Hot Springs, AR Airbnb & Short-Term Rental Regulations 2026
Everything you need to know about operating a legal short-term rental in Hot Springs, Arkansas. Licensing, taxes, zoning, and 2026 compliance requirements.
Hot Springs STR Regulation Overview
Hot Springs, Arkansas — the Spa City wrapped around a national park — runs a clear but increasingly tight STR program. Every operator needs a city business license, a Certificate of Occupancy, and a designated 24/7 local contact, and licenses renew annually on January 1. The defining feature for 2026 is the 400-license cap on residential zones, which the city has reached: no new residential STR licenses are being issued, so newcomers are effectively pushed into the city's commercial and mixed-use districts, which remain uncapped. There is no primary-residence mandate, so non-owner-occupied investment properties are allowed where licenses are available. The fee structure is modest — $50 per person of authorized occupancy with a $200 floor — making cash-flow math easier than in many resort towns. Combined with steady spa-and-park tourism demand, Hot Springs stays attractive, but buyers must verify a property's zone and license availability before purchasing.
Hot Springs STR Quick Facts
| STR Legal? | Yes |
| License Required | Yes |
| License Cost | $50 per person of max occupancy per year ($200 minimum) |
| Lodging Tax | 12.5% combined |
| Occupancy / Density Caps | Hard citywide cap of 400 STR licenses in residential zones (RR, RS, RN-1 through RN-6) — currently maxed out, so no new residential licenses are being issued; non-residential zones are uncapped. |
| Primary Residence Required | No |
Business license required for every STR
All short-term rentals — defined as any house, cabin, condo, or apartment rented for under 30 days — must hold a City of Hot Springs STR business license. Licenses are issued for the calendar year, renew January 1, and are generally non-transferable except for certain family transfers.
License fee is occupancy-based
The annual fee is $50 per person of maximum authorized overnight occupancy, with a $200 minimum. A four-guest cabin pays the $200 floor; a ten-guest property pays $500/year. Fees are due each January 1.
400-license cap on residential zones is full
Residential zones (RR, RS, RN-1 through RN-6) are subject to a citywide cap of 400 STR licenses. The city reached that cap, and no new residential-zone licenses are available; those already above the cap may continue renewing. Non-residential zones (C-TR, CN, CMU, CG, CBD, IL, IH, IMU), HPR, and condos recorded before January 18, 2022 remain open.
Certificate of Occupancy and Special Use Permit
Applicants must pass a Certificate of Occupancy inspection verifying building and fire-code compliance, and submit a floor plan with off-street parking. Increasing occupancy beyond the licensed capacity in a residential zone requires a Special Use Permit.
Combined lodging tax near 12.5%
Bookings are subject to 9.5% sales tax (6.5% state, 1.5% city, 1.5% Garland County) plus the city's 3% Advertising & Promotion lodging tax, totaling roughly 12.5%. Airbnb and Vrbo collect some Arkansas state taxes automatically, but hosts should confirm local A&P remittance.
Steep penalties for non-compliance
Operating without a license or violating STR rules draws fines of $1,000 for a first offense, $2,000 for a second, and $4,000 for each subsequent offense, plus an additional $500 per day for continuing violations. The City Manager may also order disconnection of municipal water service.
Hot Springs STR Market Performance
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Frequently Asked Questions
Yes. STRs are legal under the city's short-term rental ordinance, but every operator must hold a city business license and pass a Certificate of Occupancy inspection. The key catch for 2026 is that the city's 400-license cap on residential zones is full, so new licenses are only available in non-residential and mixed-use districts.
The annual STR business license fee is $50 per person of maximum authorized overnight occupancy, with a $200 minimum. For example, a property approved for four guests pays the $200 floor, while one approved for ten guests pays $500. Fees are due each January 1, and licenses must be renewed annually.
Hot Springs limits STR licenses in its residential zones (RR, RS, RN-1 through RN-6) to 400 citywide. That cap has been reached, and the city is not issuing new residential-zone STR licenses. Investors seeking new licenses must buy in non-residential, commercial, or mixed-use zones, which remain uncapped.
Hot Springs STR guests pay roughly 12.5% in combined taxes: 6.5% Arkansas state sales tax, 1.5% city and 1.5% Garland County sales tax (9.5% combined sales tax), plus the city's 3% Advertising & Promotion (A&P) lodging tax. Airbnb and Vrbo collect certain Arkansas state taxes automatically, but hosts are responsible for confirming local A&P remittance.
No. Hot Springs does not impose a primary-residence requirement, so non-owner-occupied investment STRs are permitted wherever a license is available. However, applicants must designate a local contact person reachable 24/7 to respond to issues, and residential-zone licenses are currently frozen due to the 400-license cap.
Informational only — verify current rules with local authorities before investing. Sources: www.hotspringsar.gov · www.hotspringsar.gov · www.hotsprings.org · www.garlandcounty.org · www.airroi.com
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