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Arroyo Hondo, NM

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STR Regulations for Arroyo Hondo, New Mexico

Important caveat up front: Arroyo Hondo is an unincorporated community in Taos County, and it is also listed as a Census Designated Place (CDP) within Santa Fe County’s jurisdictional boundary. This means your property could be subject to either Taos County rules or Santa Fe County rules depending on which county actually governs your parcel. Confirm your parcel’s county before proceeding.

Overview: Are STRs allowed in Arroyo Hondo?

Yes—short-term rentals are allowed in Arroyo Hondo, but the specific framework and limits depend on which county your property sits in.

  • If your property is in Taos County (most likely): STRs are allowed under Ordinance 2024-4, which took effect October 19, 2024. The County is accepting applications and will regulate non-owner-occupied and owner-occupied STRs. A hard cap of 3% of total housing stock is placed on the number of Non‑Owner‑Occupied STRs allowed in the Arroyo Hondo CDP in Santa Fe County (if your parcel is governed by Santa Fe County; see immediately below). [Taos County Ordinance 2024‑4] [Taos County STR page].
  • If your property is in Santa Fe County (Arroyo Hondo CDP): STRs are allowed only in dwellings on a Legal Lot of Record, and Non‑Owner‑Occupied STRs are capped at 3% of total housing stock in the Arroyo Hondo CDP. Owner‑Occupied STRs are capped at one per owner. [Santa Fe County Ordinance 2022‑07 FAQ].

Bottom line: If your parcel is in Taos County, you are under Taos County’s new STR ordinance and permitting; if your parcel is in Santa Fe County’s Arroyo Hondo CDP, you are under Santa Fe County’s cap and licensing regime.

What do Airbnb hosts actually earn in Arroyo Hondo?

Arroyo Hondo hosts earn a median $29,939/year with $193 ADR and 61% occupancy.

Top performers pull in $49,343+ per year.

See the full Arroyo Hondo market breakdown

How to start a short-term rental business in this market

  1. Confirm county jurisdiction: Pull your parcel number from the county assessor (Santa Fe County Assessor; Taos County GIS/Assessor) to verify whether your property lies in Taos County or Santa Fe County. This determines whether you follow Taos County Ordinance 2024-4 or Santa Fe County Ordinance 2022-07. [Santa Fe County STR FAQ] [Taos County STR page].

  2. Check HOA/deed restrictions: While New Mexico case law has limited the ability of HOAs or deed restrictions to prohibit STRs purely on the basis of “commercial” use, many HOAs can still restrict or penalize STR activity via covenants. Review your HOA bylaws and covenants; if you have deed restrictions, consult legal counsel to interpret enforceability. [Swan Realty blog: deed/HOA restrictions].

  3. Verify property and zoning eligibility:

  • Taos County: STRs are regulated in unincorporated areas under Ordinance 2024-4. Confirm zoning allows residential uses and that your structure is a lawful dwelling unit. Review fire department occupancy requirements before submitting. [Taos County STR page].
  • Santa Fe County: Only structures that qualify as a “Dwelling” under the Sustainable Land Development Code (SLDC) and on a Legal Lot of Record may be used for STRs. Accessory Dwelling Units (ADUs) must meet SLDC standards; non-conforming structures built before 1981 may be lawful but require confirmation and permitting where necessary. [Santa Fe County STR FAQ].
  1. Plan for entitlements, if needed:
  • If you have unpermitted structures (e.g., converted garages/studios), obtain proper permitting before applying. In Santa Fe County, you may need “after-the-fact” permits; accessory dwellings require compliance with SLDC 10.4 standards or a variance process. [Santa Fe County STR FAQ].
  • In Santa Fe County, if your structure cannot meet accessory dwelling standards, consider a zoning variance. Variances require public hearing review by the Planning Commission, carry conditions, and expire within one year if not acted upon. [Santa Fe County STR FAQ].
  1. Prepare and submit your application:
  • Taos County: Submit the “Short Term Rental Permit Application” (zoning clearance) plus required attachments by email to str.application@taoscountynm.gov or in person at Taos County Planning. Applications require proof of rural addressing, fire department occupancy compliance, business registration, lodging establishment application, and affidavits. [Taos County STR page].
  • Santa Fe County: Submit to the Growth Management Department; you can email your package to STR@santafecountynm.gov or schedule an appointment (505-995-2700). You must include all required documents (site plan, floor plan, proof of primary residence, deed/survey plat, tax certificate, fire self-certification, 911 address, neighbor notices/affidavit, NM CRS number, water meter reading for non-owner-occupied). [Santa Fe County STR FAQ].
  1. Complete neighbor notification and post required notices:
  • Santa Fe County: You must mail notices to adjacent property owners (and HOA, if applicable) and file an affidavit of mailing. Post the “Business Notice to Renters” inside the unit. Provide a 24‑hour contact on all notices. [Santa Fe County STR FAQ].
  • Taos County: Confirm the current affidavit and notice requirements in your permit packet and checklist. [Taos County STR page].
  1. Register and tax:
  • Obtain a New Mexico Combined Reporting System (CRS) number for gross receipts tax reporting on lodging income (state-level requirement). [Santa Fe County STR FAQ].
  • For Santa Fe County, pay annual license/registration fees and renewals per schedule (Owner‑Occupied registration renews via the Treasurer’s Office; Non‑Owner‑Occupied license renews through Building & Development Services). [Santa Fe County STR FAQ].
  1. Prepare for operations:
  • Display the Business Notice to Renters (Santa Fe County).
  • Cap occupancy per county rules.
  • Maintain designated parking and trash storage areas, per site plan.
  • Keep a current 24‑hour local contact and respond promptly to complaints.
  • For Santa Fe County Non‑Owner‑Occupied STRs, track annual renewals and any monitoring/inspections.

Required documents, permits, licenses, and guidelines

A. Taos County (Unincorporated Areas)

  • Short Term Rental Permit Application (zoning clearance). [Taos County STR page].
  • Rural Addressing Application (assigned 911 address). [Taos County Rural Addressing Application].
  • Fire Department Requirements for Residential Occupancy (safety compliance). [Taos County Fire Dept Requirements].
  • Application for New Business Registration. [Taos County Business Registration].
  • Lodging Establishment Application. [Taos County Lodging Establishment Application].
  • Affidavit of Compliance (owner-occupied or non-owner-occupied, as applicable). [Taos County Affidavits].
  • STR Owner Permission Statement (if required in your packet). [Taos County STR Owner Permission].
  • Contact and location information suitable for a 24‑hour response for renters and neighbors (ensure the contact person can respond to noise/disturbance complaints).
  • Any additional documentation required by the Planning Department (checklists are updated periodically). [Taos County STR page].

B. Santa Fe County (Arroyo Hondo CDP)

  • Application for Owner‑Occupied STR Business Registration or Non‑Owner‑Occupied STR Business License (via Growth Management Department). Email submissions to STR@santafecountynm.gov or call 505-995-2700. [Santa Fe County STR FAQ].
  • Site Plan showing all structures, driveway, designated parking spaces, and solid waste storage (can be a hand-annotated satellite/aerial map). Parking spaces cannot include double/stacked parking or undesignated areas. [Santa Fe County STR FAQ].
  • Floor Plan highlighting the STR area, entrances/exits, and approximate square footage (hand-drawn is acceptable). [Santa Fe County STR FAQ].
  • Proof of Primary Residence (owner-occupied only). Any one of: utility bill, voter registration, motor vehicle registration, state ID, W‑2, or bank statement showing the property address. [Santa Fe County STR FAQ].
  • Deed and Survey Plat (Legal Lot of Record proof). Obtain via Santa Fe County Clerk, 100 Catron Street; $1 per printed page. [Santa Fe County STR FAQ].
  • Proof of Property Taxes (tax certificate from Treasurer’s Office; treasurer@santafecountynm.gov or 505-986-6245). [Santa Fe County STR FAQ].
  • Fire Self-Certification Form (no Fire Dept approval required; sign and bring to appointment). [Santa Fe County STR FAQ].
  • Assigned 911 Address Form (request via mjurgens@santafecountynm.gov). [Santa Fe County STR FAQ].
  • Neighbor Notification Letters and Affidavit of Mailing (adjacent owners and HOA). A 24‑hour STR contact is required. Staff can provide envelopes/postage for a fee. [Santa Fe County STR FAQ].
  • New Mexico State CRS Number (register with NM Taxation & Revenue; CRS ID for gross receipts tax reporting; 505-827-0700). [Santa Fe County STR FAQ].
  • Water Meter Reading (Non‑Owner‑Occupied only) if subject to a water restriction; install a meter if missing and provide the starting reading. [Santa Fe County STR FAQ].
  • Business License/Registration Fees (see Fees section).
  • Business Notice to Renters (to be posted in the STR at all times). [Santa Fe County STR FAQ].

State-level (New Mexico)

  • State CRS Number (Combined Reporting System) for gross receipts tax on lodging income. [Santa Fe County STR FAQ].

Specific regulations for STRs (city, county, and state)

Definitions

  • Santa Fe County: “Short‑term rental” means a dwelling or portion thereof rented for fewer than 30 consecutive days. Owner‑Occupied STR is an STR that is the owner’s primary residence or an ADU on the same lot as the owner’s primary residence. Non‑Owner‑Occupied STR is an STR that is not owner‑occupied. [Santa Fe County STR FAQ].
  • Santa Fe County: “Dwelling” is a structure designed/occupied/intended as living quarters for a family, including facilities for cooking, sleeping, and sanitation; excludes recreational vehicles, travel trailers, hotels, motels, boardinghouses. [Santa Fe County STR FAQ].

Where STRs are allowed

  • Santa Fe County: STRs are allowed only on a Legal Lot of Record and within a dwelling legally recognized under the SLDC. Recreational vehicles, yurts, tents, tepees, and mobile tiny homes are not allowed as STRs (they may be permitted under separate “camping” use categories, not as STRs). [Santa Fe County STR FAQ].
  • Santa Fe County: STRs are allowed in zoning districts where residential uses are permitted. [Santa Fe County STR FAQ].
  • Taos County: Ordinance 2024‑4 governs STRs in unincorporated areas; zoning clearance is required and the STR must comply with occupancy and fire safety standards. [Taos County STR page] [Taos County Ordinance 2024‑4].

Occupancy limits

  • Santa Fe County: Two people per approved bedroom, up to a total of ten (10) people. Licenses/registrations existing as of the effective date that exceed ten may continue under the same owner, but any change of ownership must meet the ten‑person cap. [Santa Fe County STR FAQ].
  • Taos County: Occupancy and safety standards are governed by the Fire Department Requirements for Residential Occupancy (refer to the County’s packet and FAQs). [Taos County STR page].

Caps on number of Non‑Owner‑Occupied STRs

  • Santa Fe County (Arroyo Hondo CDP): Non‑Owner‑Occupied STRs are limited to 3% of total housing stock. Owner‑Occupied STRs are limited to one per owner. [Santa Fe County STR FAQ].
  • Taos County: The provided material references a new permitting process under Ordinance 2024‑4 but does not specify an across‑the‑board cap like Santa Fe County’s. Confirm with the Planning Department whether any local area caps apply. [Taos County STR page].

Permitting process and renewal

  • Santa Fe County:
    • Owner‑Occupied: Annual business registration valid for one calendar year; renew via the County Treasurer’s Office by paying the $35 fee before January 1 each year. [Santa Fe County STR FAQ].
    • Non‑Owner‑Occupied: Annual business license valid for one year; initial fee $375; renewal $300. Reapplication is required each year through the Building & Development Services Division. [Santa Fe County STR FAQ].
    • Applications can be emailed to STR@santafecountynm.gov or processed via appointment (505-995-2700). [Santa Fe County STR FAQ].
  • Taos County: Submit the zoning clearance application and attachments (see Required Documents). Applications can be emailed to str.application@taoscountynm.gov or submitted in person. Confirm the current processing timeline and any required renewals with the Planning Department. [Taos County STR page].

Neighbor notification and posting

  • Santa Fe County: Required mail notice to adjacent owners and HOA (if applicable) with an affidavit of mailing; you can obtain envelopes/postage through staff for a fee. Post the Business Notice to Renters inside the unit. Provide a 24‑hour contact. [Santa Fe County STR FAQ].
  • Taos County: Use the County’s current affidavit and notice forms per your packet and checklist; ensure a 24‑hour response contact is available. [Taos County STR page].

Accessory Dwellings (Santa Fe County)

  • ADUs allowed under SLDC 10.4: one per legal lot of record; must meet setbacks; cannot exceed 50% of the heated floor area of the principal residence (max 1,400 sq ft); single story; same architectural style; shared driveway and utilities (including septic; NMED allows separate tanks with a joined leach field). If you cannot meet standards, consider a variance (public hearing, Planning Commission). [Santa Fe County STR FAQ].

Variances (Santa Fe County)

  • Variances require strict review criteria and may be granted only by the Planning Commission; they cannot authorize prohibited uses, expire within one year if not implemented, and may carry conditions. [Santa Fe County STR FAQ].

Non‑conforming/“after‑the‑fact” structures

  • Structures built without permits before 1981 may be considered “legal non‑conforming.” Structures built without permits after that generally require “after‑the‑fact” permitting before STR licensing/registration. Contact Growth Management (505-995-2700) to start this process. [Santa Fe County STR FAQ].

HOA and deed restrictions

  • While New Mexico case law has allowed short‑term rentals in the face of restrictive covenants that sought to label STRs as “commercial” or “business” use, HOAs can still enforce rules, fines, or penalties under their covenants. Always review your HOA documents and consult counsel. [Swan Realty blog: deed/HOA restrictions].

Gross receipts tax

  • All STRs conducting business in New Mexico must register for a State CRS Number and report gross receipts tax on lodging revenue. [Santa Fe County STR FAQ].

Complaints and enforcement

  • Taos County: Report a Concern line (575) 741‑2713 and online complaint portal (host compliance). For inquiries about STR regulations or applications: (575) 737‑6440; str.application@taoscountynm.gov. [Taos County STR page].
  • Santa Fe County: Applications are handled through Growth Management; any enforcement actions would be coordinated through that department (contact 505-995-2700). [Santa Fe County STR FAQ].

Contact information (local authority in charge of STRs)

  • Taos County Planning Department
    • Phone: (575) 737‑6440
    • Email: str.application@taoscountynm.gov
    • Physical address: 105 Albright Street, Suite H, Taos, NM 87571
    • Complaint line: (575) 741‑2713
    • Online complaint portal: see Taos County STR page
    • Ordinance: 2024‑4 (effective Oct 19, 2024)
    • Forms/apps: See “Applications and Forms” on the STR page
    • Rural addressing application

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Arroyo Hondo

Market Saturation Score

036912
Moderate Saturation
7/ 12
months with declining YoY revenue
5–7 declining months: moderate saturation risk - market may be nearing capacity.
View Full Arroyo Hondo Market Analysis

Photos of Arroyo Hondo

Overview of Arroyo Hondo

Arroyo Hondo is a small, rural unincorporated community nestled in Taos County in northern New Mexico, along the Rio Hondo in the foothills of the Sangre de Cristo Mountains. With a population of only a few hundred residents, Arroyo Hondo has a quiet, off-the-beaten-path character defined by open high desert landscapes, big mountain views, and a deep sense of Northern New Mexico cultural heritage. It is best known as a peaceful stopover between the artistic haven of Taos and the historic capital of Santa Fe, and as a jumping-off point for exploring the Sangre de Cristo range, the Rio Grande Gorge, and the surrounding Carson National Forest. The community sits roughly 80 to 85 miles north of Santa Fe, the nearest major city, along a scenic stretch of US Route 64 that winds through the region's most photographed terrain.

Just a short drive north of Arroyo Hondo, the Taos Pueblo stands as one of the oldest continuously inhabited communities in the United States and a UNESCO World Heritage Site. Approximately 10 to 15 miles from Arroyo Hondo, this living adobe village offers visitors a rare glimpse into centuries-old Pueblo traditions, with multi-storied dwellings, traditional ceremonies, and a rich cultural heritage that has endured for nearly a millennium.

A little farther northeast of the community, the Carson National Forest blankets much of the surrounding mountain landscape with hiking trails, alpine meadows, and dense stands of aspen and conifer. Depending on the specific trailhead, visitors can reach popular areas such as the trail leading toward Wheeler Peak, the highest point in New Mexico, in roughly an hour's drive from Arroyo Hondo, making the area a year-round base for hiking, wildlife watching, and in winter, backcountry skiing and snowshoeing.

To the west, the Rio Grande Gorge carves a dramatic chasm through the volcanic plateau, with the iconic Rio Grande Gorge Bridge serving as a major scenic landmark about 20 to 25 minutes from Arroyo Hondo. The gorge draws visitors for hiking, whitewater rafting in the river below, and stargazing in one of the clearest night-sky regions in the country. The surrounding area is part of the greater Taos region, which has long attracted artists, outdoor enthusiasts, and travelers seeking a blend of Native American, Hispanic, and Anglo cultural traditions.

Arroyo Hondo appeals to short-term rental owners because it offers something increasingly rare in the Taos area: genuine quiet, dark skies, and proximity to some of Northern New Mexico's most celebrated destinations. Guests can spend their days exploring Taos Pueblo, skiing at Taos Ski Valley, hiking in Carson National Forest, or watching the sunset over the Rio Grande Gorge, and return each evening to a tranquil rural setting away from the busier tourist centers. For travelers who want to experience the high desert, mountain culture, and small-village atmosphere of north-central New Mexico, Arroyo Hondo makes a memorable and well-positioned home base.

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