New London, Connecticut Short-Term Rental Regulation: A Guide For Airbnb Hosts

New London, Connecticut

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What are Short-Term Rental (Airbnb, VRBO) Regulations in New London, Connecticut?

Short-term rentals, such as those listed on Airbnb and VRBO, have become increasingly popular in New London, Connecticut. However, as the industry grows, so does the need for regulation to address concerns about noise, parking, and the impact on local housing markets. Here's what you need to know about short-term rental regulations in New London.

Starting a Short-Term Rental Business in New London

Currently, short-term rentals are not specifically regulated in New London, unlike conventional bed and breakfasts, which face strict regulations. However, this may change soon as Connecticut lawmakers are considering stricter laws for short-term rentals ahead of the summer season.

Under proposed Bill 335, municipalities like New London would gain the ability to establish ordinances governing short-term rental properties. Potential measures could include zoning restrictions, guest occupancy limits, and parking requirements. The bill has been approved by the Planning and Development Committee and is moving to a vote.

The push for regulation comes as neighborhoods complain about noise, parking issues, and other nuisances caused by some short-term rental guests. State Senator Catherine Osten, who represents the 19th District, including Norwich, is leading the legislative effort after hearing complaints from residents about large parties and unsafe conditions in residential areas not designed for such activity.

While New London has not enacted specific short-term rental regulations yet, hosts are still required to obtain a permit from the city and follow state safety and health regulations, including having smoke and carbon monoxide detectors. Professional vacation rental management companies can help navigate the permitting process and ensure compliance.

Despite the lack of targeted regulations currently, starting a short-term rental in New London requires careful consideration. The most desirable locations are near the waterfront and downtown, with sought-after amenities, including water views and outdoor spaces. However, competition from hotels and other rentals can be challenging.

Prospective short-term rental operators should also be aware of the seasonal nature of the New London market. Peak season is during the summer months from June to August, with moderate demand in the shoulder seasons of April-May and September-October. Winter sees the lowest tourism.

Short-Term Rental Licensing Requirements in New London

Currently, New London does not have any specific licensing requirements for short-term rentals. Unlike traditional bed and breakfasts, which face strict regulations, short-term rentals like those listed on Airbnb and VRBO are not specifically regulated by the city at this time.

However, this may change in the near future. The Connecticut state legislature is currently considering Bill 335, which would grant municipalities the authority to establish their own ordinances governing short-term rental properties. If passed, this bill would allow New London to implement measures such as:

  • Zoning restrictions
  • Guest occupancy limits
  • Parking requirements
  • Permitting and registration of short-term rentals

While the details of any potential licensing requirements in New London are still unknown, hosts would likely need to apply for a permit from the city and pay an associated fee if such an ordinance is enacted. The permit application process would probably require submitting information about the property, its owner, and the intended use as a short-term rental.

Hosts would also need to ensure their property is in compliance with any new regulations, such as limits on the number of guests, parking availability, and safety requirements like smoke and carbon monoxide detectors. Failure to obtain a permit or adhere to the ordinance could result in fines and penalties.

The timeline for processing permit applications would depend on the specific procedures put in place by the city. Based on other municipalities considering similar ordinances, the process could take several weeks to a couple months.

It's important to note that even without specific short-term rental licensing requirements, hosts in New London are still expected to comply with other applicable laws and regulations, such as the state's 15% room occupancy tax and any relevant health and safety codes.

As the popularity of short-term rentals continues to grow, many communities in Connecticut are grappling with how to effectively regulate the industry to balance the rights of property owners with the concerns of residents. New London appears poised to tackle this issue in the coming months and years, so hosts and residents alike should stay tuned for developments that could bring new licensing and operating requirements for short-term rentals in the city.

Required Documents for New London Short-Term Rentals

Based on the current lack of specific short-term rental regulations in New London, there are no city-mandated documents required to operate an Airbnb, VRBO, or similar rental. However, there are a few general business requirements to keep in mind:

Connecticut Sales and Use Tax Permit: All businesses selling goods or services in Connecticut must register with the Department of Revenue Services (DRS) and obtain a Sales and Use Tax Permit. This allows you to collect and remit the required taxes. You can register online through the DRS website.

Business License: Depending on the nature of your short-term rental business, you may need to obtain a general business license from the city. Contact the New London Building Division to determine if this applies to your situation.

Zoning Compliance: While there are no specific zoning regulations for short-term rentals in New London currently, it's important to ensure your property is in compliance with the city's general zoning laws. Check with the New London Planning and Zoning Division to confirm your property's zoning designation and any applicable restrictions.

Health and Safety Compliance: All rental properties in Connecticut must meet basic health and safety standards, including having working smoke and carbon monoxide detectors, safe electrical and plumbing systems, and proper sanitation facilities. The Ledge Light Health District can provide guidance on these requirements.

As mentioned previously, the Connecticut state legislature is considering a bill that would allow municipalities to establish their own short-term rental ordinances. If such an ordinance is enacted in New London, additional documentation may be required, such as:

  1. Short-term rental permit application
  2. Proof of property ownership or landlord permission
  3. Floor plan of the rental space
  4. Parking plan
  5. Proof of insurance
  6. Signed acknowledgement of short-term rental rules and regulations

Until any specific short-term rental regulations are put in place, hosts in New London should focus on complying with existing business and property laws, being good neighbors, and staying informed about any legislative changes that could affect their operations. As always, consulting with local officials and legal professionals can help ensure you have all the necessary documents and are in full compliance with the law.

New London Short-Term Rental Taxes

Short-term rental operators in New London, Connecticut, are subject to various taxes at the state and local levels. Understanding these tax obligations is crucial for hosts to remain compliant and avoid potential penalties.

Connecticut State Room Occupancy Tax

The primary tax that applies to short-term rentals in New London is the Connecticut State Room Occupancy Tax. This tax is set at a rate of 15% of the listing price, including any cleaning fees, for the first 30 nights of any reservation. For bed and breakfast establishments, the rate is slightly lower at 11%.

It's important to note that if a reservation exceeds 90 nights, the room occupancy tax does not apply to the entire reservation. This tax is typically collected by the short-term rental platform, such as Airbnb, and remitted to the Connecticut Department of Revenue Services on behalf of the host.

Connecticut State Sales Tax

In addition to the room occupancy tax, short-term rentals in New London may also be subject to the Connecticut State Sales Tax. This tax is levied at a rate of 6.35% on rental transactions, including any cleaning or service fees paid by guests. Hosts are responsible for collecting this tax at the time of booking and reporting and paying it to the state each filing period.

Local Taxes

While there are no specific local taxes for short-term rentals in New London at this time, it's essential for hosts to stay informed about any potential changes in local legislation. As the short-term rental industry continues to grow, municipalities across Connecticut are considering implementing their own regulations and taxes to address concerns about housing availability, neighborhood impact, and fair competition with traditional lodging businesses.

Tax Deductions and Write-Offs

Short-term rental operators in New London may be able to take advantage of several tax deductions to offset their income tax liability. These deductions can include:

  1. Airbnb commissions and fees
  2. Mortgage interest
  3. Insurance premiums
  4. Property taxes
  5. Indirect costs such as rent, travel expenses, utilities, and software subscriptions for property management

It's crucial for hosts to keep accurate records of all expenses related to their short-term rental business and consult with a tax professional to ensure they are claiming all eligible deductions.

In summary, short-term rental hosts in New London must navigate a complex landscape of state and potentially local taxes. By understanding their tax obligations, collecting the appropriate taxes from guests, and taking advantage of available deductions, hosts can operate their rentals in compliance with the law and optimize their financial outcomes.

Connecticut-Wide Short-Term Rental Rules

While there are currently no comprehensive statewide laws regulating short-term rentals in Connecticut, the state legislature is considering a bill that would grant municipalities more authority to establish their own ordinances governing these properties.

Under the proposed Bill 335, which has been approved by the Planning and Development Committee and is moving to a vote, cities and towns like New London would gain the ability to:

  1. Establish zoning restrictions for short-term rentals
  2. Set guest occupancy limits
  3. Implement parking requirements
  4. Create a registry of short-term rental properties
  5. Ban short-term rentals altogether

The bill comes as many neighborhoods across Connecticut have complained about issues related to short-term rentals, such as noise, parking problems, and large parties that can create unsafe conditions in residential areas not designed for such activity.

State Senator Catherine Osten, who represents the 19th District, including Norwich, is leading the legislative effort. She believes the bill would provide a necessary framework for short-term rentals to fit harmoniously into residential neighborhoods and give communities the tools they need to address challenges.

While the bill would not require municipalities to take action, it would give them the option to craft regulations tailored to their specific needs and concerns. Each city would decide what their short-term rental licensure and rules would entail.

In addition to the proposed local regulatory authority, short-term rentals in Connecticut are subject to the state's room occupancy tax. Hosts must collect and remit a 15% tax on the listing price, including any cleaning fees, for the first 30 nights of a reservation. For bed and breakfast establishments, the rate is slightly lower at 11%.

It's important to note that if a reservation exceeds 90 nights, the room occupancy tax does not apply to the entire reservation. Airbnb collects and remits this tax on behalf of hosts in Connecticut.

As the short-term rental market continues to grow in Connecticut, particularly with the approaching summer vacation season, the proposed legislation aims to strike a balance between supporting this industry and protecting the character and quality of life in residential neighborhoods.

Short-term rental operators in New London and across the state should stay informed about the progress of Bill 335 and be prepared to adapt to any resulting changes in local regulations. Compliance with tax obligations, zoning laws, and any new ordinances will be critical to running a successful and legal short-term rental business in Connecticut's evolving regulatory landscape.

Does New London Strictly Enforce STR Rules?

Based on discussions in online forums like Bigger Pockets and Reddit, as well as local news reports, it appears that New London does not currently have strict enforcement of short-term rental regulations. This is largely because the city has not yet enacted specific ordinances targeting Airbnb and VRBO properties.

Compared to some other Connecticut municipalities that have implemented detailed zoning rules, permit requirements, and occupancy restrictions for short-term rentals, New London is relatively hands-off at the moment. Cities like Groton and Ledyard have taken a more proactive approach to regulating the industry.

However, this may change soon as residents have increasingly complained to city officials about noise, parking issues, and disruptive behavior at some short-term rental properties in their neighborhoods. In response, the New London City Council is considering drafting new regulations to address these concerns.

Despite the current lack of strict enforcement, New London cannot be considered overly Airbnb-friendly. The city's zoning laws still technically prohibit short-term rentals in residential areas, even if this rule is not actively enforced. The growing push from residents for the city to take action also suggests that unregulated growth of Airbnb and VRBO properties will not be tolerated long-term.

Nevertheless, it seems many hosts continue to operate short-term rentals in New London, taking advantage of the regulatory gaps and limited enforcement. Online forums include posts from hosts discussing their successful Airbnb businesses in the city, with little mention of pushback from officials.

This trend of hosts operating in a legal gray area is common across Connecticut, as the state has not implemented comprehensive short-term rental laws. However, the tide appears to be turning, with the state legislature considering a bill to allow municipalities to create their own regulations.

In summary, while New London may not be cracking down on short-term rentals to the same degree as some neighboring towns, the city is far from a haven for Airbnb and VRBO hosts. As complaints mount and statewide legislation progresses, stricter enforcement is likely on the horizon. Hosts operating in New London, despite the current rules, should prepare for potential changes that could significantly impact their businesses.

How to Start a Short-Term Rental Business in New London

Starting a short-term rental business in New London, Connecticut, can be a lucrative venture, but it requires careful planning and execution. Here are the key steps to get started:

  1. Research local regulations: Before investing in a property, thoroughly research New London's current short-term rental regulations. While the city doesn't have specific rules yet, proposed state legislation could allow municipalities to enact ordinances governing short-term rentals. Stay informed about any upcoming changes that could affect your business.
  2. Choose the right property: Look for properties in desirable locations, such as near the waterfront or downtown. Consider factors like parking, amenities, and the potential for year-round bookings. Analyze the local market to ensure there's demand for short-term rentals in your chosen area.
  3. Obtain necessary permits and licenses: Once you've selected a property, obtain any required permits and licenses from the city. Currently, New London doesn't have a specific short-term rental permit, but you may need a general business license. Ensure your property meets all safety and health regulations, including smoke and carbon monoxide detectors.
  4. Set up your rental space: Furnish and decorate your rental to appeal to your target guests. Invest in quality furniture, linens, and amenities to create a welcoming atmosphere. Consider hiring a professional photographer to showcase your property in the best light.
  5. Create a compelling listing: Craft an attractive listing on popular platforms like Airbnb and VRBO. Use clear, concise language to highlight your property's unique features and amenities. Include high-quality photos and detailed information about the space, local attractions, and house rules.
  6. Establish a pricing strategy: Research comparable rentals in the area to determine competitive rates. Use dynamic pricing tools to adjust rates based on demand, seasonality, and local events. Consider offering discounts for longer stays or during slower periods to attract bookings.
  7. Implement a thorough cleaning and maintenance plan: Cleanliness is crucial for guest satisfaction and positive reviews. Develop a comprehensive cleaning checklist and hire reliable cleaners to ensure the property is spotless between guests. Regularly inspect and maintain the property to prevent issues and address any repairs promptly.
  8. Provide excellent customer service: Respond promptly to guest inquiries and maintain open communication throughout their stay. Offer local recommendations and be available to address any concerns or issues that arise. Encourage guests to leave reviews and respond to feedback professionally.
  9. Promote your listing: In addition to listing on short-term rental platforms, promote your property through social media, local tourism websites, and targeted advertising. Encourage satisfied guests to recommend your rental to friends and family.
  10. Comply with tax obligations: Short-term rental operators in New London must collect and remit the 15% state room occupancy tax. Keep accurate records of all transactions and consult with a tax professional to ensure compliance with any applicable local taxes.

Tips for success:

  1. Continuously monitor and adapt to changes in local regulations and market conditions.
  2. Provide thoughtful amenities and personal touches to create a memorable guest experience.
  3. Build relationships with local businesses and attractions to offer unique perks to your guests.
  4. Regularly update and refresh your listing to maintain a competitive edge.
  5. Consider partnering with a professional short-term rental management company to handle day-to-day operations and optimize your listing's performance.

By following these steps and staying attuned to the unique characteristics of the New London market, you can launch and grow a successful short-term rental business in this charming coastal city.

Who to Contact in New London about Short-Term Rental Regulations and Zoning?

If you have questions or concerns about short-term rental regulations and zoning in New London, here are the key contacts and resources:

  1. City of New London Planning & Zoning Division
    Michelle Johnson Scovish, Planning, Zoning and Wetlands Official
    Address: City Hall, 2nd Floor, 181 State Street, New London, CT 06320
    Phone: 860-437-6381
  2. City of New London Economic Development Department
    Felix J. Reyes, Director of Economic Development and Planning
    Address: 181 State Street, New London, CT 06320
    Phone: 860-437-6392
  3. Renaissance City Development Association (RCDA)
    Peter Davis, Executive Director
    Address: 216 Howard Street, New London, CT 06320
    Phone: 860-917-5283

In addition to contacting city officials, connecting with other short-term rental hosts in New London can provide valuable insights and support. Here are some online communities to check out:

Airbnb Community Local Host Clubs: Find the New London area Host Club on the Airbnb Community website. Join the Facebook group to connect with local hosts, share advice, and stay updated on Airbnb news and events.

BiggerPockets New London Forum: BiggerPockets has a forum thread specifically for rental properties in New London. While not exclusively focused on short-term rentals, this is a good place to network with local real estate investors and get input on the New London market.

Connecticut Subreddit: The Connecticut subreddit is a general forum for discussing topics related to living and working in the state. You may find posts about short-term rentals or be able to connect with hosts in the New London area.

By reaching out to city officials and engaging with the local host community, you can stay informed about current and upcoming short-term rental regulations in New London and get the support you need to run a successful Airbnb business in this charming coastal city.

What Do Airbnb Hosts in New London on Reddit and Bigger Pockets Think about Local Regulations?

While there are limited discussions, specifically from New London Airbnb hosts, about local regulations, some insights can be gleaned from related threads on Reddit and Bigger Pockets:

In a Reddit thread about rental recommendations in New London County, one commenter noted that "New London is expensive af so unless you can fork over a lot of money gl." This suggests that short-term rental regulations may not be the top concern, as the high cost of real estate itself poses a significant barrier to entry for hosts.

A post on the Connecticut subreddit about unrealistic rent prices touched on how the influx of workers with high-paying jobs at Electric Boat in Groton is driving up rental costs in the New London area. While not directly related to short-term rentals, this points to the broader housing dynamics that Airbnb hosts must navigate.

In a Bigger Pockets thread about investing in multi-family properties in the New London area, the original poster expressed interest in house hacking but did not mention any concerns about short-term rental regulations, suggesting this may not be a top-of-mind issue for local real estate investors.

Another Bigger Pockets thread about a quick drive-by of multi-family homes in New London focused more on the condition of the properties and surrounding neighborhood than on regulatory concerns. The investor was worried about attracting quality long-term tenants, given the area's challenges.

While these threads provide some context about the New London housing and rental market, they do not directly capture the sentiments of local Airbnb hosts regarding short-term rental regulations. The lack of targeted discussions on this topic may indicate that New London's regulatory landscape for short-term rentals is not as contentious or restrictive as in other cities.

However, with Connecticut's legislature considering a bill to allow municipalities to enact their own short-term rental ordinances, New London hosts may soon face new rules that could impact their businesses. As the regulatory environment evolves, it will be important to monitor local forums and communities for reactions and experiences from New London's Airbnb host community.

Disclaimer: While we here at BNBCalc strive to keep all of our city regulation guides updated and accurate with all the latest local laws, we still do not suggest using them as your sole or primary source for local regulations. We also do not recommend you rely on the third-party sources we link to or reference, and we are not responsible for any of the information on these third-party sites. These guides are for entertainment purposes only and only provide basic information and should not be considered as legal advice.

We highly recommend directly contacting the responsible parties for each city and hearing what their officials have to say. Ultimately, it's your responsibility as an investor to ensure you fully comply with the local laws, and it's best to speak with professionals before making an investment decision.

Reveal your property’s rental profitability

Buy this property and list it on Airbnb.