Overview: Are Short-Term Rentals Allowed in Covington, KY?

• Explicit answer: Yes. Short-term rentals (STRs) are allowed in Covington, KY, under a city-issued licensing program with specific zoning, safety, and operational rules.
• The city has implemented a comprehensive framework to balance neighborhood character, housing affordability, and business opportunity.
• STRs are categorized as:
  • Host-occupied STRs: The unit is the host’s primary residence (minimum 183 days/year).
  • Non-host-occupied STRs: The unit is not the host’s primary residence and requires a zoning permit (now typically processed as a limited use).
• Citywide caps apply to non-host-occupied licenses: 150 total historically; current framework collectively totals 151 citywide, with density limits using both historic district and neighborhood boundaries.
• STRs cannot coexist with certain uses on the same property (e.g., overnight accommodations, sober living, group living).
• Maximum stay is 29 consecutive days.
• The streamlined zoning process (limited use) reduces approval times to approximately one week, replacing the prior conditional use process that could take months.

How to Start a Short-Term Rental Business in Covington

1. Confirm Zoning Eligibility and Land Use

   • Determine your property’s zoning/character district using the Character District Map.
   • In six districts, non-host-occupied STRs are a limited use (staff-reviewed): suburban residential, semi-urban, downtown core, traditional urban mixed use, traditional urban residential, and auto urban commercial.
   • If zoning places STRs as conditional uses (or if you need a variance/design waiver/certificate of appropriateness), submit to the Board of Architectural Review and Development (B.O.A.R.D.) with required criteria and a public hearing.
   • Submit written responses to all use-specific standards for STRs in the Neighborhood Development Code (NDC).

2. Apply for Required Licenses and Permits

   • Occupational/Business License: Apply first via the city’s Finance Department.
   • Zoning Permit: Submit via the Department of Economic Development (staff review for limited uses; B.O.A.R.D. conditional use process otherwise).
   • Rental License: Submit via the online rental license portal.
   • Annual License Fee: $500; Renewal: $250; Change-of-Use Application: $80; Re-inspections: $100.

3. Safety and Insurance Requirements

   • Inspection by the Chief Building Inspector before initial issuance and at renewals.
   • Smoke detectors required in each tenant room and hallway; carbon monoxide alarms on each floor.
   • Maintain liability insurance covering tenant injury or death.
   • Comply with building and property maintenance codes.

4. Parking Compliance

   • Off-street parking: one space per tenant room (on-site or within the residential parking program boundary), or:
   • Provide one residential parking pass per tenant room, or
   • Demonstrate sufficient on-street parking (at least one space per tenant room within 600 feet).

5. Operational Limits

   • Maximum four tenant rooms per STR.
   • Each tenant room limited to two adults over 18 years old.
   • Maximum two STRs per structure (citywide regulation).
   • Non-host-occupied operator cap: up to four licenses per person.
   • Single-family dwellings limited to two occupants maximum; not applicable to multifamily or other structures unless explicitly defined by code.

6. Post-Approval Operations

   • Annual license renewal and inspections.
   • Address nuisance reports via Code Enforcement; violations can result in license revocation.
   • Out-of-town hosts must employ a local agent for responsiveness.
   • “Three-strike rule” for code violations; penalties include fines and one-year ban for operating without a license.

Required Documents, Permits, Licenses, and Guidelines

• Documents

  • Exterior property photos and site plan.
  • Written answers to all STR use-specific standards (per NDC).
  • Liability insurance certificate.
  • Proof of ownership or lease agreement.
  • Local agent designation (if applicable).

• Permits and Licenses

  • Occupational/Business License (Finance Department).
  • Zoning/Design Permit (Economic Development) or B.O.A.R.D. application (conditional use/variance/design waiver/certificate of appropriateness).
  • Annual Short-Term Rental License (rental license portal).
  • Inspection by the Chief Building Inspector prior to issuance and at renewal.

• Application Portals and Submission

  • Rental license application portal: covingtonky.portal.iworq.net/portalhome/covingtonky
  • Zoning permit application submission: portal.iworq.net/COVINGTON/new-permit/600/4053

Specific Regulations for Short-Term Rentals (City, County, State)

• City of Covington (Chapter 127 and NDC)

  • Definitions
    • STR: A residential dwelling or part thereof offered to tenants for ≤29 days per calendar year via hosting platforms, excluding hotels/motels, B&Bs, resorts, boarding houses.
    • Host-occupied STR: Primary residence (≥183 days/year).
    • Non-host-occupied STR: Not the host’s primary residence.
  • Registration and Licensing
    • Required before advertising or renting; annual renewal.
  • Prohibitions
    • STRs not permitted on the same property as overnight accommodations, sober living, or group living use types.
  • Tenure
    • Tenant stay limited to 29 consecutive days.
  • Occupancy and Unit Limits
    • Maximum four tenant rooms; two adults over 18 per room; maximum two STRs per structure.
  • Safety
    • Smoke detectors and CO alarms required per code; inspection required prior to license and at renewal.
  • Signs
    • One wall sign, max one square foot, only if signage is otherwise permitted.
  • Insurance
    • Maintain liability insurance for tenant injury/death.
  • Parking
    • One off-street space per tenant room (on-site or within residential parking program), or one residential parking pass per tenant room, or demonstrate sufficient on-street parking within 600 feet.
  • Density and Licensing Caps
    • Non-host-occupied STRs capped citywide: 151 total (balanced across historic and neighborhood boundaries).
    • Non-host-occupied license limit: up to four per person.
  • Enforcement
    • Code violations handled by Code Enforcement; “three-strike rule”; operating without a license triggers penalties and a one-year ban on new applications.
  • Appeals
    • Rental License Appeal Board hears appeals on violations/denials; neighbors may appeal license grants; nuisance enforcement post-licensure.

• Kenton County

  • County-level STR-specific statutes were not identified in the provided content; consult county planning/zoning for overlapping or additional requirements.

• State of Kentucky

  • Kentucky-level statutes and administrative regulations specific to STRs were not identified in the provided content; engage state revenue/tax guidance for state-level tax obligations and compliance if applicable.

Contact Information for Local Authority in Charge of STRs

• City of Covington – Department of Economic Development
  • Address: 20 W. Pike St., Covington, KY 41011
  • Phone: (859) 292-2122
  • Email: permit@covingtonky.gov
  • Website: www.covingtonky.gov
• Zoning/Design Permit Application (submission): portal.iworq.net/COVINGTON/new-permit/600/4053
• Rental License Application (portal): covingtonky.portal.iworq.net/portalhome/covingtonky
• General Contact
  • Phone: (859) 292-2160
  • Email: info@covingtonky.gov

Links to Source Pages (IMPORTANT)

• City streamlines process for obtaining STR license (June 20, 2024): www.covingtonky.gov/news/2024/06/20/city-streamlines-process-for-obtaining-short-term-rental-license
• City to issue new short-term rental licenses (June 29, 2023): www.covingtonky.gov/news/2023/06/29/city-to-issue-new-short-term-rental-licenses
• Zoning/Design Permit Application Guide and STR Use-Specific Standards (PDF): thecovky.gov/wp-content/uploads/2022/12/STRs-Process.pdf
• Rental License Application Portal: covingtonky.portal.iworq.net/portalhome/covingtonky

Notes for Investors

• The limited-use zoning change substantially reduces approval times (as little as one week) and changes the decision-making from B.O.A.R.D. to staff in designated districts.
• The fee restructure ($500 annual license; $250 renewal; $80 change-of-use application; $100 re-inspections) improves cost clarity and aligns fees with inspection/administrative costs.
• Density limits and licensing caps are actively managed to protect residential character and housing affordability; investors should verify current caps by district/neighborhood before acquisition.
• Compliance infrastructure (inspections, insurance, parking, signage) must be in place prior to license issuance and maintained for renewal.
• If your property falls within a historic district or requires design review, anticipate additional review criteria and processes via B.O.A.R.D. (public hearings, application completeness requirements, and fees).