking and documentation

Short-term rental owners must track:

• Rental income

• Cleaning fees

• Cancellations or adjustments

• Any business expenses related to operating vacation rentals

Some hosts also need a federal employer identification number if they run their short-term rental business under an LLC or other entity, though not everyone will use one.

Lease agreements and rental contracts

If the property isn’t owned outright, Denver expects renters to provide a lease agreement or rental contract that explicitly allows short-term rentals. While the city focuses heavily on owner-occupied homes, the paperwork still matters because Denver wants to confirm the host has the legal right to operate the rental property. A property owner is still responsible for compliance even if a tenant manages the listing and the city doesn’t allow more than only one rental contract for the primary residence rule.

Common Challenges and Solutions

Successful short-term rental compliance requires proactive management of documentation requirements, tax obligations and neighbor relations that commonly create enforcement triggers.

Challenge 1: Primary residence documentation mismatches

Solution: Upload written explanations proactively when addresses differ between required documents, providing a clear timeline and circumstances for any address changes.

Documentation mismatches represent the most common cause of application delays, often occurring when recent moves or address changes create inconsistencies between driver’s licenses, utility bills and voter registration records.

Challenge 2: Platform tax collection confusion

Solution: Verify Airbnb tax collection settings and maintain independent documentation even when platforms collect taxes automatically, ensuring backup compliance records.

Hosts remain legally responsible for complete tax compliance regardless of platform collection services, with audit risks requiring independent verification of all tax remittances and exemptions.

Challenge 3: Neighbor complaints and enforcement

Solution: Maintain clear guest communication protocols, noise policies and parking compliance to minimize neighbor complaints that trigger enforcement investigations.

Neighbor reports represent a major source of enforcement actions, with complaint-driven investigations often revealing multiple compliance violations beyond the initial reported issue.

Understanding common challenges prepares hosts for the serious consequences of enforcement actions and penalty structures.

Penalties and Enforcement Actions

Denver employs comprehensive enforcement mechanisms targeting unlicensed short-term rentals, false primary residence claims and ongoing operational violations through dedicated staff and third-party monitoring services.

Common violations and fines

Operating without a short-term rental license results in immediate cease-and-desist orders and escalating daily fines until compliance is achieved. False primary residence claims constitute felony fraud under Colorado law, carrying potential prison sentences up to six years and fines reaching $500,000.

Platform penalties include $1,000 fines levied against booking sites that process transactions for unlicensed short-term rentals, creating additional enforcement pressure through third-party sites monitoring.

License revocation process

Permanent license revocation occurs following repeated violations, false documentation or criminal charges related to short-term rental operations. The revocation process includes formal hearings with appeal rights, but successful appeals require comprehensive documentation addressing all violation allegations.

Revoked operators face permanent exclusion from Denver’s short-term rental market, with no pathway for future license applications, regardless of changed circumstances or property transfers.

Understanding enforcement consequences emphasizes the critical importance of maintaining strict compliance from initial application through ongoing operations.

Conclusion and Next Steps

Denver’s short-term rental regulations create a manageable but strictly enforced compliance framework for legitimate hosts operating from their primary residences, with severe consequences for violations or attempts to circumvent the owner-occupied requirement.

To get started:

1. Verify your property qualifies as your primary residence under Denver’s requirements

2. Gather required documentation, including Colorado driver’s license, utility bills and property ownership records

3. Apply for both the short-term rental license and the lodger’s tax ID through Denver’s online portal

Frequently Asked Questions

1. Can a Denver host leave the country for an extended period while still operating their short-term rental?

Yes, but it depends on how long you’re away. Denver doesn’t publish an exact number of allowable days outside the home, but the expectation is that the property remains the host’s primary residence where they “return regularly.” Leaving for a season or long international travel can raise red flags during audits, especially if your mail or tax records suggest you’re living somewhere else. If you plan a long absence, it’s smart to keep documentation that shows the home is still your legal residence.

2. Are hosts allowed to offer long-term stays during slow seasons without affecting their short-term rental license?

They can. Stays of 30 days or more aren’t considered short-term rentals under Denver’s laws, so offering long-term bookings won’t jeopardize your license. Many hosts combine short-term and long-term strategies to stabilize rental income during off-peak months. Just keep in mind that long-term rentals come with different tenant rights under Colorado law, so your lease structure will matter.

3. Can two people who share ownership of the same home both apply for short-term rental licenses?

No — even in shared ownership situations, Denver only allows one short-term rental license tied to one primary resident. If co-owners live in different places (for example, one uses the home part-time), only the person who uses the property as their true primary residence can hold the license. The city is strict about the “one primary residence per person” rule.

4. Are backyard tiny homes or converted garages automatically eligible as short-term rentals?

Not in Denver. Even if an accessory dwelling unit (ADU) is fully permitted, it can only be used as a short-term rental if it sits on the same property as the host’s primary residence — and the host still needs to live in the main home. Detached units that look ideal for Airbnb rarely qualify unless they fit tightly within zoning, occupancy and primary residence rules.