Short-term rental rules in Anne Arundel County.

Annapolis just passed a moratorium. The county itself caps STR use at 120 days per calendar year and runs a separate use tax. Here's what a Maryland investor needs to know before underwriting a short-term rental in Anne Arundel.

1. Two layers of regulation

A short-term rental in the Annapolis area is subject to two separate regulatory layers:

• Anne Arundel County — applies countywide outside the city limits.
• City of Annapolis — has its own (stricter) rules inside the city limits, including the 2026 moratorium discussed below.

Confirm which jurisdiction your property is in before you make assumptions. The city limits and the county rules diverge meaningfully.

2. Anne Arundel County rules

Anne Arundel County defines a "Short-Term Residential Rental" as the use or occupancy of all or part of a dwelling unit to provide accommodations to transient guests for no more than 120 consecutive days in a calendar year [1][2]. Above that threshold, it isn't a STR — it's something else under the zoning code.

Key county requirements [1][2]:

• Licensing. STR operators must obtain a county short-term residential rental license. Applications are processed through the county's Land Use Navigator online portal [1].
• Code chapters. The relevant county code is Title 13A (and related zoning sections); operators should read the current text before applying [2].
• Use-or-occupancy tax. Anne Arundel County imposes a separate Use or Occupancy Tax on STR rentals — see section 4 below [3].

3. Annapolis City rules (and the 2026 moratorium)

If the property is inside the City of Annapolis limits, additional rules apply on top of (or in place of) county rules:

• Block cap. The Annapolis City Council voted to restrict short-term rental properties to no more than 10% of any given block [4].
• 2026 moratorium. In March 2026, the Annapolis City Council approved a one-year moratorium on new non-owner-occupied short-term rental licenses, passing 8–1 [4]. The moratorium does not apply to:
  • Owner-occupied STR units.
  • Existing licensees.
  • License renewals.

For a non-owner-occupied investment STR in Annapolis specifically, the moratorium effectively blocks new licenses during its window. New buyers of existing-licensed STRs need to verify whether the license is transferable.

4. Use or Occupancy Tax

Anne Arundel County imposes a Use or Occupancy Tax on short-term rentals. Per the county's tax page, the tax applies to the rental charge, and the county code definitions of "rent" include even "revenue from no-show, early departure and cancellation fees that are a condition of use or occupancy" [3].

STR operators are generally responsible for collecting the tax from guests and remitting to the county. Platforms (Airbnb, Vrbo) sometimes collect-and-remit certain taxes on the operator's behalf in some jurisdictions; this may or may not include all applicable Anne Arundel taxes. Verify with the platform and the county to confirm what's covered.

Maryland state sales-and-use tax may also apply to short-term lodging under state law — confirm with the Maryland Comptroller.

5. How to register

1. Verify zoning. Confirm the property's zoning allows short-term rentals — some districts in the county and city do not.
2. Apply through Land Use Navigator for the county STR license [1].
3. If in Annapolis: apply separately through the city's licensing process, and confirm current moratorium status [4].
4. Register for tax remittance with the county (Use or Occupancy Tax) and with the Maryland Comptroller as applicable [3].
5. Confirm insurance. Standard homeowner's policies typically exclude STR use. Get a commercial or short-term-rental-specific policy.
6. Comply with platform requirements. Airbnb, Vrbo, and others require license numbers on listings in many jurisdictions.

6. What it means for underwriting

• 120-day county cap matters for occupancy projections. If your model assumes 50% annual occupancy and your property is governed by the county's 120-day rule, your max nights are capped at 120 — not 182 — regardless of demand.
• Tax remittance reduces effective ADR. Build the use tax into your model as an expense reducing net revenue, not a pass-through.
• License premium on Annapolis-area resales. Existing-license properties may be priced 5–20% above otherwise-comparable non-STR-eligible homes — verify whether you're paying for license value, and whether it transfers.
• Long-term rental as backup. Underwrite the property to also work as a long-term rental at HUD FMR or below (see the first-rental guide for the long-term math).
• Regulation risk. Annapolis just demonstrated that STR rules change. Build a downside scenario where new STR licenses become unavailable countywide.

Local STR rules change frequently. Confirm current status with Anne Arundel County licensing, the City of Annapolis (if applicable), and your tax advisor before purchasing or operating an STR property. This guide is general information for Maryland real estate investors and is not legal, tax, or zoning advice. Evan Kundrat is a Maryland-licensed real estate salesperson (Lic. #5003434) at Keller Williams Flagship of Maryland (Designated Broker: Barry Hess, Lic. #517943). Equal Housing Opportunity.

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