Thinking about turning a Foley property into a short-term rental? With steady tourist traffic across Baldwin County and growing interest near OWA and the coastal corridor, the numbers can look enticing. You also want clarity on permits, taxes, occupancy, and HOA rules so you avoid costly mistakes. This guide walks you through who regulates short-term rentals in Foley, the steps to register, what operating rules to plan for, and a practical checklist you can use before you buy. Let’s dive in.

What counts as a short‑term rental

Short-term rental, or STR, generally refers to renting a home or unit for brief stays, often fewer than 30 days. In Foley and unincorporated Baldwin County, STRs can be governed by municipal and county rules, plus private HOA covenants. The exact definition and permit needs can vary by zoning district and neighborhood. That is why your first step is to confirm the jurisdiction and the applicable code.

Who regulates STRs in Foley and Baldwin County

Multiple layers of rules can apply to a single property:

• City of Foley for parcels inside city limits, including planning and zoning, business licensing, and code enforcement.
• Baldwin County for unincorporated areas, including zoning, code enforcement, and county lodging taxes.
• Homeowner associations and recorded covenants, which can restrict or prohibit STRs even where the city or county allows them.
• Alabama state authorities for sales, use, and lodging tax registration and reporting.
• Federal tax rules for rental income, deductions, and depreciation.

What this means for you:

• A use that is permitted in one zoning district may be prohibited or conditional in another.
• HOA covenants are contractual and can override municipal permission on STR use.
• Failure to obtain required licenses or to register and remit lodging and sales taxes can trigger fines and back taxes, and listings can be forced offline.

Do you need a permit in Foley

Whether you need a dedicated STR permit or just a standard business license depends on current City of Foley policy. Some cities manage STRs through business licensing and lodging tax registration, while others require a specific STR permit or conditional approval. The county may also have requirements if the property is outside city limits.

Quick verification steps

• Confirm jurisdiction. Use city or county GIS or call the planning office to confirm if the parcel sits inside City of Foley limits or in unincorporated Baldwin County.
• Check zoning and overlays. Identify the zoning district and any overlays, such as coastal, floodplain, historic, or entertainment areas, which may affect occupancy, parking, or operating rules.
• Review HOA covenants. Obtain CC&Rs and written rental rules that spell out minimum stays, any registration process, parking limits, and guest conduct requirements.
• Ask about licenses. Confirm whether the City of Foley requires a business license, an STR-specific permit, or both, and whether Baldwin County has additional steps for unincorporated areas.

Permitting, registration, and taxes: step by step

Follow this lifecycle to set up a compliant STR in Foley or unincorporated Baldwin County:

1. Confirm jurisdiction. Determine if the property is inside City of Foley or in unincorporated Baldwin County.

2. Verify zoning and use. Obtain the zoning classification and confirm that short-term lodging is permitted or conditional in that district. Check for overlay districts that carry special rules.

3. Check HOA and covenants. Request recorded CC&Rs and any rental rules from the HOA or management company. Look for minimum rental periods, registration and fees, parking limits, amenity access rules, and guest behavior clauses.

4. Address building and safety. Ensure the dwelling meets building, fire, and life-safety standards for transient lodging. Bedrooms used for sleeping must meet egress and ceiling height requirements. If you plan renovations, verify permits before you build.

5. Secure local licenses. Apply for the required business license and any STR permit through the City of Foley or Baldwin County, depending on location. Be ready to provide owner contact details, a local responsible agent, a floor plan, a parking site plan, and proof of insurance if requested.

6. Register for taxes. Register with Alabama state authorities for sales and lodging tax reporting. Register with the appropriate local office for county or municipal lodging taxes if applicable, and confirm how the City of Foley handles local tax remittance.

7. Operate in compliance. Display required license or permit numbers in listings if required, maintain a 24/7 local contact, and keep accurate guest and tax records in case of audit.

Operating rules to plan for

Occupancy and safety

Occupancy limits are commonly tied to building and fire codes, often using a per-bedroom formula such as two adults per bedroom plus two. Your maximum guest count may not exceed what code allows for the number of sleeping rooms and available egress. Keep smoke detectors, fire extinguishers, and exit pathways in good working order.

Parking

Local zoning may require a set number of off-street spaces per dwelling or per bedroom. Coastal and corridor areas can have stricter parking minimums to prevent spillover onto public streets. Provide clear parking instructions in your house rules to reduce neighbor complaints.

Noise, trash, and nuisance

City and county noise ordinances, quiet hours, and nuisance rules apply to STRs. Post house rules where guests can see them, and ensure your local contact can respond 24/7 to any issue. Align trash setout with local pickup schedules and avoid overflow, which can lead to fines.

Minimum stays and disclosures

Some municipalities or HOAs set a minimum rental period, such as two or three nights, or 30 days for longer-term classifications. You may be required to post a local emergency contact and any permit numbers within your listing and inside the unit. Confirm these requirements before you publish a listing.

Enforcement and penalties

Violations can result in fines, permit or license revocation, tax liens for unpaid lodging or sales taxes, and HOA civil actions. Repeated complaints may trigger hearings and higher penalties. Proactive communication with neighbors and fast response to issues help keep the peace.

HOAs near OWA and coastal corridors

High tourist demand near entertainment and coastal areas can lead HOAs to adopt tighter STR rules. Common provisions include:

• Prohibiting rentals under a set minimum, such as 30 days.
• Requiring rental registration with the HOA and payment of a monitoring or registration fee.
• Limiting the number of rental periods per year per unit.
• Requiring a local responsible agent with 24/7 contact information.
• Restricting parking, exterior signage, and use of community amenities by guests.
• Strict noise, occupancy, and nuisance enforcement with escalating fines.

If your property is in an HOA community near OWA or closer to the coast, you may also encounter seasonal or environmental rules that affect guest instructions, such as hurricane readiness or lighting restrictions in sensitive areas. Always obtain written confirmation of the rental policy before you commit to the purchase.

Investor tips for HOA properties:

• Get it in writing. Request an official letter from the HOA that outlines rental rules and the registration process.
• Negotiate contingencies. Use a purchase contingency for STR approval if rental income is part of your plan.
• Budget for fees. Include HOA fines, registration fees, and any special insurance needs in your underwriting.

Taxes and financial compliance

Short-term rentals typically trigger multiple tax obligations:

• State taxes. Alabama sales and, where applicable, lodging or accommodations taxes on short-term stays.
• Local lodging taxes. County and municipal lodging or transient occupancy taxes may apply in addition to state taxes.
• Business license taxes. City or county business license taxes can apply to STR operations.
• Federal income tax. Rental income must be reported, and you may deduct allowable expenses and depreciation. The treatment of services and passive activity rules can affect your return.

Register and remit on time. Many jurisdictions require monthly or quarterly filings. Platforms like Airbnb or Vrbo may collect and remit certain taxes in some areas, but coverage varies. You are responsible for registering with the state and local authorities and remitting any taxes not collected by the platform.

Recordkeeping. Maintain bookings, guest names, payments, receipts for operating expenses, and tax remittance confirmations for at least several years.

Investor compliance checklist

Use this checklist to organize your setup and ongoing compliance.

Before you buy

• Confirm whether the parcel is inside City of Foley or in unincorporated Baldwin County.
• Obtain zoning confirmation that short-term lodging is permitted or conditional in the district, and check for overlay rules.
• Request HOA CC&Rs and verify any minimum-stay limits or STR prohibitions.
• Ask for copies of recorded covenants or any historic district limitations that may affect use.

After purchase, before listing

• Apply for required business license and STR permit with the applicable city or county office.
• Register for state sales and lodging taxes, and for any county or city lodging taxes.
• Verify insurance coverage that fits short-term rental use, plus liability protection as needed.
• Confirm building and fire safety compliance, including smoke detectors, egress, and fire extinguishers.
• Designate a local responsible agent and create a 24/7 response plan.
• Draft clear house rules covering occupancy, parking, trash, pets, noise, and maximum guest counts.
• Post any required disclosures and permit numbers in the listing and inside the unit if required.

Ongoing

• File and remit state and local taxes on schedule.
• Maintain booking and tax records for audits.
• Respond promptly to complaints and document your corrective actions.
• Renew your business license and any STR permit as required.
• Monitor HOA and municipal code updates, especially in tourist seasons when rules may change.

What to watch as rules evolve

Coastal tourist markets often adjust STR policies to balance visitor demand and neighborhood impacts. Expect that registration requirements, fees, or caps may change as Baldwin County and city governments evaluate trends. Platform tax collection practices can also change, so review which taxes your platform collects each year and keep your own registrations current. A quick annual check of city and county code and your HOA rules can help you avoid surprises.

Ready to evaluate a property

If you are weighing an STR purchase in Foley or unincorporated Baldwin County, a focused feasibility check can save time and money. We can help you confirm jurisdiction, zoning allowances, HOA posture on short-term rentals, and the operational items that affect your pro forma, including taxes and parking capacity. To talk through a specific address and your investment goals, connect with the owner-led team at Magnolia Land & Homes LLC.

FAQs

Does the City of Foley require a separate STR permit

• Some cities issue a specific STR permit while others manage STRs through business licenses and tax registration, so confirm the current requirement with City of Foley offices.

Can an HOA prohibit short‑term rentals even if the city allows them

• Yes, recorded CC&Rs are contractual and often enforceable, so an HOA can limit or prohibit STRs regardless of municipal allowance.

Are there caps on how many STRs can operate in a neighborhood

• Some jurisdictions use registration limits or conditional use permits to cap STRs, so verify current policy for your zoning district and neighborhood.

What occupancy and parking rules typically apply to Foley‑area STRs

• Many places use building code occupancy such as two adults per bedroom plus two and require off-street parking, so confirm the specific rules that apply to your property.

Will Airbnb or Vrbo collect all my state and local taxes

• Platforms may collect certain taxes in some jurisdictions, but you remain responsible for registering and remitting any state, county, or city taxes not collected.

What should I do before buying a property I plan to use as an STR in Foley

• Confirm jurisdiction, zoning and overlays, HOA covenants, licensing and tax registration steps, life-safety compliance, insurance, and a plan for a 24/7 local contact.