Texas Short-Term Rental Rules, City by City (Verified July 2026)
Program and regulatory figures verified July 24, 2026. Details change; confirm your scenario with us.
Buying a short-term rental in the wrong Texas zone is a six-figure mistake. This is the city-by-city status table we check before writing a single loan: dated, sourced, and updated when the courts move.
The 2026 status table
| City | Status (as of July 24, 2026) | Cost | Key rules |
|---|---|---|---|
| Austin | Legal in ALL residential zones with license | $836.30 new / $385.30 renewal, 2-yr | 2 units per SF lot; 1,000-ft spacing; multifamily 10%; platform delisting live 7/1/26 |
| Dallas | 2023 ban ENJOINED, never enforced; SCOTX pending | n/a while enjoined | Operating legally; re-check docket before you buy |
| Fort Worth | Banned in single-family residential zoning (upheld 3/2025) | $150 initial / $100 annual where allowed | Zoning ban held up in court; buy outside SF zones only |
| Houston | Legal citywide; registration required since 1/1/2026 | $275 + $33.10 admin, annual | First-ever ordinance; number in listings; enforcement since 4/1/26 |
| San Antonio | Legal with permit | T1 $300 / T2 $450 per 3-yr term (renewal same fee) | Type 2 capped at 12.5% per block face; 1 unit in MF under 8 units |
| Galveston | Legal with registration | $250 annual (renew Dec 1–31) | GVR number in all ads; 15% total hotel occupancy tax |
| New Braunfels | Prohibited in residential zones; SUP elsewhere | varies by SUP | $500K liability insurance; annual fire inspection (Sec. 144-5.17) |
| Fredericksburg | No NEW entire-home STRs in R1/R2/R3 since 1/1/2024 | permit required | Pre-April-2022 permits grandfathered |
Fees and statuses verified July 24, 2026 against city sources; three of these regimes are in active litigation or first-year rollout. Confirm current rules with the city before purchase.
There is no Texas statewide STR law
The 89th Legislature adjourned in 2025 without passing an STR preemption statute; a marketplace bill (HB 2767) moved in committee and died. Until at least the 2027 regular session, every city writes its own rules, which is why this table exists. The state's role is the hotel occupancy tax: 6% on stays under 30 days, with city and county HOT stacked on top (Galveston reaches 15% total; San Antonio runs 9% city plus 1.75% Bexar County). Budget HOT as an operating cost; underwriting uses gross rent before occupancy tax.
The pattern in the Texas STR cases
Put the rulings side by side and a rule of thumb emerges. Austin's ban on existing non-homestead STRs was struck as an unconstitutional retroactive law (Zaatari, 2019), and its owner-occupancy requirement fell in federal court in 2023. Fort Worth's zoning-based ban on new STRs in single-family districts was upheld in March 2025. Dallas sits in the middle: its 2023 ban is enjoined, twice upheld on appeal, and now waits on the Texas Supreme Court. Texas courts protect operators who were already running legally; they defer to cities zoning out future ones. For a buyer, that means an existing licensed operation carries real grandfather value, and a bet on converting a newly-bought house in a restrictive zone carries real legal risk.
Hill Country + Canyon Lake: the septic angle
New Braunfels prohibits STRs in residential zones and requires a special-use permit in most others, with $500,000 in liability coverage and an annual fire inspection. Fredericksburg stopped issuing entire-home permits in its R1–R3 zones in 2024; permits issued before April 2022 are grandfathered. But unincorporated Canyon Lake has no city zoning at all; the constraint nobody mentions is the septic system. Comal County treats an STR as a "change of use" on an on-site sewage facility, and a home whose OSSF was permitted for a family can be forced into a commercial-grade upgrade to operate legally. We flag it because a septic redesign can cost more than the permit fight it replaces. Financing for all of these: Texas STR loans.
No pressure, no obligation, and no salesy follow-up: a 20-minute call with our team, real numbers, and a straight answer on whether the deal pencils.
Frequently asked questions
Are short-term rentals legal in Austin in 2026?
Yes: in every residential zone, with a license. Austin's 2025 ordinance made STRs an allowed accessory use citywide: $836.30 new license, two-year term, up to two units per single-family lot. Since July 1, 2026, platforms must delist unlicensed properties. The "Austin ban" the internet remembers was struck down in 2019.
Is Airbnb banned in Dallas?
No. Dallas passed a ban in 2023, but courts enjoined it before enforcement began, the injunction was upheld on appeal in 2025, and the Texas Supreme Court is now considering the case (as of July 2026). STRs operate legally in Dallas today, but that answer carries a date, and we re-check the docket before every Dallas STR loan.
Does Houston require a short-term rental permit?
Yes: new for 2026. Houston's first STR ordinance took effect January 1, 2026: each unit needs an annual Certificate of Registration ($275 plus $33.10 admin fee), the registration number must appear in listings, and enforcement began April 1, 2026. There is no zoning ban in Houston.
Can I run an Airbnb in Fort Worth?
Only outside single-family residential zoning. Fort Worth's ban on STRs in SF zones was upheld in court in March 2025, making it the Texas proof that zoning-based bans hold up. Where STRs are allowed, registration runs $150 initially and $100 a year.
What do I need to rent my Galveston beach house short-term?
An annual registration ($250, renewed December 1–31), a GVR number displayed in every listing, and hotel occupancy tax collection at 15% total. The city took over STR oversight from the Park Board on October 1, 2025, and updated its ordinance in late 2025; check the current version before listing.
Do New Braunfels or Canyon Lake allow short-term rentals?
New Braunfels prohibits STRs in residentially-zoned districts and requires a special-use permit in most others, plus $500,000 liability insurance and an annual fire inspection. Unincorporated Canyon Lake has no county zoning ban, but Comal County septic rules treat STR conversion as a change of use that can force a commercial-grade system upgrade.
Mike Certo · NMLS #260555 · Cornerstone First Mortgage NMLS #173855 · Equal Housing Lender. Educational content, not a loan commitment and not legal or tax advice. City STR rules and tax figures change; verify current requirements with the city, your CPA, or a Texas real estate attorney before you buy. Loans are subject to buyer and property qualification.