Overview: Are Short-Term Rentals Allowed in Paterson, NJ?

Explicit answer: Based on the most current official city document available (April 2016 zoning code), Paterson, NJ does not have a dedicated short‑term rental (STR) ordinance. BuildYourBnb’s 2021 analysis likewise finds “no specific mention of STRs in the city’s code of ordinances,” classifying Paterson’s STR regime as “not regulated” at the city level. Short‑term rentals operating for fewer than 30 days are therefore permitted in the city, subject to baseline zoning use categories, the state’s Uniform Construction Code (UCC), and general safety standards (e.g., smoke/CO detectors, fire extinguishers). Note that city officials have publicly indicated plans to introduce a tiered STR licensing system in 2026, but this is anticipated and not yet enacted.

Bottom line for investors: Under current city law, you can operate an STR in Paterson without a city‑specific license, provided you comply with the property’s zoning, New Jersey’s building and safety codes, and state tax obligations. Monitor city communications closely for any 2026 licensing or occupancy rules that may be adopted.

How to Start a Short-Term Rental Business in Paterson

• Confirm zoning eligibility:
  • Verify that “lodging/hotel/boarding house” and related uses are allowed in the district where your property sits (Chapter 483 zoning ordinance).
  • For owner‑occupied Bed & Breakfast (B&B) uses, the code recognizes and licenses this as an owner‑occupied single‑family residence providing lodging and meals; it must meet all local and state codes for health, safety, and zoning. If you intend to operate a non‑owner‑occupied B&B or “inn/hostel/boarding,” confirm whether it is a permitted principal, conditional, or prohibited use in the district.
  • Where unclear, consult the Paterson Zoning Map, the Schedule of Permitted Uses, and the city’s Zoning Officer for interpretations or variances.
• Use and occupancy compliance:
  • Confirm the property’s current Certificate of Occupancy (CO) describes “lodging” or “residential” use consistent with your plan. If you plan to convert a unit to STR use, the Division of Community Improvements issues COs; coordinate any change-of-use with their office.
• Build and safety standards:
  • Comply with New Jersey’s Uniform Construction Code (UCC) and life-safety requirements. Hosts commonly adopt best‑practice safety measures: smoke detectors in every bedroom and common area, carbon monoxide detectors on each floor, and accessible fire extinguishers; posted emergency exits and guest safety instructions are recommended.
• Taxes:
  • Register for and collect New Jersey’s 6.625% state sales tax on STR bookings (remit quarterly to the NJ Division of Taxation). Sales tax applies to most short‑term rentals.
  • Confirm whether Paterson levies a local occupancy or lodging tax on stays under 30 days with the City Clerk’s office or Division of Community Improvements; sources do not provide the definitive rate or collection process.
• Tenant and property constraints:
  • Where you do not own the fee‑simple interest (e.g., rent‑controlled units or tenant sublets), check lease and municipal rules; other NJ municipalities (e.g., Jersey City) restrict tenants and rent‑controlled units, and investors should treat these as red flags in Paterson as well.
• Exemptions and special districts:
  • Historic districts and flood hazard areas (see Chapter 483, Article V Zoning and §500‑11 Flood Damage Prevention) may carry additional review, permits, or restrictions. Confirm whether your property lies in a designated historic district or regulated flood zone.
• Launch readiness:
  • Implement guest screening, house rules (quiet hours, occupancy limits), on‑site or 24‑hour contact protocols, and parking plans to minimize neighbor complaints and code issues.

Required Documents, Permits, Licenses, and Guidelines

• Municipality (City of Paterson):
  • Zoning permit and site plan approvals may be required depending on the scope of work and use classification.
  • Construction Permit and Certificate of Occupancy (CO) from the Division of Community Improvements when changing use or renovating to meet safety/life‑safety standards.
  • Annual CO renewals, inspections, and compliance with the city’s UCC enforcement.
• State of New Jersey:
  • UCC compliance (safety devices, egress, and building standards).
• Insurance:
  • General liability coverage is strongly recommended (often ≥ $500,000), particularly if you expect to obtain city licensing or host larger groups.
• Taxes:
  • NJ Sales Tax registration and quarterly filings (6.625% state sales tax applies).
  • Confirm any local occupancy/lodging tax registration or filing with the City of Paterson.
• Good practice (not mandatory absent future city rules):
  • Guest registration logs, safety information, evacuation plans, and 24/7 local contact details.

Note: As of the latest official text available (2016), no city‑issued STR business license is required. Expect licensing requirements if 2026 reforms are adopted.

Specific Regulations (City, County, State)

City of Paterson (Chapter 483 – Zoning and Land Development Ordinance; April 2016)

• No dedicated STR ordinance. STRs are generally permitted subject to underlying zoning classification and the lodging/boardinghouse framework.
• Bed & Breakfast is defined as owner‑occupied single‑family lodging with meals; must be licensed and meet all applicable codes.
• Zoning:
  • Confirm allowed use status for lodging/hotel/boarding/hostel in the relevant district (permitted principal, conditional, or prohibited).
  • B‑1/B‑2 commercial districts include provisions for residential uses; mixed‑use is allowed in certain districts; verify your use within the permitted use schedule.
  • IT, GFH, R/C‑3 and other districts have district‑specific rules; consult Schedule of Permitted Uses and district standards.
• Parking and loading:
  • Off‑street parking requirements apply; confirm required spaces per unit and loading standards (§500‑7).
• Historic Preservation:
  • Projects in locally designated historic districts or sites may require Historic Preservation Commission review and design approvals (Article III, §§300‑13 and §500‑3.18 GFH district specifics).
• Flood Damage Prevention:
  • Properties in flood hazard areas must meet floodproofing and elevation requirements (§500‑11).
• Administration and enforcement:
  • Zoning permits, CO issuance, inspections, variance/conditional use processes, and penalties are governed by Articles III–IV. The Division of Community Improvements administers construction/UCC permits and COs; the Division of Planning and Zoning administers zoning matters.

Passaic County

• County‑level STR rules are not identified in the provided sources. County government involvement typically arises through health, fire, and building departments only when triggered by construction, life‑safety, or specific code provisions. Investors should confirm any county inspections or approvals if substantial renovations are planned.

State of New Jersey

• Sales Tax:
  • 6.625% sales tax applies to short‑term rentals (most transient lodgings). Registration and quarterly remittance are required through the NJ Division of Taxation.
• Uniform Construction Code (UCC):
  • New Jersey’s UCC governs building safety, inspections, and life‑safety compliance.
• Municipal Land Use Law (MLUL):
  • The zoning ordinance’s authority and interpretation are grounded in the MLUL (N.J.S.A. 40:55D‑1 et seq.), including variance and conditional use procedures.
• Anticipated changes:
  • City officials have signaled a tiered licensing system for 2026 with occupancy limits, inspections, and insurance standards. Treat this as directional and monitor official releases.

Zoning quick‑reference (high‑level)

• Allowed lodging/boardinghouse uses vary by district; verify with the Schedule of Permitted Uses.
• B‑1/B‑2: Mixed residential/commercial allowances may be relevant to STR conversions.
• Historic districts and flood hazard areas may impose additional constraints.
• Off‑street parking and loading standards may affect operational plans.

Contact Information (Local Authority in Charge of STRs)

• City of Paterson – Division of Community Improvements (Construction/UCC, COs)
  • Website: www.patersonnj.gov/
• City of Paterson – Division of Planning and Zoning (Zoning, permits, interpretations)
  • Website: www.patersonnj.gov/
• City Clerk’s Office
  • Website: www.patersonnj.gov/
• New Jersey Division of Taxation (Sales tax registration and filings)
  • Website: www.state.nj.us/treasury/taxation/
• New Jersey Department of Community Affairs – Uniform Construction Code
  • Website: www.nj.gov/dca/divisions/codes/

Note: The sources do not provide phone or email contacts for Paterson’s STR oversight. Use the city website portal for department directories and to submit inquiries.

Links to Source Pages

• www.jakenfinancegroup.com/paterson-short-term-rental-laws-2026-a-complete-guide
• www.hostaway.com/blog/airbnb-rules-in-new-jersey/
• www.buildyourbnb.com/us-airbnb-and-short-term-rental-regulations/paterson
• www.patersonnj.gov/egov/documents/1463422578_02635.pdf

Disclaimer: The zoning ordinance cited is from April 2016 and may not reflect amendments adopted since then. The 2026 licensing references are anticipated reforms, not codified rules. Always verify current requirements with the City of Paterson and the New Jersey Division of Taxation before investing or launching operations.