Overview: Are Short-Term Rentals Allowed in Wilmington, NC?

Yes. Short-term rentals are explicitly permitted in Wilmington, North Carolina, subject to comprehensive city regulations adopted in November 2024 that govern permitting, operations, safety, taxation, and advertising. The ordinance defines a short-term rental as all or any portion of a residential dwelling unit advertised or held out to the public for dwelling, lodging, or sleeping with a duration of occupancy of thirty (30) consecutive days or less. Hotels, motels, bed and breakfasts, and other separately regulated uses are excluded.

A critical legal development: on November 21, 2024, City Council passed Ordinance #0509 to regulate STRs, but a prior court decision (Schroeder v. City of Wilmington, 2022) invalidated Wilmington’s earlier registration requirement as preempted by state law. The city has indicated that it will no longer require registration or enforce cap/separation requirements from the previous ordinance and will rely on the new permitting scheme in Article V of Chapter 34. Investors should be aware that the scope of permissible local requirements has been shaped by Schroeder and subsequent statutory constraints (see State-level section below).

How to Start a Short-Term Rental Business in Wilmington

The following step-by-step process outlines the current path to operate a compliant STR in Wilmington:

1. Confirm Property Eligibility and Zoning Fit

• Ensure the proposed dwelling unit meets zoning, building, fire, and health codes.
• Verify any HOA/condo covenants or association bylaws do not expressly prohibit short-term or transient rentals; the city ordinance prohibits STRs in buildings where the HOA/condo documents expressly prohibit them.
• Assess whether your unit is subject to mandatory inclusionary zoning or affordability restrictions; such units are ineligible for an STR permit.
• Confirm you are eligible under ownership rules:
  • Natural persons must be 18 or older.
  • Artificial entities (LLCs, trusts, etc.) may own but are limited to six (6) STR properties.

2. Designate a Local Operator

• Appoint a natural person operator who will be available by phone and able to resolve complaints within three hours during all guest occupancy periods.
• Provide the operator’s name, address, local phone, and email as part of the application.

3. Secure Insurance Coverage

• Maintain at least $1,000,000 in commercial general liability insurance per occurrence (combined single limit) for each dwelling unit used as a short-term rental.

4. Assemble Required Plans and Documentation

• Floor plan: doors, windows, bedrooms (identify guest bedrooms and for non-commercial STRs, the operator’s exclusive bedroom), bathrooms, kitchens, interior doors.
• Evacuation plan: exits, escape routes, smoke detectors, fire extinguishers, carbon monoxide detectors.
• Site plan: required parking location(s).
• Noise abatement plan: at minimum, include a noise monitoring device.
• Sanitation plan: daily visual inspections, regular litter and trash collection, and adequate secure, lidded trash bins.
• Attestation: taxes, property maintenance and building code compliance, working detectors and fire extinguisher, absence of contractual restrictions precluding STR use, adherence to anti-discrimination laws, insurance compliance, and understanding of legal duties.

5. Complete the STR Course

• Provide proof of completion of the city’s short-term rental course (offered virtually and provided by the Department of Land Use and Planning).

6. Submit the Permit Application

• Submit a separate application for each dwelling unit to the Department of Land Use and Planning (city).
• Application must include:
  • Names/ages/contact information of all owners.
  • Municipal address of the STR unit.
  • Total number of dwelling units on the lot-of-record.
  • Operator contact details.
  • All plans and attestation items listed above.
• Permit is valid for one (1) year and must be renewed annually.
• Application fee: $75 per unit.

7. Prepare the Unit and postings

• Display the owner permit in a location clearly visible from the street and legible to neighbors.
• Post inside the unit:
  • Evacuation diagram identifying escapes and means of egress.
  • Trash disposal and recycling collection days.
  • Operator and owner contact information for complaints.

8. Operational Compliance

• Maintain guest registration records (occupancy dates, number of guests, rates, rental income, taxes remitted) for three (3) years.
• Comply with all health, safety, zoning, property maintenance, and building codes.
• Notify guests of trash/recycling days and noise rules.
• Keep the operator available during guest occupancy.

9. Taxes and Fees

• City lodging tax: 2% of rent for every occupancy, collected by the owner and remitted monthly to the Department of Finance within 20 days after the end of each calendar month.
• Annual permit fee: $75 per unit.

10. Advertising Compliance

• Advertise only one (1) dwelling unit per listing.
• Include in all ads:
  • STR permit number.
  • Number of available guest bedrooms.
  • Maximum occupancy.
  • ADA compliance status (wheelchair accessible or compliant).

11. Annual Renewal

• Renew the STR owner permit annually.
• Provide tax and fee reporting for the preceding year and updated platforms/URLs.
• Maintain proof of STR course completion within the prior permit year.

Required Documents, Permits, Licenses, and Guidelines

• STR Owner Permit (annual per unit): $75
• Required plans: floor plan, evacuation plan, site plan (parking), noise abatement plan, sanitation plan
• Insurance: minimum $1,000,000 commercial general liability per occurrence
• STR course completion certificate
• Guest registration record-keeping (3 years)
• Advertising disclosures (permit number, bedrooms, occupancy, ADA status)
• Taxes:
  • City lodging tax: 2% of rent, remitted monthly within 20 days after month-end
  • State lodging tax: applies in addition to city tax under state law

Ineligibility Conditions:

• Outstanding city taxes, fines, fees, or penalties
• Unabated city code violations
• Open construction/renovation/electrical/mechanical permits or open violation cases (unless department approves)
• Property subject to mandatory inclusionary zoning affordability restrictions
• Buildings governed by associations that expressly prohibit short-term/transient rentals

Specific Regulations for Short-Term Rentals in Wilmington, New Hanover County, and North Carolina

City of Wilmington (Local)

• Short-term rental definition: residential dwelling unit rented for 30 consecutive days or less
• Exemptions: hotels, motels, bed and breakfasts, rooming houses; condominiums/co-ops/HOA-governed buildings that expressly prohibit STRs; income-restricted affordable housing; sleeping quarters in vans/RVs; commercial/industrial spaces; non-residential interior areas
• Occupancy: maximum two (2) guests per bedroom
• Density and zoning: STRs must comply with dwelling-unit-per-lot-of-record, guest bedroom limits, guest occupancy limits, and other density limitations in the zoning code
• Minimum standards:
  • No changes that adversely affect the residential character
  • No separate building entrance visible from the street solely for lodging
  • Accessory signs prohibited
  • Compliance with zoning, health, fire, and safety codes
  • Guest notification of trash/recycling days and applicable exterior storage rules
  • Guest notification of noise restrictions and prohibition on noise disturbances
  • Owner/operator contact information for complaint resolution
• Operational restrictions:
  • No large events or commercial uses (e.g., receptions) during guest occupancy; no special event permits obtained for events during occupancy
  • No hourly or less-than-one-night rentals
  • No renting to more than one party at a time
  • No noise disturbances, offensive odors, public drunkenness, unlawful loitering, litter, lewd conduct, or other unreasonable interference with neighbors’ quiet enjoyment
  • Structural load limits for porches, balconies, and roof decks must not be exceeded
  • Discrimination prohibited; compliance with Fair Housing Act (FHA) and Americans with Disabilities Act (ADA)
  • Criminal activity must be reported to police
  • Operators must be available during occupancy; owners and operators must respond to and resolve complaints within three (3) hours
• Safety standards:
  • Working locks on all ingress/egress points
  • Working fire extinguishers, smoke alarms, carbon monoxide detectors
  • Clean and sanitary condition; adequate lighting, ventilation, heating, and cooling
  • Guests provided with clean towels, washcloths, bed linens; dishes and cooking utensils in safe/sanitary condition; perishables disposed of between rentals
• Advertising rules:
  • Single dwelling unit per listing
  • Include permit number, guest bedrooms, maximum occupancy, ADA compliance status
  • No advertising that exceeds zoning or occupancy limits
• Inspections and enforcement:
  • Routine inspections upon request (access within 21 days; 24-hour notice if occupied; extensions possible)
  • Emergency inspections allowed where immediate hazards exist
  • Violations enforceable under City Code section 48-31(a); noise violations enforced per sections 11-58 and 11-59
• Taxes:
  • City lodging tax: 2% of rent
  • Monthly remittance within 20 days after month-end to Department of Finance
  • Additional state lodging taxes apply

New Hanover County (County-level)

County-specific STR regulations were not present in the provided materials. If no separate county STR ordinance exists, county-level requirements are likely limited to generally applicable state and local codes (building, fire, health) administered through the county’s inspection departments. Investors should confirm with the County Building Safety/Inspections Division whether any county-level authorizations or inspections are required for the specific property.

State of North Carolina (State-level)

State law significantly influences local STR regulation:

• Preemption of registration and certain permits: G.S. 160D-1207 prohibits local governments from requiring permits or permissions “under Article 11 or Article 12” (building and housing codes) “to lease or rent residential real property” or from requiring registration of rental property, subject to very limited exceptions (e.g., properties with verified violations or identified crime/disorder problems).
• Zoning and development standards remain permissible: Local governments can define short-term rentals as a land use, limit where they are permitted, and impose reasonable development standards (parking, safety, occupancy, operations), provided such requirements are not structured as registration or Article 11/12 permits to rent.
• Vacation Rental Act: The Vacation Rental Act (Chapter 42A) applies to many STR properties; statutory changes since 2019 have tied STRs into broader rental property inspection/permit/registration limits.
• State lodging taxes: North Carolina imposes a state lodging tax on short-term rentals; these are in addition to any city lodging tax. Operators must register and collect/remit state lodging taxes per the Department of Revenue.
• Legislative context: Proposals like House Bill 911 have sought to limit local bans/permitting for STRs, but such measures require current status verification; the Schroeder decision remains a key interpretative anchor.

Note: North Carolina does not require a state-issued STR permit. Compliance is largely local (zoning and operational standards) plus state tax registration for lodging taxes.

Contact Information (Local Authority)

• City of Wilmington
  • Department of Land Use and Planning (applications and eligibility; inspections coordination)
    • Phone: (910) 762-5810
    • Address: City Hall, 102 North 3rd Street, Wilmington, NC 28401
    • Website: wilmingtonnc.gov
  • Department of Finance (lodging tax remittance)
    • Phone: (910) 762-5810
  • Emergency contact for guests: Non-emergency police line and other postings must be provided inside the unit per ordinance
• New Hanover County
  • County Building Safety/Inspections (confirm county-level requirements)
    • Phone: (910) 798-7133
    • Website: nhcgov.com
• North Carolina Department of Revenue (state lodging tax)
  • Website: dor.nc.gov (search “lodging tax” or “transient accommodations tax”)
  • Phone: (877) 252-3052

Links to Source Pages

• Wilmington City Council Ordinance #0509 establishing STR regulations (Nov 21, 2024): www.wilmingtoncitycouncil.com/wp-content/uploads/2024/11/0509-An-Ordinance-to-Amend-Chapter-34-of-the-City-Code-to-Establish-Short-Term-Residential-Rental-Regulations-W0127053x920B6-1.pdf
• City of Wilmington – Short-Term Lodging (policy updates following court decision; registration and cap/separation removed): wilmingtonnc.gov/departments/planning-development-and-transportation/short-term-lodging
• Municode – Wilmington Code of Ordinances (existing STR provisions; insurance requirement and other rules): library.municode.com/nc/wilmington/codes/code_of_ordinances?nodeId=PTIIITECO_CH18LADECO_ART6SUDERE_DIVIPRCOSPUSPRACUSST_S18-331WHUSLOUSREMUHIDI
• Coates’ Canons (UNC School of Government) – Analysis of short-term rental regulations after Schroeder: canons.sog.unc.edu/2022/04/short-term-rental-regulations-after-schroeder/
• North Carolina General Statutes (Chapter 160D – Planning and Development Regulation; statutory constraints on permits/registration): www.ncleg.gov/EnactedLegislation/Statutes/PDF/ByChapter/Chapter_160D.pdf
• North Carolina Vacation Rental Act (Chapter 42A – context for state statutory coverage): www.ncleg.gov/EnactedLegislation/Statutes/PDF/ByArticle/Chapter_42A/Article_1.pdf

Investors should verify zoning district-specific allowances and any HOA/condo restrictions for each property and ensure alignment with both the new Wilmington ordinance and state-level constraints clarified in Schroeder and G.S. 160D-1207.