Charlottesville was among the first localities in the United States to regulate residential short-term rentals in 2015. More than a decade later, the city wants to update its rules, but it’s still juggling the often competing feedback from homestay operators and neighbors.
Short-term rentals, also referred to as homestays, gained popularity during the mid-2010s surge of services like Airbnb and VRBO. Charlottesville’s Neighborhood Development Services office defines a homestay as “a residential property that is rented for less than 30 days.”
As of September 2025, the number of short-term rentals in the city had increased roughly 20 percent from 2020 to approximately 10,000 annual listings, according to NDS. The accommodations are split across approximately 529 properties.
Since homestays’ popularity exploded, experts have raised questions about short-term rentals’ potential to hurt local housing markets. Affordable-housing advocates claim the rentals increase housing costs, while homestay proponents point out the economic benefits of tourism.
Regardless of the questionable impact of short-term rentals on local housing affordability, Charlottesville is updating its homestay ordinance to promote compliance, safety, and neighborhood wellness.
The proposed amendments, presented at a December 3 meeting at City Space, make slight changes to existing regulations in the 2023 development code. But a question-and-answer session following a presentation from Charlottesville Zoning Administrator Read Brodhead turned into an impromptu discussion of homestays, affordability, and the rights of private property owners.
“On my street, there are three [short-term rentals] that are 100 percent out of compliance,” said one attendee. “They take all the parking, they are overstuffed, and they have been for a long time. And I’m just curious what it takes for us to actually get them shut down, not just invited back into compliance. They are making so much money for them, it is 100 percent about money. They are never going to live here.”
Current and prospective homestay operators raised concerns about the impact of regulations on the city’s economy. “Just look at some of the pros and cons of all of this and put together more of a SWOTed-out system,” posed an attendee, apparently referring to a decision-making framework that considers strengths, weaknesses, opportunities, and threats. He further called for the city to think about “the butterfly effect this is going to have over restaurants, the Downtown Mall in general, the jobs that Airbnbs have offered to cleaners.”
Charlottesville is not proposing a ban on short-term rentals, nor a major change to what is allowed. The ordinance only regulates residentially zoned short-term rental properties.
“Community response was mixed, as I think we would expect,” says Brodhead.
“People are coming at it with different perspectives,” said City Councilor Natalie Oschrin after the meeting. “There’s the people who are upset that their neighbors are allowing a rowdy party to happen, or a constant change, constant turnover, of new faces on the street. And then there’s the people … getting a little extra pocket money by being able to rent out an extra property that they own.”
The most substantial change the city has proposed is an increase in the cost and duration of homestay permits, from an annual permit costing $100 to a three-year permit that’s $500. Other highlights from the proposed amendments include added proof of residency requirements, a mandatory safety inspection, adjusted maximum occupancy limits, and human trafficking awareness training mandated by the state legislature.
By making permits longer-term and more expensive, and requiring proof of residency, the city hopes to strengthen compliance with and enforcement of homestay rules. The fee would also help to cover the costs of safety inspections by the fire marshal, who would then set occupancy limits. The higher prices might not deter bad actors, but the affidavits will make it easier for the city to pursue legal remedies for rulebreakers.
“There are many people who come and get a permit and have absolutely no intention of following the rules,” says Brodhead. “This would be another check for people to really say, ‘Okay, I’m serious. I want to do this correctly, and I’m going to sign this, and if I don’t run my short-term rental correctly or homestay correctly, there will be penalties.’”
Charlottesville homestays can only be operated by property owners at their permanent residence; not at a secondary residence, and certainly not by an out-of-town company. This doesn’t stop people from trying to skirt the rules—and the 9 percent lodging tax.
Current, and proposed, city rules require the permit holder to reside at the property for 185 days a year, as proved by a photo ID or voter registration card. Under the proposed amendment, applicants would also need to sign an affidavit, “swear[ing] under oath that they meet the residency requirements.”
“We’re going to be able to cross-reference the tax revenue that we’re getting from VRBO and Airbnb to make sure that they are giving us accurate numbers, so that we’re making sure we’re getting the money that we’re properly owed,” said Oschrin.
To hold homestay operators to account, and identify non-permitted properties, the city has purchased a software program called Granicus. It’s already identified hundreds of potentially noncompliant short-term rentals. With the software, and a full-time employee dedicated to enforcement, the city plans to crack down on noncompliance with warning letters, fines, and (if necessary) legal action.
Current regulations limit homestay occupancy to six adults per property per day, but put no limit on the number of children. Still, not everyone is following that rule, according to Brodhead.
“I talked to one person who said that she commonly rents to 12 to 16 people. I don’t know how the math works,” he says. “Children are still people. So for safety’s sake, and how the building code looks at things, we’re going to limit two per bedroom, with a max of eight total.”
For now, the city is still pulling together feedback on the proposed changes. The ordinance is expected to go before the Planning Commission in late January or early February.
“We really want people to be able to continue to utilize their house as a short-term rental,” says Brodhead. “For many … that’s how they afford to stay in this town.”
