Short-term rentals in Hot Springs, Arkansas: a capped residential market

Hot Springs has been a resort town for more than a century, and it still sells the same mix: thermal bathhouses along Bathhouse Row inside Hot Springs National Park, lakes Hamilton, Catherine and Ouachita for boating and fishing, and the live racing season at Oaklawn from winter into spring. Summer lake weekends, the documentary film festival in the fall and holiday breaks keep the rest of the year active. Rentals include historic houses near downtown, lake homes and condos on Lake Hamilton, and cabins in the surrounding Ouachita foothills.

The residential door is closed for now

Hot Springs licenses short-term rentals and splits the city into two regimes:

• Residential zones are subject to a citywide cap of 400 licenses. The city states that, as of July 1, 2025, new licenses in residential zones are not available.
• Commercial and mixed-use zones have no cap, and applications there are still accepted.
• Condominiums recorded before January 18, 2022, and one preservation district are treated separately and exempt from the cap.

Licenses run for the calendar year in which they are issued. Some rentals also need a special use approval, and neighbors can object through a published process. A certificate of occupancy inspection is now needed only when the maximum occupancy changes, and a 24-hour hotline takes complaints.

This goes further than our atlas, which described conditional approval for non-owner-occupied rentals in residential zones. The binding fact for a buyer today is the exhausted cap.

Taxes

Arkansas applies its state sales tax and a 2% tourism tax to lodging rented for less than a month, and Hot Springs adds local sales and advertising and promotion taxes. Platforms handle part of this; direct bookings require your own registration and returns.

Outside the city

Much of the lake shoreline lies in Garland County outside city limits, and Hot Springs Village to the north is a private gated community with its own rules. Each has its own logic, so check the jurisdiction and the covenants before assuming anything.

Our advice

If you want to buy a residential house inside the city to rent nightly, assume there is no license available unless the city confirms otherwise in writing. Look instead at commercially zoned properties, pre-2022 condos, or areas outside the city, and read the covenants. We study every request and tell you honestly whether and how we can help.