Short‑Term Rentals In Minneapolis: Rules For Owners

Thinking about listing your Minneapolis home as a short-term rental, but not sure where to start? You are not alone. Between permits, taxes, and neighborhood rules, it can feel like a maze. This guide breaks down how short-term rentals work in Minneapolis, what you must do before you host, and how homesteaded and non-homesteaded properties are treated differently. By the end, you will know the key steps to operate legally and avoid costly mistakes. Let’s dive in.

What counts as a short-term rental

Short-term rentals are furnished stays offered for a limited number of nights at a time. In Minneapolis, the city regulates STRs to reduce neighborhood impacts, support safety, and ensure proper tax collection. Rules distinguish between hosted stays where the owner is present and unhosted or entire-home rentals where the owner is not on site.

You will also see differences between properties that are your primary residence and those that are not. These categories affect whether you can host, how you must register, and what limits may apply.

Homestead vs non-homestead: why it matters

Your property’s status is a central factor in what is allowed.

• Homesteaded primary residence: You live at the property as your main home. You can typically host while you remain on site and sometimes rent the entire place while you are away, subject to city rules. You will likely need to prove primary residency during registration.
• Non-homestead property: This includes investment properties, second homes, and units you do not occupy as your principal residence. These rentals often face stricter rules, different registration pathways, possible caps, and sometimes higher fees.

Homestead status is verified through local property records. Keep your records current if you intend to claim homestead hosting benefits. Remember, rental income is still taxable regardless of homestead status.

Registration and permits: start here

You must register or obtain a permit from the City of Minneapolis before you list or host. The city issues a registration or license number that you need to display in your online listings and inside the unit.

Operating without a valid registration can lead to warnings, fines, or suspension. Do not list your place publicly until you have approval.

What you need to apply

While exact documentation can change, expect to provide:

• Proof of ownership or legal right to operate the unit.
• Primary residency documentation if applying as a homestead host.
• Contact information for a 24/7 local contact or manager.
• Proof of required liability insurance.

The city may require an initial inspection or a safety attestation. Always follow the current application instructions on the city’s STR program page or ordinance.

Safety and inspections

Minneapolis focuses on life-safety measures. Be prepared to confirm:

• Working smoke alarms and carbon monoxide detectors.
• Safe egress from sleeping rooms and overall compliant exits.
• At least one fire extinguisher and clear emergency instructions for guests.

Some properties require an inspection; others allow self-certification. Keep dated records of your safety checks and maintenance.

Posting and guest rules

Plan to post required information both online and inside your rental. This commonly includes:

• Your city registration or permit number on all listings.
• A 24/7 contact number for emergencies.
• House rules that cover trash, parking, maximum occupancy, and quiet hours.

Guests should receive these rules before check-in. Consistent messaging reduces complaints and protects you during enforcement.

Taxes you must collect and remit

Short-term rental stays in Minneapolis are subject to Minnesota state sales tax and lodging or transient taxes that may include city or county components. Some platforms collect and remit certain taxes for you, but they may not cover every tax that applies to your listing.

You are responsible for any taxes that a platform does not collect. Register with the state for tax purposes, confirm which taxes apply to your property, and set up a system to remit them on time. Keep clear records of each payment.

Neighbor notification and contact

Many cities, including Minneapolis, require some form of neighbor notification and a responsive local contact who can address issues quickly. Check the city’s STR program materials to confirm who must be notified, when, and how. If a complaint comes in, you may be required to respond within a specific timeframe.

Make it easy for neighbors to reach you or your manager. Good communication can resolve most issues before they escalate to the city.

Ownership limits and caps

To manage neighborhood impacts and housing supply, Minneapolis has adopted measures that limit concentrations of non-homestead or entire-home rentals. These policies can include caps by area or limits on how many registrations a single owner can hold. Some programs prioritize homestead hosts or treat existing operators differently than new applicants.

Because caps and priority systems can change, confirm the latest rules directly in the Minneapolis Code of Ordinances and the city’s STR program page before you invest or expand.

Enforcement and penalties

Minneapolis uses a combination of complaint-driven enforcement, inspections, and administrative penalties. If you operate without a permit, exceed occupancy, misrepresent your listing, or fail to post required information, you could face warning letters, daily fines, suspension or revocation of your STR authorization, and additional action for repeat violations. Failure to remit taxes can trigger state or local assessments.

Keep documentation of compliance so you can respond quickly if the city contacts you. Most enforcement issues are preventable with good records and clear guest rules.

A step-by-step checklist for owners

Use this practical sequence to stay on track:

1. Verify your property status

• Determine if the unit is homesteaded and gather proof of primary residency if applicable.
• Review your deed or lease and any HOA rules to confirm STRs are allowed.

2. Review city rules and apply

• Read the current Minneapolis STR program materials and ordinance text.
• Complete the application and obtain your registration or permit number before listing.

3. Meet safety and insurance requirements

• Install and test smoke and carbon monoxide alarms; confirm egress from sleeping rooms.
• Keep a fire extinguisher accessible and visible.
• Maintain required liability insurance for short-term rentals.

4. Set up tax compliance

• Register for state sales and lodging taxes as needed.
• Confirm what your platform collects and remit any remaining taxes yourself.

5. Prepare listings and in-unit postings

• Include your city registration number on every listing.
• Post your 24/7 contact info, house rules, and an emergency plan inside the unit.

6. Notify neighbors if required

• Follow the city’s notification process and timelines.
• Provide neighbors with a contact and respond promptly to concerns.

7. Keep records and calendar reminders

• Save copies of your application, permit, insurance, inspections, tax filings, and guest rules.
• Track renewal dates and monitor ordinance updates.

Common mistakes to avoid

• Listing before you register. Always obtain your permit number first.
• Assuming platform protections cover everything. Platform guarantees do not replace required insurance or taxes.
• Skipping neighbor communication. Most complaints are resolved faster when you respond quickly and document your efforts.
• Ignoring HOA or lease restrictions. City approval does not override private rules.
• Missing updates. STR regulations evolve, and caps or ownership limits can shift.

Homesteaded hosts: practical tips

If you live in the property you plan to host:

• Keep your homestead status current and easy to prove.
• Clarify whether you will host while on site, rent the entire unit while away, or both.
• Maintain a quiet-hours policy and parking plan that works for your street. It reduces complaints and supports renewals.

Non-homestead owners: what to plan for

If you are operating an investment property or second home:

• Review any caps or limits on non-homestead whole-home rentals before buying or converting a unit.
• Expect stricter oversight, potential inspections, and possibly different fee structures.
• Budget for commercial-grade insurance if required by your carrier or the city.

If your plans change

Maybe hosting no longer fits your goals, or caps limit your options. You can consider a long-term rental strategy or explore a sale and reinvest. If resale is on the table, understanding current neighborhood demand and pricing helps you time the market and maximize value.

Thinking about the next step for your Minneapolis property? Reach out for a local pricing assessment and a conversation about your options.

Ready to navigate STR rules with confidence and protect your investment? The McNamara Group can help you evaluate scenarios, from hosting readiness to exit strategies, and provide a clear plan aligned with your goals.

FAQs

Do Minneapolis short-term rental hosts need homestead status?

• No. You can operate as a non-homestead host, but you will likely face stricter requirements and potential caps than a homestead host.

What taxes apply to short stays in Minneapolis?

• Expect Minnesota state sales tax and local lodging or transient taxes. Platforms may collect some taxes, but you are responsible for any remaining amounts.

Do I need a permit before listing on a platform?

• Yes. Obtain your Minneapolis registration or permit number first and include it on every public listing and inside the unit.

What if a neighbor complains about my STR?

• The city may investigate. Respond quickly, address the issue, and document your actions to avoid fines or suspension.

Are platform guarantees enough for insurance?

• No. Platform protections do not replace the liability insurance required by the city or your insurer. Maintain your own policy.

Can I hold multiple STR registrations in Minneapolis?

• Possibly, but the city may limit non-homestead registrations or whole-home rentals. Check the current ordinance and program guidance.

Does my STR permit transfer if I sell the property?

• Often permits do not transfer automatically. Buyers typically must apply under their own name. Confirm the current city policy before closing.