Everything You Need to Know About Owning a Short Term Rental in Memphis, Tennessee

Short-Term Rental Regulations in Memphis, Tennessee for 2026

Permit Requirements

• Short-term rental property owners must obtain a permit from the City Division of Public Works.
• Initial application fee: $300.
• Annual renewal fee: $150.
• Permits are non-transferable.

Zoning and Compliance

• Properties must comply with local zoning laws and regulations.
• Hosts must verify that their property is zoned appropriately for short-term rentals.

Insurance and Liability

• Owners must secure liability insurance with coverage of at least $1 million per occurrence.
• Proof of fire, hazard, and liability insurance must be provided.

Safety and Health Codes

• Properties must have fire sprinklers, smoke alarms, and carbon monoxide detectors.
• A five-pound fire extinguisher must be present in each unit.
• Approved smoke alarms and carbon monoxide detectors are required in all sleeping areas.

Operational Requirements

• Principal renters must be at least 18 years old.
• Short-term rentals are defined as properties rented for no more than 30 continuous days.
• Owners must designate a responsible party who lives within 50 miles of the property and can respond to issues promptly.

Tax Obligations

• Operators must collect and remit local and state sales and tourist taxes from guests.
• The city’s occupancy privilege tax rate is 5%, and the total sales tax rate is 9.75%.

Community and Neighborhood Relations

• Regulations aim to address concerns such as noise complaints, parking issues, and overall safety to maintain neighborhood dynamics.

Additional Requirements

• Owners must include their permit number on any advertisement or listing for the property.
• A site plan showing each unit and other structures and site features must be submitted.
• An inspection by Memphis/Shelby County Code Enforcement may be required.

Occupancy Limits

• Short-term rental properties may have occupancy limits defined by local zoning laws to maintain safety and community welfare.

Regulatory information last reviewed for accuracy in 2026. Local STR ordinances change frequently — verify current rules with the city or county before listing.

Top Neighborhoods for Airbnb Revenue in Memphis, Tennessee

1. Midtown

• Midtown is highly appealing due to its central location and proximity to several key attractions. Guests can walk to Overton Park, the Memphis Zoo, and Overton Square, which features live music, restaurants, and a movie theater.
• The neighborhood is home to various highly-rated Airbnb properties, including cozy duplexes, HGTV-inspired retreats, and homes with unique Memphis-themed decor.

2. Downtown Memphis

• Downtown Memphis is a hotspot for guests due to its vibrant nightlife and easy access to historic Beale Street, the Orpheum Theater, and the National Civil Rights Museum.
• The area offers modern condos with amenities like free gated parking, smart home technology, and high-end appliances, making it ideal for both vacationers and business travelers.

3. Cooper-Young

• Cooper-Young is a historically hip neighborhood that attracts guests with its quaint atmosphere, excellent restaurants, and bars. It is close to Memphis Made Brewery and City Market Grocery Store.
• This neighborhood features unique properties, such as the "Memphis House," which is a mini-museum filled with Memphis-themed books, art, and music.

4. Raleigh

• Raleigh is another lucrative neighborhood for Airbnb, known for its high occupancy rates and daily returns. It offers a mix of residential and commercial areas, making it attractive for various types of travelers.
• While specific amenities are not as detailed as in other neighborhoods, its overall appeal lies in its balance of local charm and accessibility to Memphis's main attractions.

5. River Oaks-Kirby

• Although less detailed in terms of specific attractions, River Oaks-Kirby is identified as one of the top neighborhoods for Airbnb investment due to its high cash on cash return and occupancy rates.
• This area likely appeals to guests seeking a more suburban experience while still being within reach of Memphis's central attractions.

These neighborhoods are favored by guests for their unique blend of local culture, convenience, and access to Memphis's most popular attractions.

Tips for Furnishing and Designing an Inviting Airbnb in Memphis, Tennessee

Safety and Compliance

• Ensure your property complies with Tennessee state requirements for fire sprinklers, smoke alarms, and carbon monoxide alarms. Install smoke alarms in each room used for sleeping purposes and maintain, repair, and test them as necessary.

Local Regulations

• Obtain a Short Term Rental Property Permit from the City of Memphis Permit Office. Each property or unit requires an individual permit, and permits must be renewed annually.

Theme and Style

• Choose a theme that reflects Memphis's unique style, such as incorporating elements of blues music, Southern charm, or the city's vibrant neighborhoods.
• Stick to a consistent theme to create a cohesive and inviting atmosphere.

Furniture Selection

• Opt for sturdy, easy-to-clean furniture. Consider sofas with washable covers and avoid real or faux leather.
• Choose a solid bed that is easy to clean, and consider storage beds for extra space.
• Select a mattress that is at least 8 inches thick, preferably a memory foam mattress for durability.

Space Optimization

• Use smart storage solutions like beds with drawers, wall hooks, and stackable containers to keep the space tidy.
• Select space-saving furniture with big functionality, such as sofa beds, folding tables, or ottomans with hidden storage compartments.

Lighting and Mirrors

• Use mirrors to make the space feel bigger and brighter. Ensure there is a full-length mirror in each bedroom with a power socket nearby for hair dryers and straighteners.

Kitchen Essentials

• Equip the kitchen with essentials like a coffee maker, microwave, toaster, and kettle. Include a good blender, sharp knives, basic cookware, utensils, and dinnerware.
• Provide ample space for food storage, including a pantry or cupboards.

Comfort and Amenities

• Create a relaxing living room with comfortable seating and a functional kitchen.
• Include amenities like high-speed internet, a Wi-Fi booster if necessary, and a desk with good lighting for guests who need to work.

Local Touches

• Incorporate unique-to-Memphis decor such as books, art, and music that reflect the city's culture.
• Add local flavor with items like Memphis-themed artwork, blues music playlists, or recommendations for local attractions.

Guest Convenience

• Provide basic toiletries, a hairdryer, and a first-aid kit.
• Ensure there is adequate on-site parking and comply with noise restrictions and waste management provisions.

Accessibility

• Consider making your Airbnb accessible to guests with disabilities by including ramps, wide doorways, and grab bars in bathrooms.

Outdoor Spaces

• If applicable, enhance outdoor areas with features like a patio, grill, outdoor seating, and a fire pit to enjoy the Memphis nights.

By following these tips, you can create an inviting and uniquely Memphian Airbnb that will make your guests feel welcome and comfortable.

Discovering Memphis: Top Attractions and Insider Tips for Your Guests

Must-Visit Attractions

Music and Heritage

• Beale Street: Known as "America’s Most Iconic Street," this is a hub for blues clubs, live music, and regional food specialties.
• Sun Studio: The birthplace of rock ‘n’ roll, where Elvis Presley, Johnny Cash, and other legends recorded their first hits.
• Memphis Rock ‘n’ Soul Museum: A Smithsonian Institution exhibition showcasing the origins of rock and soul music.
• Stax Museum of American Soul Music: Located at the original site of Stax Records, highlighting the careers of Otis Redding, Isaac Hayes, and more.

Historical Sites

• National Civil Rights Museum: A poignant museum encompassing the former Lorraine Motel, where Martin Luther King Jr. was assassinated. It provides a deep dive into the civil rights movement.
• Graceland: Elvis Presley’s former home and headquarters, now a 200,000-sq-ft entertainment complex and a National Historic Landmark.

Family-Friendly Fun

• Memphis Zoo: Home to over 4,500 animals, featuring unique exhibits like Cat Country, Primate Canyon, and a farmhouse with a train ride.
• Mud Island River Park: Offers a river park, museum, and various activities like kayaking and a sea lion show.

Unique Experiences

• The Peabody Ducks: Watch the famous ducks march through the lobby of The Peabody Hotel to their fountain home.
• Bass Pro Shop at the Pyramid: Explore a giant, glass-covered pyramid turned into a Bass Pro Shop, complete with a southern swamp land and fish-filled marsh.

Insider Tips

Local Eats

• The Four Way Soul Food Restaurant: A legendary spot for home cooking and soul food, a must-visit for authentic Memphis cuisine.
• Central BBQ: Try the famous slow-cooked BBQ that Memphis is known for.

Hidden Gems

• Big River Crossing: A pedestrian and cycling bridge offering stunning views of the Mississippi River.
• Shelby Farms Park: One of the largest urban parks in the country, featuring over 40 miles of trails and 20 bodies of water for fishing.

Nightlife and Entertainment

• FedExForum: Catch an NBA game with the Memphis Grizzlies or enjoy local concerts and shows.
• Blues City Tours: Explore the city’s rich musical heritage with guided tours.

Outdoor Activities

• Memphis Riverboats: Take a sightseeing cruise along the Mississippi River for a unique perspective on the city.
• Tom Lee Park: Bike or walk along the River Line and enjoy the playground, public art, and views of the Mississippi River.

Additional Recommendations

• Old Dominick Distillery: Visit for a taste of local spirits and a tour of the distillery.
• Metal Museum: A unique museum showcasing metal art and offering stunning views of the Mississippi River.
• Clayborn Temple: A historic site significant to the civil rights movement, now hosting various community events.

By sharing these attractions and insider tips, you can help your guests experience the full richness and charm of Memphis, Tennessee.

Practical Tips to Run a Successful Short Term Rental Business in Memphis, Tennessee

To ensure the success and smooth operation of a short term rental business in Memphis, Tennessee, several practical tips can be implemented:

Noise Regulations and Quiet Hours

Inform your guests about quiet hours and noise regulations to maintain a respectful environment for neighbors. Clearly outline these rules in your house manual and communicate them through pre-arrival messages to avoid any potential issues.

Comprehensive House Manual

Create both digital and physical house manuals that include detailed instructions on how to use appliances, Wi-Fi passwords, and other essential information about the property. This helps guests navigate the space easily and reduces the number of inquiries you receive.

Simplified Check-in Process

Utilize smart locks to streamline the check-in process, eliminating the need for physical key exchanges. Provide guests with a unique access code and detailed instructions on how to enter the property, ensuring a seamless arrival experience.

Parking Instructions with Photos

Include clear parking instructions in your house manual, accompanied by photos to help guests identify designated parking areas. This prevents confusion and potential parking violations, enhancing the overall guest experience.

By implementing these strategies, you can enhance guest satisfaction, reduce operational headaches, and ensure your short term rental business in Memphis operates efficiently and compliantly with local regulations.

Short-Term Rental Management Fees in Memphis, Tennessee (2026)

Short-term rental management fees in Memphis, Tennessee in 2026 typically range from 15% to 30% of gross rental revenue, depending on the scope of services provided. Full-service management — covering guest communication, channel distribution across Airbnb, Vrbo, and Booking.com, dynamic pricing, cleaning coordination, and 24/7 guest support — generally falls in the 22% to 30% range. Co-hosting or partial-service arrangements that leave more responsibility with the owner usually run 15% to 20%.

Industry-wide management fees have crept upward by roughly 1–2 percentage points since 2024 as operating costs, insurance premiums, and labor expenses have risen across the vacation rental sector. Memphis-area managers may also charge separately for cleaning turnovers, maintenance dispatch, linen programs, and listing optimization. Some full-service operators in Tennessee now offer guaranteed-rent or revenue-share hybrid models, which can be worth comparing against a flat percentage structure for higher-revenue properties.

Market estimates as of 2026. Conditions vary; consult local operators for current data.

Short-Term Rental Market in Memphis, Tennessee (2026)

Memphis, Tennessee, continues to show resilient short-term rental performance heading into 2026. The average daily rate is approximately $133. These figures reflect 2024 baseline data adjusted for 2025–2026 ADR growth of 3–5% and the modest occupancy compression seen across the U.S. short-term rental sector as new supply has entered the market.

For investors and operators evaluating Memphis, the broader Tennessee dynamic remains favorable: rate strength continues to offset volume softness, keeping RevPAR (revenue per available rental) relatively stable year-over-year. Hyperlocal factors — neighborhood-level demand, seasonality, and the regulatory environment — should be confirmed before making investment or pricing decisions.

Market estimates as of 2026. Conditions vary; consult local operators for current data.