Short-term rentals in Ocean City, explained properly.

Section 14-174(a) requires the application to include a consent to inspection during reasonable hours for the whole license term and a declaration of the number of bedrooms and the required or approved on-site parking. Under 14-174(c) the Division of Rental Housing issues or denies a license within 14 days after reviewing it with the building official, zoning administrator, license inspector and fire marshal; it may deny a license for false statements, noise violations that were not fixed, or failure to comply with the Code, after at least ten days' written notice and a chance to be heard. The Rental Hub says new applications are accepted in person or by mail only and that new licenses must schedule a rental inspection within 30 days.

Section 14-174(f) makes licenses renewable for one-year terms subject to the fee, certification that taxes are paid, and compliance with all applicable laws; 14-174(d)(2) requires the owner to certify that all federal, state, county and municipal taxes on the rental are paid before each license or renewal.

Section 14-174(h) requires the license to be displayed inside condominium, single-family and cooperative rental units; 14-174(i) requires owners to record all rentals, keep the records for at least five years, display emergency contact information in the unit, include the license number in all advertisements and listings, and not advertise more bedrooms than the approved building permit plans allow.

Section 14-174(k). Continued renting by a new owner without a license is treated as consent to the license terms, including inspection.

Section 14-177 sets the overnight limit, which may never exceed the occupancy allowed under the property maintenance code (Chapter 10) or the building's fire-protection limits (Chapter 34). The Town's Rental Hub explains that in all other zoning districts occupancy is calculated from floor area (40 square feet per person, with bedroom minimums, plus two additional occupants), and that only legally permitted bedrooms count.

Section 14-174(e) allows inspection before a license is issued on a reviewing agency's recommendation and requires inspection during the license term when a Town, county or state agency believes the property is not in compliance; rentals must keep their required on-site parking available to renters. The Rental Hub says single-family homes, duplexes, townhouses and condo units are inspected by Planning and Community Development on a random five-year rotation.

Section 14-176(a) lets the City Manager suspend a rental license for up to 30 days for breaching license conditions, failing to comply with the Code, unlawful activity or nuisance, or three documented calls for service or citations in a twelve-month period; 14-176(b) lists grounds for revocation. Hearings and appeals follow section 14-38(c)-(d). A suspended or revoked unit cannot lawfully be rented (14-174(e)(2)f).

Section 14-175(a) makes any violation of the rental housing article a municipal infraction subject to the penalties in section 1-8, with each day a separate violation and ten days' written notice to correct first. The $5,000 amount is from the Town's Rental Hub; section 1-8 was not read.

Section 11-101 of the Tax-General Article defines a short-term rental as the temporary use of a short-term rental unit (a residential dwelling unit or part of one, including a house, apartment, condominium or cooperative) to provide accommodation to transient guests for lodging purposes in exchange for consideration, and lists both an accommodation (a right to occupy a room or lodgings as a transient guest) and a short-term rental as tangible personal property. Section 11-104(a) sets the general sales and use tax rate at 6 cents for each exact dollar of the taxable price. The Comptroller of Maryland's 2016 tax alert on accommodations says that individuals who rent out their homes or rooms are accommodations providers who must register with the Comptroller and collect the tax, that the tax does not apply to monthly or permanent residents, and that all rentals in resort areas for terms of 4 months or less are subject to the tax. Local room or hotel taxes are shown on each place's page.

Section 11-101 defines a short-term rental platform as an Internet-based digital entity that advertises short-term rental units and is paid for facilitating reservations or processing booking transactions for the owner, operator or manager, and lists a short-term rental platform as a vendor. Section 11-403(a)(5) says sales include a booking transaction made through a short-term rental platform, and 11-403(b) requires a vendor to collect the sales and use tax from the buyer. Under 11-101(l)(5), when a platform facilitates a stay, the taxable price is the full amount the guest pays, not counting any tax remitted to a taxing authority; a commission paid by the host after the booking is not included. The Comptroller's 2016 alert says hosting platforms that collect payments on behalf of an owner must register and collect the tax, and that an owner's duty to collect is waived only when the platform gives the owner a resale certificate. A 2025 law (Chapter 638) rewrites these definitions from July 1, 2027 so that an accommodations intermediary includes a short-term rental platform. The sources read do not say whether a host who books through a platform that collects must still file returns; check with the Comptroller.

Chapter 9 of the 2026 Laws of Maryland (House Bill 1221) added Public Safety Article sections 9-1101 to 9-1106, effective October 1, 2026. They apply only to a short-term rental unit offered for less than 30 consecutive days. The host must conspicuously post an evacuation diagram identifying all exits and a list of emergency numbers for police and fire rescue, and provide a working fire extinguisher and working smoke and carbon monoxide alarms. Booking services must electronically notify hosts of these requirements and require each host to provide the inspection confirmation for each unit. By July 1, 2028, each county and Baltimore City must, by local law or regulation, require annual inspections of all short-term rental units for these requirements (this does not apply to a county that prohibits short-term rentals) and may charge an inspection fee. The law does not require a county or Baltimore City to allow short-term rentals and does not preempt other local measures. In the 2026 session, House Bill 993 (local rules on short-term rentals run by tenants) passed the House; its last action shown, on April 13, 2026, was Second Reading Passed in the Senate, and it has no chapter number.