Overview: STR Status in Covington, VA

Yes, short-term rentals are explicitly allowed in Covington, Virginia and Alleghany County. The local government has actively developed specific zoning regulations for short-term rentals (STRs), with a proposed framework allowing these rentals with certain restrictions and requirements. Covington operates in a low-regulation environment for STRs, presenting opportunities for investors while requiring compliance with established zoning and registration procedures.

How to Start a Short-Term Rental Business in Covington, VA

Step-by-Step Process

1. Property Acquisition & Zoning Verification

   • Purchase or identify a suitable property in an appropriate zoning district
   • Confirm STRs are permitted in your specific zone:
     • AR (Agricultural Residential): Allowed by right
     • R-2 (Residential): Requires special use permit
     • R-1 (Residential): Not permitted

2. Application Process

   • Complete and submit a short-term rental application to the Alleghany County Zoning Office
   • Application must be approved before operation begins

3. Registration Requirements

   • Register with the Commissioner of the Revenue
   • Complete all standard business registration requirements

4. Compliance Verification

   • Ensure all property codes are met (building permits, septic systems, etc.)
   • Maintain compliance with residential structure standards

Market Entry Strategy

Based on current market analysis:

• 31 active listings currently in Covington (as of November 2024-October 2025)
• Average Daily Rate (ADR): $254
• Occupancy Rate: 36.8%
• Median Annual Revenue: $31,441
• Growth Rate: 82.6% year-over-year

The market shows strong revenue potential with favorable conditions for new entrants, particularly in the summer months when occupancy and rates peak.

Required Documents, Permits, Licenses, and Guidelines

Mandatory Documentation

1. Short-Term Rental Application (Alleghany County Zoning Office)

   • Required for any STR operation
   • Must be submitted and approved before operation
   • Available through County Planning Department

2. Business Registration (Commissioner of the Revenue)

   • Required registration with local tax authority
   • Ensures compliance with local tax obligations

3. Property Compliance Documents

   • Building permits (if modifications required)
   • Septic system documentation (for non-sewer properties)
   • Property insurance (recommended but not specified in regulations)

4. Zoning Compliance

   • Verification of permitted use in zoning district
   • Special use permit (if required for R-2 zoning)

Operational Guidelines

• Structure Compliance: STRs must comply with all codes applicable to residential structures
• Use Classification: Treated as commercial use subject to zone district regulations
• Definition: Short-term rentals defined as stays of less than 30 days

Specific Regulations: City, County, and State Level

Alleghany County Zoning Regulations (County Level)

Zoning District Permitted Uses:

• AR (Agricultural Residential): STRs allowed by right
• R-2 (Residential): STRs permitted with special use permit
• R-1 (Residential): STRs not permitted

Regulatory Framework:

• Short-term rentals classified as commercial use
• Subject to all applicable zone district regulations
• Must comply with residential building codes
• Separate application required for each STR property

Definitions Established:

• Short-term rental: Properties rented for less than 30 days
• Bed and breakfast homestays and inns
• Cabin/cottage and cabin resort uses
• Seasonal and temporary use structures

Virginia State Regulations

Virginia Residential Landlord and Tenant Act (VRLTA)

• Applies to rental agreements for dwelling units
• Establishes rights and obligations of landlords and tenants
• Supersedes all local, county, and municipal landlord-tenant ordinances
• Covers most residential rental agreements with specific exemptions

Key State Requirements:

• Application fees limited to $50 (exclusive of third-party costs)
• Specific notice requirements for lease terminations
• Security deposit regulations
• Mold remediation standards

Exemptions from VRLTA:

• Single-family rental houses where landlord owns two or fewer
• Occupancy in hotels/motels for fewer than 90 consecutive days
• Business/commercial purpose rentals

Municipal (Covington City) Regulations

Current Status: No specific city-level STR ordinances identified in provided content. County regulations appear to apply to the entire jurisdiction.

Contact Information for Local STR Authorities

Primary Contacts

Alleghany County Planning & Zoning Department

• Staff Contact: Elizabeth Stull, County Planner/Zoning Administrator
• Phone: Contact through County Administration
• Email: Contact through County offices
• Address: Alleghany County Governmental Complex, Covington, Virginia

Commissioner of the Revenue

• Registration Required for: All STR operations
• Contact: Through County offices for specific contact information

County Administration

• Interim County Administrator: Peter M. Huber
• Address: Alleghany County Governmental Complex, Covington, Virginia

Support Resources

Legal Aid Services

• Blue Ridge Legal Services
• Phone: 800-237-0141
• Serves: Alleghany County
• Website: www.brls.org

Important Notes for STR Investors

Market Characteristics

• Seasonal Demand: Peak revenue in July, lowest in January
• Guest Profile: 95% domestic travelers, primarily from Richmond area
• Property Types: 87.1% are entire home/apartment listings
• Minimum Stays: 51.6% of listings offer 1-night minimum

Investment Considerations

• Low Regulation Environment: Favorable for STR operations
• Zoning Compliance Critical: Verify allowed use before purchase
• Growth Market: 82.6% revenue growth indicates strong potential
• Registration Essential: Both zoning approval and revenue registration required

Compliance Priorities

1. Verify zoning district permits STR use
2. Submit complete application to zoning office
3. Register with Commissioner of Revenue
4. Maintain residential code compliance
5. Monitor for any future regulatory changes

Sources and Links

Primary Source Documents:

• Alleghany County Board of Supervisors Meeting Minutes (September 7, 2021): www.co.alleghany.va.us/attachment/2268
• Virginia Residential Landlord and Tenant Act: www.vdh.virginia.gov/content/uploads/sites/12/2016/02/Landlord-Tenant-Handbook.pdf
• Covington STR Market Analysis: www.airroi.com/report/world/united-states/virginia/covington

Note: This analysis is based on available documentation from September 2021. Investors should verify current regulations and contact local authorities directly for the most up-to-date requirements, as zoning regulations and municipal codes may have been updated since the provided documentation.

This guide provides comprehensive information based on available regulatory documents and market analysis. Professional consultation with local planning authorities and legal counsel is recommended before initiating any STR operation.