Chestertown, Maryland Short Term Rental Regulations Guide for Airbnb hosts

Overview: Are Short-Term Rentals Allowed in Chestertown, MD?

Yes, short-term rentals are explicitly allowed in Chestertown, Maryland. Short-term rental operations are permitted within Kent County and its municipalities, including Chestertown, subject to compliance with applicable county and municipal regulations. The county allows establishments that charge for sleeping accommodations not exceeding 4 consecutive months, with specific tax collection and reporting requirements. Additionally, operators within Chestertown's municipal boundaries must comply with Chestertown Town Code Chapter 138, which includes registration, licensing, and potential additional permitting requirements.

What do Airbnb hosts actually earn in Chestertown?

Chestertown hosts earn a median $32,952/year with $296 ADR and 44% occupancy.

Top performers pull in $49,159+ per year.

See the full Chestertown market breakdown

How to Start a Short-Term Rental Business in Chestertown, MD

Step 1: Understand Your Compliance Framework

Short-term rental operations in Chestertown fall under dual jurisdiction - Kent County regulations and Chestertown municipal requirements. You must comply with both levels of government.

Step 2: State-Level Registration and Licensing

According to state regulations, all short-term rental hosts in Maryland must:

Register with the Maryland Short-Term Rental Commission
Pay an annual $100 licensing fee
Obtain commercial liability insurance coverage of at least $1,000,000
Comply with all applicable building, fire, health, and safety codes

Step 3: County-Level Tax Registration

Contact the Kent County Office of Finance at (410) 778-7478 or financeinfo@kentgov.org
Request your account number and activation code for the online tax portal
Set up your Short Term Rental Tax Portal account at kentcountymd.munirevs.com/

Step 4: Municipal Registration (Chestertown)

Contact the Town of Chestertown at (410) 778-0500 or office@chestertown.com
Request specific requirements under Town Code Chapter 138
Obtain any required municipal registration, permits, and licenses

Step 5: Ongoing Compliance

Collect applicable taxes (6% state sales tax + 4% Kent County lodging tax)
File monthly tax reports by the 21st of each month
Maintain separate reporting for each lodging establishment if you own multiple properties

Required Documents, Permits, Licenses, and Guidelines

State-Level Requirements

Maryland Short-Term Rental Commission registration
Annual state license ($100 fee)
Commercial liability insurance ($1,000,000 minimum)
Compliance certificates for building, fire, health, and safety codes

Kent County Requirements

County tax registration through Office of Finance
Monthly Short Term Rental Tax Reports
Guest billing that separately identifies short-term rental tax charges
Separate tax reports for each lodging establishment

Chestertown Municipal Requirements

Municipal registration and licensing under Town Code Chapter 138
Additional permits and licenses as required by the municipality
Compliance with any local zoning and safety regulations

Documentation Checklist

State registration and licensing certificates
Commercial liability insurance policy
County tax registration confirmation
Municipal permits and licenses
Property compliance certificates
Tax collection and reporting procedures documentation

Specific Regulations for Short-Term Rentals

Kent County Regulations (Chapter 152 Taxation, Article III)

Tax Collection Requirements:

Short-term rental tax must be collected on all charges for sleeping accommodations not exceeding 4 consecutive months
Tax must be separately identified on guest bills
Tax collection from paying guests is mandatory

Reporting and Remittance:

Monthly Short Term Rental Tax Report must be completed
Tax remittance due by the 21st of each month
Separate reports required for each lodging establishment
Late payment interest and penalties may apply (except waived for July 2024 due to system conversion)

Exemptions:

Nonprofits or governmental associations exempt from sales & use tax are NOT exempt from short-term rental tax

Chestertown Municipal Regulations

Governed by Town Code Chapter 138
Registration and licensing requirements apply
Additional permitting may be required
Municipal regulatory language is subject to updates and revisions
Specific fees, inspections, or restrictions may apply

State of Maryland Regulations

6% state sales tax on all short-term rentals of 88 nights or less
Registration with Maryland Short-Term Rental Commission
Compliance with building, fire, health, and safety codes
Commercial liability insurance requirements

Tax Structure

State Sales Tax: 6% on rentals ≤ 88 nights
Kent County Lodging Tax: 4%
Total Tax Rate: 10% on applicable short-term rentals

Contact Information

Kent County Office of Finance (County-Level STR Tax Administration)

Physical Address:

400 High Street, 2nd Floor, Chestertown, MD 21620

Phone: (410) 778-7478

Email: financeinfo@kentgov.org

Online Portal: kentcountymd.munirevs.com/

Hours of Operation:

Monday-Friday: 8:30 AM - 4:30 PM

Chestertown Municipal Authority

Physical Address: Contact municipality for address

Phone: (410) 778-0500

Email: office@chestertown.com

Regulatory Authority: Town Code Chapter 138

Other Kent County Municipalities (for comparison)

Betterton: info@townofbetterton.com, (410) 348-5522
Galena: info@townofgalena.com, (410) 648-5151
Millington: millington@millingtonmd.us, (410) 928-3880
Rock Hall: cbutler@rockhallmd.gov, (410) 639-7611

Important Considerations for STR Investors

Market Performance

Chestertown demonstrates a thriving short-term rental market with:

Average 45% occupancy rate
Average daily rate of $410
Peak seasons during summer and fall
Revenue surges during local events (Tea Party Festival, Sultana Downrigging Weekend)

Municipal Compliance

Properties within Chestertown municipal boundaries must comply with both county and municipal requirements
Municipal regulations may include additional fees, inspections, or operational restrictions
Stay informed about regulatory updates through municipal communications

Additional Regulatory Considerations

Homeowners Association (HOA) or Condo Association restrictions may apply
Compliance with zoning laws is mandatory
Safety and habitability standards must be maintained
Regular monitoring of regulatory changes is recommended

Source Links

Kent County Finance Department STR Information: www.kentcounty.com/government/departments/finance/short_term_rental_information
Kent County STR Portal: www.kentcountymd.munirevs.com/
RedAwning Chestertown Market Overview: www.redawning.com/pm/market-overview/chestertown-maryland
Chestertown Municipal Contact: office@chestertown.com
Kent County Office of Finance: financeinfo@kentgov.org, (410) 778-7478

Note: This guide reflects regulations as of the information sources provided. Investors should verify current requirements with local authorities before commencing operations, as regulations may be updated or revised.

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Ask the AI Advisor about Chestertown

Chestertown is a small historic town in Kent County, Maryland, set on the banks of the Chester River on the state's Eastern Shore. With a population of roughly 5,000, it has the feel of a quiet, walkable college town layered over a deep colonial past, with brick sidewalks, restored 18th-century storefronts, and a waterfront that draws sailors, birders, and weekenders. The town is best known as one of the oldest ports in Maryland and as the home of Washington College, and it serves as a gateway to the broader Eastern Shore's farms, rivers, and Chesapeake Bay shoreline. It sits about 75 miles east of both Baltimore and Washington, D.C., reached by a scenic drive across the Chesapeake Bay Bridge and through the rural landscapes of Queen Anne's and Kent counties.

The historic downtown is the town's centerpiece, a compact grid of Georgian and Federal-era buildings clustered around a central park and the river. Many of the structures date to the late 1700s and early 1800s, and the district is on the National Register of Historic Places, giving visitors an unusually intact sense of what a colonial Chesapeake port once looked like. Independent bookstores, antique shops, and waterfront restaurants fill the old storefronts, and a weekly farmers' market and seasonal festivals keep the streets lively through much of the year.

A short walk from the center of town, Washington College anchors Chestertown's intellectual and cultural life. Founded in 1782, it is the tenth-oldest college in the United States and counts George Washington as a benefactor, with a surviving letter of thanks on campus. Its riverside grounds, public lectures, art exhibitions, and athletic events draw visitors who might not otherwise make the drive out to the Eastern Shore.

Just south of town, Eastern Neck National Wildlife Refuge covers most of a low-lying island at the mouth of the Chester River where it meets the Chesapeake Bay. About a 20-minute drive from downtown, the refuge protects more than 2,000 acres of tidal marsh, forested swamp, and farmland and is a major stopover for migratory waterfowl, bald eagles, and, in summer, nesting ospreys. A short drive-and-walk loop offers easy access for casual visitors, while longer paddling routes appeal to kayakers.

For travelers, Chestertown is a natural base for exploring the upper Eastern Shore, with the Sassafras River, the small harbor town of Rock Hall, and the Chesapeake Bay beaches near Betterton all within roughly a half hour. That mix of preserved history, a real college-town rhythm, and easy access to some of the most unspoiled bay shoreline in Maryland gives the town a steady, year-round appeal that translates well into short-term-rental demand from history-minded weekenders, parents visiting students, and travelers building a longer Eastern Shore loop.