10 verified short-term rentals rules for Madison, Alabama, sourced directly from the municipal code and official government pages.
Verified from official government sources
Madison's proposed STR ordinance (No. 2026-201) requires every operator to obtain a Short-Term Rental Operational Permit plus a business license for each unit before renting. Until adopted, the city grants no STR permits and business-license applications for STRs are being denied.
The proposed STR ordinance has no separate decibel limit but bans events and requires a 24/7 local contact who must respond within 30 minutes to any disturbance. STRs must also comply with Madison's general noise ordinance; three substantiated complaints in 12 months suspend the permit.
Alabama levies a state transient occupancy (lodgings) tax of 5% in Madison County, which is part of the Mountain Lakes region, on stays under 180 continuous days. Madison also has a city lodging tax (Code Ch. 10, Art. VIII), and STR operators pay a business-license tax under the city code.
Ala. Code 40-26-1 (Transient Occupancy/Lodgings Tax); Ala. Dept. of Revenue
5% in the following counties: Blount, DeKalb, Lauderdale, Marion, Cherokee, Etowah, Lawrence, Marshall, Colbert, Franklin, Limestone, Morgan, Cullman, Jackson, Madison, and Winston. 4% in all other counties.
The proposed ordinance requires one off-street parking space per bedroom at each STR, subject to on-site availability. Guests must park in the designated parking areas, and overnight street parking by transients is strictly prohibited.
Under the proposed ordinance, no STR may exceed the maximum guest occupancy set by the Building Inspector or Fire Marshal. Only rooms meeting the bedroom definition may be used as guestrooms, and guests per bedroom are determined using adopted building and fire codes.
Madison's proposed ordinance requires a certificate of insurance with at least $1,000,000 in liability and personal-injury coverage, via either a homeowner's-policy rider expressly covering STRs or a commercial STR policy, submitted with the permit application.
Madison's proposed ordinance sets no annual night cap on how many nights an STR may rent. Its main quantity control is a citywide cap of 190 STR permits (0.75% of housing supply), issued first-come, first-served, and permits are annual.
The proposed ordinance requires an application to the Building Department for the STR permit and to the Revenue Department for a business license, with a nonrefundable $350 application fee. Applicants must submit a deed/lease, ID, parking survey, floorplan, insurance certificate, and neighbor list.
Madison's proposed ordinance does not require the host to be present, but every STR must designate a Local Contact Person at least 21 years old with authority to manage the property, available 24/7 and required to respond on-site within 30 minutes of a complaint.
Madison's proposed ordinance does not require an STR to be the host's primary residence. Instead it caps citywide STR permits at 190 (0.75% of housing stock), allows various dwelling types, and restricts STRs to zoning districts approved in the Zoning Ordinance.
County ordinances apply to unincorporated areas and may supplement Madison city rules.
Short-Term Rentals in Madison County →