Chapel Hill, NC Short-Term Rentals: Primary-Residence-Only Rule (2026)

Chapel Hill's short-term rental ordinance, LUMO Sec. 6.27, splits rentals into two categories, 'primary residence' STRs and 'dedicated' STRs, and the purpose section explains why. Sec. 6.27.2(d) states the ordinance exists in part to maintain housing opportunities for full-time residents by preventing the conversion of residential units into dedicated short-term rentals, and Sec. 6.27.2(e) adds the goal of reducing nuisances by prohibiting dedicated short-term rentals in residential neighborhoods and the historic districts. The dividing line between the two categories turns on the Sec. 6.27.3 definition of 'primary residence': a dwelling unit, a single-family dwelling unit with an accessory apartment, or a dwelling unit with an attached duplex unit owned by the same property owner, in which the host resides a majority of the year, specifically 183 days per year or 50 percent or more of the time.

A host who meets that residency threshold can register the property as a primary residence STR, which the purpose section says the town allows in a broader range of places, including mixed-use and commercial districts; a host who does not live in the unit at least 183 days a year is instead operating a 'dedicated STR,' which the purpose language directs the town to keep out of residential neighborhoods and historic districts. In practice, a Chapel Hill homeowner who buys a house purely as an investment property to rent nightly, without living there most of the year, cannot rely on the primary-residence pathway and faces the ordinance's tighter restrictions on dedicated rentals in low-density residential zoning.