Short-term rentals in Gatlinburg and Pigeon Forge: permits, zoning and safety

Gatlinburg and Pigeon Forge are the front door to Great Smoky Mountains National Park, the most visited national park in the country, and they add their own draws: Dollywood, dinner shows, outlet shopping and holiday light festivals. Demand is year-round with peaks in summer, October foliage and the Christmas season. The typical product is the mountain cabin, often with a hot tub, game room and views, ranging from one-bedroom hideaways to very large group lodges.

Who regulates what

Tennessee's Short-Term Rental Unit Act protects rentals that were legally operating before a local restriction was adopted, but that protection ends when the property is sold or transferred, after 30 months without rental use, or after three violations of general local laws. HOAs and condominium declarations may still restrict or prohibit short stays. For a buyer, this means the current zoning, not the seller's history, decides what you can do.

• Gatlinburg: overnight rentals need a city business license, a Sevier County business license, Tennessee Department of Revenue registration and the city's tourist residency permit. Zoning determines where they are allowed, so check the parcel before you buy. Owners also file a monthly gross receipts tax; the city's hotel-motel tax is usually collected by the platforms.
• Pigeon Forge: overnight rentals are allowed only in areas zoned R-2 and higher. Plans for any building that is or could become a short-term rental must carry the seal of a Tennessee-registered architect or engineer, and large homes (more than five sleeping rooms, more than twelve occupants, or above set area and height thresholds) must meet hotel-type standards, including sprinklers.
• Unincorporated Sevier County: since January 1, 2024, every short-term rental unit outside city limits needs an annual county permit followed by a yearly fire and life-safety inspection by the county fire marshal's office.

Taxes

Stays carry Tennessee sales tax plus local sales tax and city or county lodging taxes, and local business taxes apply to gross receipts. Platforms remit the lodging taxes on their bookings in most cases, not your business tax filings.

Our advice

The market is mature and competitive, so the cabin itself must stand out, but safety is where owners get caught out: steep drives, decks, hot tubs and wood stoves all need attention. Buy on the right zoning, budget for the inspection cycle and treat fire safety as the first line of your business plan. We study every request and tell you honestly whether and how we can help.