Frequently Asked Questions

A short-term rental operator or “host” is the owner or party otherwise responsible for a short-term rental unit. An operator must get a short-term rental permit to operate, rent, offer to rent, or advertise a short-term rental within the City. To qualify for a short-term rental permit, the operator will need to:  

1. Be available to respond to the property within one (1) hour, twenty-four (24) hours per day while the property is rented;
2. Have a valid business registration;
3. Pay all applicable local, state, and federal taxes, including lodgers' tax, gross receipts tax, and income tax associated with the operation of each short-term rental unit;
4. The short-term rental unit meets all building, fire, and safety codes for the applicable zoning of the property;
5. Maintain short term rental insurance coverage for each short-term rental unit in the minimum amount of $250,000 per short-term rental unit;
6. Notify all guests in writing of relevant city ordinances;
7. Provide adequate off-street parking.
   • one (1) parking space for a short-term rental unit with zero (0) to two (2) bedrooms available for rent;
   • two (2) parking spaces for a short-term rental unit with three (3) to four (4) bedrooms available for rent; and
   • three (3) parking spaces for a short-term rental unit with five (5) or more bedrooms available to rent.

8. Clearly display inside each short-term rental unit a copy of the applicable short-term rental permit issued.
9. Include the permit number issued by the City on all marketing materials for each short-term rental unit they operate, including listings on a host platform.

The Short-Term Rental Permit Application will be available beginning May 15, 2025. However, any permits issued prior to July 1, 2025, will not be effective until July 1, 2025.

You can complete the Short-term Rental Permit Application by clicking here. Applicants are encouraged to prepare to read the application instructions and prepare required information or documentation prior to starting the application process.

• $100 Application Fee. This non-refundable fee covers the cost to review and process your application for a short-term rental permit and the initial safety inspection. This payment is due at the time your application is submitted. Your application will not be considered complete until this fee is paid.  
• $50 Reinspection Fee. If a short-term rental unit fails to meet the requirements of the initial safety inspection, the Operator will be charged this fee each time another inspection is scheduled.
• $35 Business Registration Fee. Operators are required to maintain a valid business registration with the City of Rio Rancho. You can apply for your business registration once your application is reviewed and your inspection is complete.
• $300 Annual Permit Fee. Once your application is reviewed and approved, and your business registration is complete, this fee will need to be paid before your short-term rental permit is issued.  
• $50 Late-fee. This fee applies to annual renewals only and is required to hold your permit (for 15 days) if you have not successfully completed the renewal process by the expiration date.
• $1.75 Transaction fee. A transaction processing fee will be charged for each credit card payment made through the web portal. This fee can be avoided by paying invoices in person at City Hall (3200 Civil Center Circle, Rio Rancho, NM 871244)

Yes. To obtain a permit, all short-term rental units must successfully complete a safety inspection conducted by Development Services. Once your application for a permit is determined to be complete, you will be contacted to schedule an inspection of your unit(s). If a short-term rental unit fails to meet the requirements of the initial safety inspection, the Operator will be charged a $50 reinspection fee each time another inspection is conducted. Operators are advised to review the Short-term Rental Safety Inspection Checklist and prepare their unit(s) prior to scheduling their safety inspection

Despite the City’s short-term rental permit program, Homeowners Associations (HOA) may still prohibit short-term rentals from operating within their covered neighborhood. Applicants are encouraged to check with their HOA to ensure short-term rentals are permitted in their neighborhood prior to submitting a Short-term Rental Permit Application.

A Short-term Rental Unit can be rented a maximum of six separate times within a calendar month. There is no rental frequency limitations during the month of October each year.

The maximum overnight occupancy of a short-term rental unit is limited to two people per bedroom plus an additional two people per unit. For the purpose of calculating occupancy, children under the age of two are excluded. If you are renting one room in your house, the occupancy limit is two people, excluding children under two years of age.  For a four-bedroom, full-house rental, the maximum occupancy is ten people, excluding children under two years of age.

Gatherings in the short-term rental unit are limited to two times the maximum overnight occupancy.

A permit is required to operate, rent, offer to rent, or advertise any short-term rental unit in the City of Rio Rancho regardless of how often the unit is rented. Failure to obtain a permit may subject the operator to the citation to Municipal Court.

Operators are responsible for collecting and paying all applicable local, state, and federal taxes, including lodgers' tax, gross receipts tax, and income tax associated with the operation of each short-term rental unit. Operators will need to work with state and federal tax authorities to pay applicable gross receipts and income taxes.

Lodgers' Tax is remitted to the City through the Lodgers' Tax Payment Portal (available by the end of September 2025).  

Under the City’s Lodgers' Tax Ordinance (hyperlink), Operators are required to impose a 5% occupancy tax on the gross taxable rent on all short-term rental stays. These taxes must then be reported and remitted to the City by the 25th of the following month using the Lodgers' Tax Portal. For example, Lodgers' tax collected on rentals in July 2025 will be due on August 25, 2025.

Lodger’s Tax is not automatically collected by online hosting platforms for the City of Rio Rancho.  Operators are required to collect this tax and remit it to the City through the Lodgers’ Tax Payment Portal (available by the end of September 2025).

Additionally, all Operators may be subject to a random audit conducted by the City each year. For this reason, Operators are required to maintain records of all taxes and proceeds received for use of the Short-term unit.

A Short-term Rental Operator must renew a short-term rental permit and the associated business registration each year by the expiration date of the previous short-term rental permit. An application for renewal of a short-term rental permit needs to include the same information and documentation as the initial permit.

If a short-term rental permit is not renewed by the date the previous short-term rental permit expires, the owner may pay a late fee of fifty dollars $50.00 to extend the time for filing by fifteen 15 days.  

If a permit is not renewed by its expiration date, including the 15 day extension, then the permit will revert to Development Services and will become available to the next eligible applicant. 

Under the ordinance, applicants are required to provide proof of at least $250,000 of liability coverage for all short-term rental stays. Some platforms, such as Airbnb and VRBO, automatically provide sufficient coverage for short-term rental stays. In these cases, operators may submit their user terms and conditions, which detail this coverage for each platform on which they advertise, as documentation.

If, however, operators are booking through other platforms that don't include this coverage, they will need to demonstrate sufficient coverage for those stays. Homeowner's or landlord insurance policies do not necessarily cover short-term rental stays. Therefore, if relying on private insurance, the operator will have to provide documentation of a policy that specifically covers short-term rental stays at the required amount.