Written by: Sanjin Hadziomerovic
Houston’s first short-term rental (STR) ordinance was unanimously approved on April, 16th 2025, for the first time establishing a registration-and-compliance framework to balance neighborhood protection with responsible hosting.
Applications will become available on August 1, 2025, and all Airbnb operators must secure a valid Certificate of Registration by January 1, 2026. This analysis aligns with the proposed ordinance.
Market Appeal: Airbnb Investment in Houston
There are 9,108 active short-term rentals in Houston as of January 2025. The average daily rate for these rentals is $177. This translates to an annual revenue of $31,026 for short-term rentals. The average gross yield for short-term rentals in Houston is 11.73%.
There is one particular Zip Code that stands out in Houston though with a gross yield almost triple the average. Curious which one it is? It is just one click away and available for free for – all our markets. Check out our Market Dashboard for more information and AI-driven data insights.
Key Provisions
- Registration & Fees
Online portal opens August 1, 2025; applications require a $275 filing fee plus a $33.10 annual administrative surcharge. All Airbnb operators must secure a valid Certificate of Registration by January 1, 2026. - Application Requirements
Property address; proof of ownership or owner consent; 24-hour emergency contact information; list of all booking platforms used in the prior 12 months; proof of Hotel Occupancy Tax registration/remittance. - Operational Rules
Minimum one-night stay; advertising as event venues is prohibited; on-site display of registration certificate and emergency contact details; platforms must delist unregistered properties within ten business days of notice. - Enforcement & Penalties
Fines of $100–$500 per violation per day; certificate revocation for false applications, unpaid taxes, repeated noise/nuisance citations, or serious criminal activity by guests; appeal process available via administrative hearing .
Airbnb Rental Markets Set to Outperform in 2025
Download our comprehensive guide to learn:
- 📊 Which STR markets are set to outperform in 2025 based on revenue growth, occupancy trends, and supply shifts.
- 🏡 Where home prices are still affordable while generating high rental income.
- ⚖ Which cities have the best (and worst) STR regulations—so you don't get caught off guard.
- 🔎 The demand trends driving guest bookings and what amenities maximize revenue in each market.
Positive Impacts
- No Cap on Portfolio Size
Investors can grow without worry—there is no limit on the number of STRs a single owner may register, enabling unlimited portfolio expansion (each unit simply needs its own certificate). - Predictable Cost Structure
A fixed application fee ($275) and annual surcharge ($33.10) make budgeting straightforward, avoiding surprise charges or ad-hoc assessments. - Streamlined Compliance via Host Compliance
Online registration through Host Compliance by Granicus ensures a digital, self-service process—hosts can gather required documents and complete applications quickly, minimizing downtime between purchase and rental activation . - Enhanced Guest Confidence
Mandatory on-site display of a city-issued certificate and emergency contact details builds trust with guests, potentially improving reviews and occupancy rates. - Appeal Rights Mitigate Risk
The ordinance’s structured appeal process lets hosts contest denials or revocations, reducing the risk of abrupt enforcement actions without recourse . - Insurance Flexibility
No mandatory STR-specific insurance requirement gives investors freedom to choose coverage that aligns with their risk tolerance and property profile.
Potential Limitations for Investors
- Higher Costs & Admin Burden
$308.10 in initial fees per property plus annual renewals and mandatory change-reporting within 15 days may deter small-scale investors. - Scalability Constraints
Each unit—even in multi-unit complexes—requires its own certificate; large operators risk portfolio-wide revocation if 25% of units are cited within a year . - Enforcement Uncertainty
Resource limitations could hamper consistent ordinance enforcement, creating operational ambiguity for hosts . - Liability for Guest Conduct
Hosts face revocation risk if guests commit disqualifying offenses, effectively shifting guest liability onto property owners
Additional FAQ Highlights
- Permit Required? No—but operators must comply with deed restrictions, HOA rules, and community standards .
- Renewal & Updates: Certificates last one year; hosts must renew annually and report any application changes within 15 days.
- Responsible Agent: A 24/7 emergency contact must be listed and able to respond within one hour.
- Insurance? There is no mandatory STR-specific insurance requirement.
For full FAQs and deeper guidance, visit our article Houston, TX Rental Regulation FAQ 2025.
Final Thoughts
Houston’s new STR ordinance provides a clear, predictable framework that empowers investors with unlimited growth potential, transparent costs, streamlined digital registration, and strong due-process safeguards—helping Airbnb operators maximize returns while fostering community trust.
Continuous monitoring of enforcement practices and market response will be key to sustaining Houston’s position as a leading STR investment market.
