Executive Summary: Are STRs Allowed in Lone Tree?

YES – Short-term rentals are explicitly allowed in Lone Tree, Colorado, but under a strict regulatory framework. As of February 2023, Lone Tree City Council approved comprehensive ordinances that permit STRs with significant restrictions focused on maintaining residential neighborhood character. The city has implemented a licensing program, primary residence requirements, occupancy limits, and operational standards to balance economic opportunities with community impacts.

How to Start a Short-Term Rental Business in Lone Tree

Step 1: Determine Eligibility

• Primary Residence Requirement: STRs are restricted to primary residences only. You must live in the property as your principal home.
• One Rental Per Dwelling: Each dwelling unit is limited to one short-term rental operation.
• Zoning Compliance: STRs are permitted on any residentially-zoned property, subject to licensing requirements.

Step 2: Secure Proper Licensing

• Obtain a short-term rental license through the City Clerk's office
• Secure a business license and sales tax license
• Maintain compliance with all local, state, and federal regulations

Step 3: Designate Authorized Agent

• Appoint an authorized agent who must be located within 50 miles of the STR property
• Agent must be accessible within two hours of contact from city officials or staff
• Agent responsible for addressing complaints and ensuring compliance

Step 4: Insurance and Financial Preparation

• Obtain liability insurance for the property
• Establish system for collecting and remitting lodging taxes
• Prepare for annual license renewal fees

Required Documents, Permits, Licenses, and Guidelines

Essential Documentation

1. Short-Term Rental License Application (City Clerk's Office)
2. Business License
3. Sales Tax License
4. Proof of Lawful Possession (deed or title documentation)
5. Liability Insurance Certificate
6. Authorized Agent Designation Form
7. Primary Residence Affidavit (sworn statement)

Compliance Documents

• Building, Electrical, and Fire Code Compliance Certification
• Maximum Occupancy Documentation (based on bedroom count)
• Parking Plan (must comply with city requirements)
• Tax Compliance Affidavit (affirming current tax obligations)

Ongoing Requirements

• Annual license renewal
• Sales and lodging tax collection/remittance
• Compliance monitoring
• Complaint response protocols

Specific Regulations: City, County, and State Level

Lone Tree City Regulations (Primary Jurisdiction)

Licensing Requirements

• License Required: No person may advertise or operate an STR without a valid city license
• Annual Renewal: License term follows annual renewal cycle
• Suspension/Revocation: Licenses can be suspended or revoked for non-compliance

Primary Residence Restrictions

• Owner-Occupancy Required: Only properties serving as the owner's primary residence qualify
• One STR Per Dwelling: No more than one short-term rental per dwelling unit
• Affidavit Required: Owner must submit sworn statement confirming primary residence status

Occupancy Limits

• Maximum Occupancy: Two persons per bedroom, excluding children under 5 years of age
• Example: Four-bedroom house = maximum 8 adults plus children under 5
• Prohibition on Overcrowding: No conversions of living spaces (dining rooms, living rooms) into sleeping areas

Authorized Agent Requirements

• Proximity: Must be located within 50 miles of STR property
• Accessibility: Must respond within two hours of city contact
• Responsibilities: Handle complaints, ensure compliance, manage operations

Parking Regulations

• On-Street Limitation: Maximum of two overnight parking spaces on public streets
• On-Property Parking: No limit on vehicles parked on private property
• Compliance: Parking must not block driveways, sidewalks, or neighboring access

Operational Standards

• Code Compliance: Must meet all building, electrical, and fire codes
• Inspections: City authorized to inspect premises for compliance (complaint-driven enforcement)
• Noise and Nuisance: Subject to disturbance of peace regulations
• Advertising Requirements: All STR advertisements must include city license number

Tax Obligations

• Sales Tax: Required collection and remittance
• Lodging Tax: City lodging tax collection and remittance
• Property Tax: Current property tax payments required for license approval

Douglas County Context

• Municipal Jurisdiction: Lone Tree is an incorporated city with its own STR regulations
• County Overlay: County regulations apply only in unincorporated areas, not within Lone Tree city limits
• HOA Considerations: Homeowners associations may impose additional restrictions beyond city requirements

Colorado State Regulations

• Business License Requirements: Standard Colorado business licensing applies
• Sales Tax Compliance: Colorado state sales tax collection and remittance requirements
• Health and Safety Standards: State fire, building, and health codes apply
• Fair Housing: All STR operations subject to federal fair housing law compliance

Enforcement and Compliance

Complaint-Based Enforcement

• Primary Enforcement: Complaint-driven investigation system
• Show-Cause Hearings: Multiple nuisance complaints may trigger license review
• No Proactive Inspections: City does not conduct routine proactive inspections of all properties

Violation Consequences

• License Non-Renewal: Failure to comply may result in license denial during renewal
• Suspension/Revocation: Operating privileges can be suspended or permanently revoked
• Administrative Process: Violations handled through administrative procedures

Good Neighbor Requirements

• Guidelines Compliance: Adherence to Good Neighbor Guidelines required
• Community Impact: Operations must minimize impacts on residential neighborhood character
• Event Restrictions: Large gatherings and events that disturb peace prohibited

Contact Information

Lone Tree City Government

• City Clerk's Office: Primary contact for STR licensing
• City Hall: (Contact information not provided in sources)
• City Website: Official city website for forms and current regulations
• City Attorney's Office: Linda Michow, City Attorney (contact details not provided)

Key Departments

• Licensing Division: Handles STR license applications and renewals
• Code Enforcement: Investigates violations and complaints
• Planning/Zoning: Zoning compliance questions
• Building Department: Safety and code compliance verification

Recommended Initial Contacts

1. City Clerk's Office: For licensing requirements and applications
2. Planning Department: For zoning and compliance questions
3. Building Department: For safety code compliance requirements

Additional Considerations for STR Investors

Market Analysis

• Regulatory Climate: Friendly but highly regulated environment
• Competition: Limited by primary residence requirement, reducing investor pool
• Neighborhood Integration: Must maintain residential character standards

HOA and Neighborhood Restrictions

• Additional Restrictions: Homeowners associations may prohibit STRs entirely
• Covenants Review: Essential to review HOA covenants and bylaws before purchase
• Neighborhood Character: Operations must respect existing neighborhood standards

Financial Considerations

• License Costs: Annual licensing fees (specific amounts not provided)
• Tax Obligations: Sales and lodging tax collection requirements
• Insurance Costs: Higher liability insurance premiums for STR operations
• Compliance Costs: Potential costs for code upgrades and safety equipment

Source Links and References

• Lone Tree STR Discussion: Colorado Community Media - Lone Tree Council Discusses Short-Term Rentals
• Douglas County Context: Highlands Ranch Herald - Douglas County STR Regulations
• Lone Tree Real Estate Perspective: Engle Homes Group - Lone Tree STR Overview

Important Note: This guide is based on available information from 2022-2025 sources. STR regulations can evolve rapidly. Always verify current requirements directly with Lone Tree City Hall before making investment decisions or initiating licensing processes.

Disclaimer: This guide provides general information only and should not be considered legal advice. Consult with qualified legal and tax professionals familiar with Colorado STR regulations for specific guidance.