Short-Term Rental (STR) Investor Guide for Orem, Utah

1. Overview: Are Short-Term Rentals Allowed in Orem, UT?

Explicit Answer: No. Short-term rentals are currently prohibited in all residential zones in Orem, UT.

Key Background: Orem has maintained a ban on "transient lodging" (rentals less than 30 days) in residential areas since 2002. This ban classifies STRs as commercial lodging (equivalent to hotels/motels), incompatible with residential neighborhoods. However, the city is actively debating regulatory changes (as of March 2025), including potential licensing programs with occupancy limits and operational standards.

Critical Enforcement Note: Utah courts have consistently upheld cities' rights to enforce zoning bans against STRs, even after periods of non-enforcement. Operating an STR now risks immediate legal action, fines, and forced shutdowns.

2. How to Start a Short-Term Rental Business in Orem

Current Reality: Starting an STR is not legally viable until Orem adopts new regulations. If you proceed now, you operate in direct violation of city code. Future Regulatory Path (Under Debate):

1. Monitor City Council Meetings: Track proposed ordinances via Orem City Council Agendas (citizenportal.ai linked meeting videos).
2. Prepare for Licensing: Expect a mandatory city STR permit with annual renewal.
3. Adopt Compliance Systems: Implement safety measures (smoke/CO detectors), parking plans, and noise monitoring.
4. Designate Local Contact: Assign an Orem-based agent within 1-hour response time.

3. Required Documents, Permits, Licenses, and Guidelines

Currently Required (for Legal Operation): None – STRs are banned. Anticipated Requirements (Based on Draft Proposals):

• Business License/STR Permit: Application, fee, and annual renewal.
• Zoning Compliance: Proof property is in an approved STR zone (likely limited residential areas).
• Safety Inspection:
  • Smoke detectors in all bedrooms/hallways.
  • Carbon monoxide detectors per level.
  • Fire extinguisher.
• Operational Plans:
  • Occupancy limits (proposed: 2 guests/bedroom, max 8).
  • Parking details (e.g., 1 space/bedroom).
  • Quiet hours (likely 10 PM).
• Advertising Compliance: Display license number in all online listings.
• Tax Registration: Remit Utah County’s 3% transient room tax.

4. Specific Regulations: City, County, and State

City of Orem (Current)

• Zoning Ban (2002): Prohibits all transient lodging (<30 days) in residential zones.
• Enforcement: Complaint-driven. Violations trigger fines and injunctions.
• Active Proposals (2025):
  • Tiered occupancy caps (2 guests/bedroom, max 8).
  • Complaint-driven revocation of licenses.
  • Fines for unlicensed ads/listings.

Utah County

• Transient Room Tax: 3% on all STR bookings (handled via state systems).
• Unincorporated Areas: Follow county ordinances (similar to Orem’s residential bans).

State of Utah

• Definition: STR = rental ≤30 consecutive days.
• HB256 (2024): Allows cities to use online listings combined with other evidence for enforcement.
• No Statewide Ban: Municipalities retain full authority to regulate/ban STRs.
• Building/Fire Code: STRs >10 occupants require commercial R-1 occupancy compliance (sprinklers, alarms, exits).

5. Local Authority Contact Information

City of Orem

• Planning & Zoning Department:
  • Phone: (801) 229-7500
  • Email: Not provided – use city contact form.
  • Website: Orem.gov/Planning
• City Attorney’s Office: (801) 229-7100
• Report Violations: Non-emergency police line (801) 229-7070.

Utah County

• Transient Room Tax: Contact the Utah State Tax Commission:
  • Website: tax.utah.gov
  • Phone: (801) 297-2200

6. Source Links

• Historical Ban & Legal Precedent: Brendon Beebe’s STR Ordinance Analysis
• 2025 Council Debates: Citizen Portal AI Article on Orem STR Proposals
• State Tax Code: Utah Code §17-50-338 (Transient Room Tax)
• Utah County STR Overview: TruStay Property Management Guide

Key Recommendations for Investors

1. Avoid Immediate Investment: Operating now risks legal action.
2. Advocate for Balanced Regulations: Attend city council meetings to support responsible host provisions (e.g., primary-residence exemptions).
3. Prepare for Compliance: Invest in safety equipment and operations manuals now to streamline future licensing.
4. Monitor Shifts: Watch for updates in Q2 2025 as Orem finalizes its ordinance.

Disclaimer: Laws evolve rapidly. Consult Orem’s planning department before investing.