Texas Short-Term Rental Laws (2026): State Rules, City Limits and Taxes

Short-term rentals are legal in Texas, and the state leaves the question of where and how to each city, with Texas courts as the referee: there is no statewide license, no registry and no rental-specific preemption statute. What Texas does have is a 6 percent state hotel occupancy tax that applies to every stay under 30 days, a general preemption law (HB 2127) that hosts have begun invoking, and a string of appellate decisions that have stopped Austin and Dallas from enforcing bans on non-owner-occupied rentals.

This guide is for owners and managers running rentals in Texas cities, from Houston's new registration regime to the lake towns. It lays out the state framework, the four largest city programs, the hotel tax mechanics and the 2025–2026 changes, as part of our state roundup. Reviewed October 13, 2026. General information, not legal advice; confirm specifics with the named city or the Comptroller.

Key facts

• Texas has no statewide short-term rental license, registry or preemption law; the Legislature has considered bills that would curb city authority and has not passed one, so each city's ordinance governs unless a court strikes it.
• In Zaatari v. City of Austin (Tex. App.—Austin, November 27, 2019, review denied), the Third Court of Appeals held Austin's phase-out of non-homestead rentals unconstitutionally retroactive and struck its assembly restrictions; Dallas's 2023 zoning ban has been enjoined since 2023, with the Fifth Court of Appeals upholding the injunction.
• The state hotel occupancy tax is 6 percent of the total charge for stays of 29 nights or fewer, collected by Airbnb since 2017 and by Vrbo; local hotel taxes of up to 7 percent for cities, plus county levies, are collected by platforms only where a city has an agreement.
• Houston's Ordinance 2025-322 took effect January 1, 2026: $275 registration per property, a certificate number on every listing, $1 million in liability coverage and a 24-hour local contact.
• Austin's platform rules took effect July 1, 2026: platforms must delist unlicensed properties within 10 days of a city request, may not collect booking fees on them and face fines up to $500 a day.

Statewide rules

Texas regulates short-term rentals by omission. No chapter of the Local Government Code addresses them, no state agency licenses them and no statute tells a city what it may or may not require. The Texas Supreme Court has held that a residential-use covenant does not by itself prohibit short stays, which settles many HOA disputes in hosts' favor, but it leaves city ordinances untouched. The covenant case law across states is collected in what courts have actually held about short-term rentals.

Two limits on city power have emerged anyway. The first is constitutional. In Zaatari, the Third Court of Appeals invalidated Austin's 2016 ban on rentals by owners who do not claim the home as a homestead, finding it unconstitutionally retroactive, and struck limits on gatherings as an infringement on freedom of assembly. The Texas Supreme Court declined to hear the case. Dallas met the same wall: its 2023 ordinances barring rentals from single-family zoning were enjoined by a trial court, the Fifth Court of Appeals upheld the injunction and found owners would suffer irreparable harm, and the city asked the Texas Supreme Court in October 2025 to let it enforce the ban before the World Cup. As of our review, rentals in Dallas continue to operate under the injunction.

The second limit is statutory and untested. HB 2127, the 2023 Texas Regulatory Consistency Act, preempts local regulation in fields the state occupies, including property, and lets a person sue a city after giving three months' notice. It never mentions rentals. Yet on September 29, 2026, Corpus Christi received a notice of claim from a rental operator under HB 2127 and paused the rewrite of its ordinance; the earliest suit date is December 29, 2026. We explained the statute's reach and its limits in Texas HB 2127 and short-term rentals: the Dec. 29 clock.

There is no statewide safety, insurance or platform data-sharing requirement. Those come from the city, if at all, and the city programs below show how far they now go.

Major cities and counties

The through-line is enforcement by platform. Austin wrote the plainest version, Houston built registration around a certificate number the platforms can check, and both cities' approach assumes a listing without a number will stop earning before any inspector arrives.

Taxes

The state hotel occupancy tax is 6 percent of the price of a room for stays of fewer than 30 days, cleaning fees and other charges included; a guest who stays 30 consecutive days or more is a permanent resident and exempt. Airbnb has collected and remitted the state tax for Texas listings since 2017, and Vrbo collects it as well. Cities may levy their own hotel tax of up to 7 percent and counties add more; Houston and San Antonio run combined rates in the mid-teens, and local collection by platforms depends on whether the city has signed an agreement. Round Rock hosts, for example, self-file a 9 percent city hotel and venue tax that neither platform collects.

Direct bookings follow the same rules with no intermediary. You register with the Comptroller for the state tax, file quarterly or monthly, and open a local hotel tax account with each city and county whose rate applies. The Texas sales tax on Airbnb host fees is a separate matter: since October 1, 2025 the Comptroller's Rule 3.330 treated marketplace fees as taxable data processing, and on September 30, 2026 the agency ordered a proposed amendment to remove them; until the rule changes, a Texas host needs roughly a 19.5 percent markup to hold net on an Airbnb booking. Hosts who book direct avoid that line entirely, and tracking a state rate plus two or three local ones per property is what Haven's tax and accounting tooling is built for, with per-property state, county, city and district rates and cited rate suggestions.

What changed in 2025 and 2026

• February 2025: The Fifth Court of Appeals upheld the injunction against Dallas's 2023 rental ban; the city later asked the Texas Supreme Court to intervene (October 2025).
• April 16, 2025: Houston adopted Ordinance 2025-322, effective January 1, 2026.
• September 11, 2025: Austin's council approved its licensing overhaul; operator rules took effect October 1, 2025.
• October 1, 2025: Texas began taxing marketplace fees as data processing under amended Rule 3.330.
• January 1, 2026: Houston registration became mandatory.
• July 1, 2026: Austin's platform accountability rules took effect.
• September 2026: El Paso moved to collect hotel occupancy tax from short-term rentals; Corpus Christi received an HB 2127 notice of claim (September 29) and paused its rewrite; the Comptroller proposed removing platform fees from the data processing tax (September 30).
• Not changed: No statewide rental bill passed the 2025 session, and the Legislature does not meet in regular session again until 2027.

How to stay compliant

1. Find your city's program (registration, license or permit) and apply before the first booking; Houston, Austin, San Antonio, Galveston and Corpus Christi all require a number on the listing.
2. Register with the Comptroller for the 6 percent state hotel tax even when platforms remit it, so direct bookings have an account to flow through.
3. Open each local hotel tax account; assume the platform does not collect the city or county portion until the city's own page says it does.
4. Carry the liability coverage your city sets (Houston: $1 million per occurrence) and keep the certificate with the registration file.
5. Name a local contact who can answer within the city's response window and post the contact, occupancy and parking rules inside the unit.
6. Put the permit or certificate number on your direct booking site as well as on Airbnb and Vrbo; a city that asks platforms to delist will check your own site too.
7. Watch the Dallas and Corpus Christi litigation if you operate there; an injunction can lift as quickly as it was granted.
8. If guests stay 30 days or more, document the permanent-resident exemption rather than guessing at it.

FAQ

Is Airbnb legal in Texas?

Yes. No state law restricts short-term rentals, and the two cities that tried to ban non-owner-occupied rentals, Austin and Dallas, have been stopped by Texas courts. Most large cities instead require a registration or license and enforce it through the platforms.

Do I need a state license to host in Texas?

No. Texas has no statewide license or registry. You need your city's registration or permit where one exists, plus a Comptroller hotel occupancy tax account and any local hotel tax accounts.

What taxes do I pay on a Texas short-term rental?

The 6 percent state hotel occupancy tax on stays under 30 days, plus city and county hotel taxes that vary by location. Airbnb and Vrbo remit the state tax; local taxes are remitted by the platform only where the city has an agreement, and never for your direct bookings.

Can my Texas city ban short-term rentals?

It can try, and it will be challenged. Zaatari struck Austin's phase-out as unconstitutionally retroactive, and Dallas's zoning ban has been enjoined since 2023. Cities have shifted to registration and platform delisting instead.

What changed in 2025 and 2026?

Houston's registration ordinance took effect January 1, 2026; Austin's platform rules took effect July 1, 2026; Corpus Christi's rewrite stalled under an HB 2127 notice in September 2026; and the Comptroller began, then moved to end, sales tax on platform fees.

Sources

• Houston Permitting Center — Newly adopted short-term rental ordinance effective January 1, 2026 (accessed October 2026)
• City of El Paso — Short-term rentals in El Paso to contribute to hotel occupancy taxes (news release, September 6, 2026) (accessed October 2026)
• FindLaw — Zaatari v. City of Austin (Tex. App. 2019) (accessed October 2026)
• Texas Public Policy Foundation — Third Court of Appeals affirms win in short-term rental lawsuit (accessed October 2026)
• D Magazine — After appellate court ruling, Dallas still can't enforce its short-term rental ordinances (accessed October 2026)
• Planetizen — Dallas pleads with Supreme Court to allow short-term rental ban during World Cup (accessed October 2026)
• Airbnb — Occupancy tax collection and remittance by Airbnb (Texas listings) (accessed October 2026)
• Community Impact — McKinney looks to Airbnb for help collecting local hotel occupancy taxes (accessed October 2026)
• BNBCalc — Austin, Texas short-term rental regulations: 2026 guide (accessed October 2026)