Short-Term Rentals in Chattanooga, TN

If you live in Chattanooga or are thinking about moving there, short-term rentals are one of those things you probably won't think about until they affect you directly. Chattanooga has 9 specific rules on the books covering different aspects of short-term rentals, and some of them might surprise you.

Primary-Residence-Only Rule

Chattanooga splits short-term vacation rentals into two occupancy classes under Sec. 38-85: a homestay, defined as the applicant's primary residence for at least 183 days a year, and an absentee rental, which isn't. Only a homestay can operate in ordinary residential zones; an absentee unit is confined to hotel-permitting commercial zones or a 20-plus-acre parcel.

Key details: Homestay definition: Applicant's primary residence, 183+ days a year. Absentee definition: Not the applicant's primary residence. Homestay zones: Any residential zone in overlay, plus qualifying mixed-use/commercial. Absentee zones: Hotel-permitting commercial zones or 20+ acre parcels. Residency proof: Re-verified annually at renewal, Sec. 38-89(c)(2).

A homestay operator who can't document 183-plus days of residency at renewal risks losing eligibility to hold the certificate at all, since Sec. 38-89(c)(2) makes annual proof of residency a renewal condition rather than a one-time filing. Falsifying that residency claim is grounds for denial, suspension, or revocation of the certificate under Sec. 38-90(c), and a revoked certificate bars any new application for the same property for one year under Sec. 38-90(e)(2).

Compared to other cities, Chattanooga takes a harder line on primary-residence-only rule. The enforcement and penalty structure reflects that.

Noise Rules

Chattanooga requires short-term vacation rental occupants to follow all City noise restrictions, expressly incorporating City Code Section 25-69 into the STR certificate conditions.

Key details: Governing section: § 38-88(j). Incorporates: Cross-references noise code § 25-69. Also covers: Waste management rules. Agent response duty: Agent must respond in 2 hrs.

Noise violations documented against the property count toward the three-strike revocation standard (Sec. 38-90(e)); the STR agent must respond to noise complaints within two hours or face penalties under Sec. 38-92(b)(2).

Occupancy Limits

Chattanooga caps how many bedrooms and how many people a short-term vacation rental can hold. Sec. 38-88(e) limits a unit to five bedrooms for rent, dropping to five sleeping rooms total on sites in the RN-1-6, RN-1-5, or RN-2 zones, and (f) sets the maximum occupancy with a per-bedroom formula that must be posted inside the unit.

Key details: Bedroom cap: 5 bedrooms per dwelling unit. RN-1-6/RN-1-5/RN-2 cap: 5 sleeping rooms total. Occupancy formula: 2 per bedroom to 210 sf, plus 2. Larger bedrooms: Room area divided by 70 sf, plus 2. Posting duty: Maximum occupancy posted conspicuously inside unit.

Exceeding the posted occupancy or bedroom cap is a City Code violation that counts toward the three-strike threshold in Sec. 38-90(e): once a property has three documented violations of City Code or state law tied to the rental's operation, with no appeal rights remaining, the City can revoke the certificate after a public hearing, and revocation blocks a new certificate for that property for one year. A property with even two documented violations in a certification period can be denied renewal outright under Sec. 38-91(d).

Non-owner-occupied 'absentee' short-term rentals are confined to Chattanooga's mixed-use and commercial zones that allow hotels, or to large parcels of 20+ acres under common residential ownership: unlike owner-occupied homestays.

Key details: Governing section: City Code § 38-83. Allowed zones: Hotel-permitting mixed-use/commercial zones. Alternate path: 20+ acre common-ownership parcel. Contrast: Homestay allowed in residential zones.

Operating an absentee rental outside an eligible zone without City review is a zoning violation, and the Development Review and Permitting Division can deny or revoke the certificate.

This is not one of those rules that cities tend to ignore. Chattanooga actively enforces its extended home share requirements.

Short-Term Rental Parking Rules

Chattanooga's short-term vacation rental code requires adequate on-site parking sized to guest count and bars parking on any vegetated part of the lot.

Key details: Governing section: § 38-88(i). Standard: On-site parking required. Sizing: Sized to guest count. Restriction: No parking on vegetated areas.

Failing to provide adequate on-site parking or letting guests park on vegetated areas violates the Minimum Standards (Sec. 38-88(i)) and can be logged as a documented violation counting toward revocation or renewal denial.

Host Presence Rule

Homestay short-term rental applicants must actually live on the property and prove it annually, with a driver's license, business records, or similar proof, to keep their Chattanooga STVR certificate active.

Key details: Governing section: City Code § 38-89(c)(2). Proof required: Driver's license or business records. Frequency: Annually, at renewal. Applies to: Homestay applicants only.

Failing to prove annual on-premises residency can cause the Development Review and Permitting Division to deny renewal or reclassify the unit as an absentee rental subject to stricter zoning.

Taxes & Fees

Chattanooga charges a nonrefundable short-term vacation rental application fee under Sec. 38-89(b): $500 to initially apply or renew an absentee rental, $250 for a homestay. Sec. 38-88(h) separately makes the certificate holder responsible for collecting and remitting every room, occupancy, and sales tax the state and city require.

Key details: Absentee application fee: $500 initial, $500 renewal. Homestay application fee: $250 initial, $250 renewal. Fee refundable?: No, nonrefundable per Sec. 38-89(b)(1). Tax duty: Certificate holder remits room, occupancy, sales taxes. Renewal deadline: Filed 30+ days before expiration.

Operating without paying the application fee in full stops the review before it starts, since Sec. 38-89(b)(2) bars the Development Review and Permitting Division from even reviewing an incomplete-payment file. Failing to collect and remit the room, occupancy, and sales taxes required under Sec. 38-88(h) is a certificate violation that feeds the three-strike revocation standard in Sec. 38-90(e), and a lapsed certificate more than 30 days past expiration cannot be renewed under Sec. 38-91(f), forcing a fresh application and fee.

Repeat Violator Strikes

Chattanooga revokes a short-term vacation rental certificate after three documented Code or state-law violations tied to the rental's operation, barring reapplication for one year.

Key details: Revocation trigger: Revocation after 3 documented violations. Process: Public hearing required first. Reapplication bar: One-year bar on reapplying. Renewal: Renewal denied at 3 violations/year. Discretion: Discretionary denial at 1-2 violations.

Three documented Code or state-law violations trigger mandatory revocation after a hearing (Sec. 38-90(e)); the same threshold forces renewal denial (Sec. 38-91(c)), and even one or two violations can sink a renewal at the City's discretion (Sec. 38-91(d)).

This is not one of those rules that cities tend to ignore. Chattanooga actively enforces its repeat violator strikes requirements.

Short-Term Rental Permits

No one may operate a short-term vacation rental in Chattanooga without first obtaining a certificate from the Development Review and Permitting Division, posted visibly inside the unit.

Key details: Governing section: City Code § 38-87. Issuing office: Development Review & Permitting Division. Must submit: Application + Code Compliance form. Posting: Certificate copy displayed in unit.

Operating without a posted certificate is a City Code violation; documented violations can also block certificate renewal or lead to revocation under Sec. 38-90(e).

Compared to other cities, Chattanooga takes a harder line on short-term rental permits. The enforcement and penalty structure reflects that.

The Bottom Line

Chattanooga is tougher than many cities when it comes to short-term rentals. Out of the 9 rules covered here, 4 are rated strict. If you are a homeowner, renter, or business owner in Chattanooga, take the time to understand these requirements before they become a problem. Most violations come with fines, and some repeat violations can escalate.

All of the above reflects Chattanooga's municipal code as of our last review. If you need specifics on fines, exemptions, or filing requirements, the detailed ordinance pages linked above have the full breakdown.