Overview: Are STRs allowed in Detroit Lakes?

Yes. Short-term rentals are allowed in Detroit Lakes, Minnesota, but only with an active annual license issued by the City of Detroit Lakes. The City’s Short-Term Rental Ordinance (Section 616) explicitly requires licensing for any dwelling or part of a dwelling rented to the public for less than 30 consecutive days, regardless of whether a fee is charged. Licenses must be renewed each calendar year, are nontransferable upon sale, and the City may issue no more than 100 STR licenses in a given year. The license program is designed to protect neighborhood character, reduce nuisance impacts, and ensure health and safety standards.

Detroit Lakes defines three STR types and allows them in both residential and business zoning districts:

• Hosted STR (resident present),
• Un-hosted STR (primary residence, no resident present),
• Dedicated STR (not a primary residence).

Operationally, the City’s rules place clear limits on occupancy, parking, signage, guest conduct, and records, and they incorporate the City’s rental registration inspection process and lodging tax obligations.

How to Start a Short-Term Rental Business in Detroit Lakes

Follow these steps to launch and operate a compliant STR in Detroit Lakes:

1. Confirm zoning eligibility.

• Ensure the property is within City limits and located in a residential or business zoning district (both are allowed for STRs per Section 616).

2. Select the STR type and plan for on-site requirements.

• Choose hosted, un-hosted, or dedicated classification based on whether the unit is your primary residence and whether you will be present.

3. Obtain required local registrations and approvals before applying for the STR license:

• Complete Rental Unit Registration and pass the City’s rental inspection (Section 616.05, 616.06; see City’s rental registration ordinance and inspection checklist resources).
• Register to collect and remit lodging tax (Section 616.05; use City’s lodging tax form and lodging tax ordinance).
• Secure rental liability insurance.

4. Prepare a complete STR license application:

• Owner information and property details (name, address, parcel ID, legal description).
• Property manager details (must reside within 30 miles of Detroit Lakes).
• Number of bedrooms and sleeping areas.
• Building plans (dimensioned/scaled) and a site plan showing setbacks, parking count, and screening.
• STR type selection (hosted, un-hosted, dedicated).
• Proof of lodging tax registration and rental registration/inspection completion.

5. Submit the application and pay the license fee:

• License fees are established by City Council resolution. In 2023, the fee was $350; fees are non-prorated (Section 616.08). Confirm the current fee with the City.

6. Operate in compliance:

• Post the license on the property and include the license number on all print/web ads.
• Adhere to occupancy limits, parking, signage, and guest conduct rules.
• Maintain guest records and provide them to the City upon request.
• Collect and remit lodging tax and maintain required state/local tax registrations.

7. Renew annually:

• Licenses expire each December 31. Re-apply and re-inspect as needed. A change in ownership terminates the license; the new owner must apply.

Required Documents, Permits, Licenses, and Guidelines

To operate a short-term rental in Detroit Lakes, you must maintain:

• City STR License (annual, nontransferable, max 100 licenses per year).
• Proof of lodging tax registration (required before license issuance; ongoing collection/remittance).
• Rental Unit Registration and passing inspection (City’s rental registration ordinance and inspection checklist).
• State and local tax registrations for lodging/sales taxes as applicable.
• Rental liability insurance (evidence of coverage).
• Posted license at the property and license number on all advertising.
• Compliance with City Code 1002 (Dwelling Maintenance) and Section 612 (Rental Registration).

Application contents (Section 616.05):

• Owner name, residence, mailing address.
• Property address and parcel ID; legal description.
• Property manager name, address, phone; must live within 30 miles of Detroit Lakes.
• Number of bedrooms/sleeping areas.
• Dimensioned/scaled building plans.
• Site plan with lot lines and setbacks, parking count, screening elements, adjacent street names.
• STR type (hosted, un-hosted, dedicated).
• Proof of lodging tax registration.
• Proof of rental registration and successful inspection.

Specific STR Regulations in Detroit Lakes (City Code)

The City’s STR ordinance establishes comprehensive operational standards:

• License issuance and cap:

  • No operation without a valid license (616.04).
  • Maximum of 100 STR licenses in a calendar year (616.05).
  • License expires December 31; nontransferable upon sale; 15-day appeal period for denials (616.05, 616.07).
  • Annual license fee set by Council resolution (non-prorated; $350 in 2023) (616.08).

• Zoning and building:

  • STRs allowed in residential and business districts (616.06(14)).
  • Building must be residential in design (616.06(1)).
  • Accessory structures (e.g., guest cottages) may be used only for hosted STRs (616.06(1)).

• Occupancy limits:

  • Maximum two guests per bedroom; maximum 10 guests per STR; children under age 3 do not count toward the cap (616.06(8)).
  • No additional occupancy via RVs, trailers, tents, or other structures (616.06(8)).

• Parking and screening:

  • At least two off-street spaces plus one space per bedroom; screening from adjacent residential properties required per zoning ordinance Section 3 (616.06(6)).

• Signage:

  • One sign, single or double-faced, non-illuminated, no more than 4 square feet per face; content limited to the facility’s name and address (616.06(7)).

• Guest amenities:

  • No cooking facilities in guest bedrooms (616.06(5)).
  • License must disclose to guests: manager contact, emergency numbers, maximum occupancy, property rules (outdoor features), noise ordinance enforcement, prohibition of disorderly behavior, and prohibition on events (616.06(13)).
  • No events permitted at the STR (616.06(12)).

• Insurance and records:

  • Evidence of rental liability insurance required (616.06(9)).
  • Maintain guest records (names, addresses, phone, vehicle plate) and provide to City within 48 hours of request (616.06(11)).

• Inspections and code compliance:

  • Allow inspection by City employees during normal business hours (616.06(10)).
  • Property must meet City Code 1002 (Dwelling Maintenance) and City Code 612 (Rental Registration) (616.06(16)).

• Property manager:

  • Each STR must have a property manager residing within 30 miles of Detroit Lakes (616.06(17)).

• Lodging tax:

  • Register, collect, and remit lodging tax; provide City with state/local sales tax numbers (616.06(4), 616.05(1)).

• Enforcement and penalties:

  • Violations may be enforced via injunctive relief; violations are misdemeanors; administrative fines per City schedule (e.g., $250 first violation; $500 second; $750 third plus automatic revocation for third violation) (616.09).
  • Grounds for revocation include noncompliance with licensing, rental registration, dwelling maintenance, lodging tax, and noise ordinance; disorderly conduct triggers escalating fines and potential revocation (616.09(2), 616.09(3)).
  • After a third violation within one year, license revocation and a one-year ban from obtaining a new STR license apply (616.09(4)(C)).

County and State-Level Notes

Becker County: No separate STR-specific regulations are identified in the provided materials. County-level lodging or taxation requirements, if any, are not documented here and should be confirmed directly with Becker County.

Minnesota (State) Lodging and Taxation: Detroit Lakes requires registration and ongoing collection/remittance of lodging tax for STRs. State-level lodging and sales tax rules apply to Minnesota accommodations and are typically administered through the Minnesota Department of Revenue. Property owners should register for applicable state tax accounts and comply with state statutes and administrative rules governing lodging and sales taxes.

Contact Information (Local Authority in Charge of STRs)

City of Detroit Lakes

• Address: 1025 Roosevelt Avenue, Detroit Lakes, MN 56501
• Phone: 218-847-5658
• Fax: 218-847-8969
• After Hours Emergency: 218-847-7609
• Official Website: cityofdetroitlakes.com/
• Permits, Licenses & Forms: cityofdetroitlakes.com/forms
• Lodging Tax Form (City of Detroit Lakes): laserfiche.ci.detroit-lakes.mn.us/Forms/LodgingTax

Source Links

• City of Detroit Lakes Short-Term Rental Ordinance (Section 616): cityofdetroitlakes.com/vertical/Sites/%7BF991A069-E23D-412C-8132-49318B273050%7D/uploads/Short_Term_Rental_Ordinance.pdf
• City of Detroit Lakes – Rental Registration and Resources (including STR): cityofdetroitlakes.com/index.asp?SEC=E0133DDD-1F8E-4B7B-95F1-1AEFB6F18B1E
• City of Detroit Lakes – Lodging Tax Form: laserfiche.ci.detroit-lakes.mn.us/Forms/LodgingTax
• Detroit Lakes Tribune – First reading approved for new short-term rental ordinance in Detroit Lakes (news context): www.dl-online.com/news/local/first-reading-approved-for-new-short-term-rental-ordinance-in-detroit-lakes-licensing-could-begin-in-2023

Notes for STR investors:

• Build the application around the STR type (hosted/un-hosted/dedicated), parking and screening layout, and guest capacity. The inspection and lodging tax registration steps are mandatory before license issuance.
• License caps (100 per year), nontransferability upon sale, and revocation risk tied to disorderly conduct or code violations make portfolio planning and guest management critical. Maintain an on-call local property manager and robust guest communication to reduce enforcement exposure.