Key West STR Rules: 28-Day Minimum & Capped Transient Licenses

Key West is structurally hostile to typical Airbnb-model STR. The city's '28+1' rule — 28-day minimum stay across most residential zones, with limited exceptions — was specifically designed to blunt Airbnb's growth. The legal short-stay pathway is a Transient Rental License (TRL), available only in defined Historic High Density Residential (HHDR) and certain commercial zones, and the TRL pool has been capped at the existing licenses for over a decade. Buying into Key West short-stay STR means buying a property that already holds a TRL, at a premium that often reflects $100,000–$300,000+ of permit value.

Licensing & Registration

Florida DBPR Vacation Rental License is the state floor. Key West-specific layer: properties operating stays under 28 days require a Transient Rental License from the city. New TRLs have not been issued in the standard pool since the 2009 cap. The city occasionally re-issues lapsed TRLs, but availability is essentially zero for new market entrants. Buying a property with a TRL in place is the practical path; the TRL transfers with the property under proper paperwork.

Lodging & Occupancy Taxes

Florida state sales tax 6% + Monroe County tourist development tax 5% + Monroe County impact fee 1.5% = 12.5% effective lodging tax for stays under 6 months. Key West charges no separate municipal lodging tax. Airbnb collects state and county taxes; operators booking off-platform must self-register with Monroe County's tax collector.

Penalties & Enforcement

Operating short-stay rentals without a TRL: $1,000 per day, escalating with offense count. Key West code enforcement is unusually active given the small geography (about 4 square miles) and the high economic stakes for compliant TRL holders, who actively report violations. Repeat violators face civil suits from the city.

Recent Changes

2024 Monroe County hurricane code updates added storm-shutter and roof-anchor requirements that affect older properties. Compliance costs $15,000–$40,000 typical; required at next major remodel or sale. 2025 city council reaffirmed the 28-day rule and TRL cap.

Tax Strategy for Compliant Investors

Even where Key West's rules constrain inventory, properly-licensed STR investors retain the full federal tax stack. Cost segregation accelerates depreciation, and the STR loophole can let losses offset W-2 income for materially-participating owners. See cost segregation for Airbnb properties for the playbook.

Frequently asked questions