Short-term rentals across Indiana: lakes, dunes and small towns

Outside its cities, Indiana has several distinct rental landscapes. The Indiana Dunes along Lake Michigan draw Chicago-area families in summer. The glacial lakes of the north, around Lake Wawasee and the Steuben County chain, fill cottages from Memorial Day to Labor Day. In the south, Brown County and the village of Nashville are a fall-color destination, and Lake Monroe, the Ohio River towns and French Lick add their own seasons. Rentals range from lake cottages and A-frame cabins to farmhouses and small-town homes.

The state rule everywhere

Indiana's statute on short-term rentals applies statewide to towns, cities and counties alike. A rental of your primary residence is a permitted residential use. For a second home or investment property, the local government may require a special exception, special use or variance in residential zones, as long as it does not use that tool to prohibit or unreasonably restrict rentals. Regulations must serve listed purposes such as safety, sanitation, traffic, noise and nuisance control, and local permits are capped: one year, no more than $150 initially, no renewal fee.

Why our atlas says License

Resort areas are where Indiana's special exception tool is most likely to be used, by lakeside towns, counties and conservancy districts alike. The statute even allows a local government to limit or prohibit short-term rentals inside the boundaries of a conservancy district, a structure that manages several lakes. For that reason we class the rest of Indiana as License: expect some form of local approval and check it parcel by parcel.

Taxes

Indiana sales tax and the county innkeeper's tax apply to stays under 30 days. Each county sets its own innkeeper's rate, and some lake and tourism counties are active in collecting it. Platforms cover their own bookings in most cases; repeat guests who book directly, common in cottage country, are your responsibility.

Before buying a cottage or cabin

• Identify the zoning authority: town, county, or an area plan commission covering both.
• Ask whether the property lies in a conservancy district and what its rules say.
• Read lake association and HOA covenants; many predate the rental boom.
• Check septic capacity against the guest count you plan to advertise.
• Plan for a short season: in lake country, summer carries the year.

Our advice

Rural Indiana can be a good place for a second home that pays its way, but only with the local approval secured and the season priced honestly. We study every request and tell you honestly whether and how we can help.