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Operating a short-term rental (STR) in Wilmington, Delaware, involves adhering to a complex set of regulations at the city, county, and state levels. This guide provides an in-depth look at the requirements and how Lodge Compliance can assist hosts in maintaining compliance.
Understanding Short-Term Rentals in Wilmington
A short-term rental in Wilmington is defined as the rental of all or part of a residential dwelling unit for periods of 30 consecutive days or less. This includes properties listed on platforms like Airbnb and Vrbo.
City of Wilmington Requirements
1. Rental License
All rental properties in Wilmington must be registered with the Department of Licenses and Inspections. This applies to both long-term and short-term rentals. The registration ensures that properties meet safety and zoning standards.
2. Short-Term Rental Permit
In addition to the general rental license, STR operators must obtain a specific short-term rental permit. Key requirements include:
- Owner Occupancy: The owner must reside in the property when it's not rented out.
- Limit on Properties: Owners are restricted to operating only one short-term rental property within the city.
- Safety Compliance: Properties must adhere to safety standards, including functioning smoke detectors, carbon monoxide detectors, and fire extinguishers.
- Insurance: A minimum of $1 million in liability insurance is required.
- Noise and Sanitation Plans: Operators must have plans in place to manage noise and maintain cleanliness.
- Annual Renewal: Permits must be renewed annually, with updated documentation and compliance verification.
To be eligible to operate a short-term rental in Wilmington, you must be at least 18 years old, have no outstanding city violations or unpaid taxes, and if you're registering as a business entity, you are limited to operating a maximum of six short-term rental properties in total.
State of Delaware Requirements
1. Business License
Operators not using a third-party platform (like Airbnb or Vrbo) must obtain a Delaware business license. This license is necessary for collecting and remitting state taxes.
2. Lodging Tax
Effective January 1, 2025, Delaware imposes a 4.5% lodging tax on short-term rentals. This tax applies to the rental amount and must be collected from guests.
3. Tax Collection and Remittance
- Collection Timing: The tax must be collected no later than the earlier of the final payment of all rent due or occupancy of the rental.
- Filing Deadline: Taxes collected must be filed and paid to the Delaware Division of Revenue by the 15th day of the month following the month of collection.
- Penalties: Late filings are subject to penalties, including a 5% per month penalty and 0.5% monthly interest.
Operational Guidelines for STR Hosts
1. Zoning Compliance
Ensure your property is located in a zone that permits short-term rentals. Residential zones R-1 through R-5 generally do not allow STRs; these zones are restricted to bed-and-breakfast establishments with owner occupancy. Short term rentals are strictly allowed in limited zones. Contact the Wilmington Department of Land Use and Planning for zoning confirmation.
2. Noise Regulations
Adhere to the city's noise ordinances. Quiet hours are typically enforced from 10:00 p.m. to 7:00 a.m. Noise disturbances during these hours may lead to penalties.
3. Trash and Sanitation
Guests must be informed of trash and recycling collection days and local rules. Waste must be stored in proper containers and placed at the curb no earlier than the night before collection.
4. Guest Conduct
Parties and commercial events are prohibited. Guests must respect neighborhood quiet hours and conduct themselves responsibly.
Compliance Responsibilities for Hosts
Advertisement Requirements
- Must display the STR permit number.
- Indicate ADA compliance.
- List guest bedroom count and max occupancy.
- Only one unit may be advertised per listing.
Onsite Posting Requirements
- Owner permit must be visible from the street.
- Evacuation diagram must be posted inside, showing fire exits, smoke detectors, fire extinguishers, and CO detectors.
Sanitation and Trash Requirements
- Daily visual inspections required.
- Regular trash collection must be maintained.
- Adequate, lidded trash bins must be provided.
- Guests must be notified of waste collection rules.
Noise Abatement Plan
- Must include a noise monitoring device.
- Guests must be informed of local noise rules and quiet hours.
Emergency Contact Requirements
- Designated operator must be reachable by phone 24/7.
- Complaints must be resolved within 3 hours.
Guest Use Restrictions
- STRs cannot be used as reception facilities or for events.
- Rentals must be for at least one night and to a single party.
Criminal Activity Reporting
- Known or suspected criminal activity by guests must be reported to the Wilmington Police Department.
Records and Documentation
- Keep records for at least 3 years.
- Must include dates, guest count, rates, rental income, and taxes.
- Records must be available upon request.
Inspections
- Owners must submit to inspections when requested.
- Emergency inspections are allowed in hazardous or unsafe situations.
Contact Information for Regulatory Bodies
- Wilmington Department of Licenses and Inspections: (302) 576-3030
- New Castle County Department of Land Use: (302) 395-5400
- Delaware Division of Revenue: (302) 577-8200
How Lodge Compliance Can Help
Navigating the complexities of short-term rental regulations can be overwhelming, but Lodge Compliance makes it simple. We help with licensing, renewals, zoning advice, tax setup and filing, so you can focus on hosting while we handle the red tape. For professional help with your Wilmington STR setup or compliance review, visit www.lodgecompliance.com.
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