Short-Term Rental Regulations in New Orleans and Louisiana: What Hosts Must Know

The New Orleans Short-Term Rental Battle

Few cities in America have had a more contentious history with short-term rental platforms than New Orleans. The city's combination of a booming tourism economy, a housing affordability crisis, and strong neighborhood preservation advocacy has made short-term rental (STR) regulation a persistently contested policy and legal battleground. Property owners, platforms, neighborhood groups, and the city government have been in recurring conflict over STR rules for nearly a decade.

Current New Orleans STR Framework

New Orleans's short-term rental ordinance framework has been revised multiple times following litigation, council action, and referendum. The current framework generally includes the following elements, though the specific rules are subject to ongoing legal and political change and should be verified with current city code:

• License requirement: STR operators must obtain a short-term rental license from the City of New Orleans. Operating without a license subjects the owner to fines and potential enforcement action.
• Residential STR vs. Commercial STR: The city distinguishes between owner-occupied STRs (where the owner lives on the premises) and non-owner-occupied commercial STRs, applying different and more restrictive rules to the latter.
• Geographic restrictions: Certain historic neighborhoods and residential areas have had commercial STRs prohibited or severely restricted following community pressure and litigation.
• Neighborly approval requirements: At various times, the city has required neighborhood notification or approval for STR licenses — requirements that have been challenged in court as an unconstitutional delegation of government authority to private parties.
• Hotel taxes and remittance: STR operators must collect and remit applicable hotel/lodging taxes to state and local authorities.

State Preemption Issues

One of the recurring legal questions in New Orleans STR regulation is the extent to which Louisiana state law preempts or limits the city's authority to regulate short-term rentals. Louisiana's Home Rule Charter, the Local Government Finance Act, and various state statutes create a complex interplay between state and local authority. Operators and platforms have at various times argued that certain city STR restrictions exceed the city's home rule authority — with mixed results in litigation.

Constitutional Challenges

New Orleans STR regulations have faced multiple constitutional challenges, including:

• Due process and equal protection challenges to geographic restrictions that treat different neighborhoods differently
• Takings challenges arguing that prohibitions on STR use constitute a regulatory taking requiring compensation
• First Amendment challenges to advertising restrictions
• Challenges to neighborly veto provisions as an unconstitutional delegation of legislative authority to private citizens

Litigation in both state and federal courts has produced injunctions, remands, and legal uncertainty that makes the current legal status of specific STR rules an ongoing question requiring current legal research.

Other Louisiana Municipalities

STR regulation is not unique to New Orleans. Other Louisiana municipalities — including Baton Rouge, Lafayette, and various coastal communities — have enacted or are considering STR regulations. The legal framework for municipal authority to regulate STRs under Louisiana law provides the foundation for analyzing whether any specific regulation is enforceable.

Practical Guidance for Property Owners

For Louisiana property owners considering or currently operating short-term rentals:

• Verify the current licensing requirements for your specific address before listing on any platform
• Collect and remit all applicable state and local lodging taxes
• Review your homeowners insurance policy — most standard homeowners policies do not cover commercial STR use, and a separate STR policy or endorsement is needed
• Review your mortgage — some mortgages prohibit commercial use of the property
• Monitor local ordinance changes, which occur frequently in this area