Can You Buy an Airbnb in Destin? The Quick Answer
Yes, you can purchase a short-term rental property in Destin, but significant restrictions apply. STRs are only allowed in specific beachfront high-rise zones, the city has maintained a moratorium on new transient rental licenses for years, and you'll need to acquire an existing license from a current owner to operate legally. This makes Destin a challenging market compared to other Florida beach destinations—but not impossible if you're willing to work within tight constraints.
Where Are STRs Actually Allowed in Destin?
Destin's STR market is geographically limited. According to the City of Destin Zoning Ordinance § 27-402, transient rentals are permitted only in specific zones:
- Beachfront High-Rise (BHR) zone — the primary location for legal STRs
- Limited commercial zones — with additional restrictions
- Residential areas — generally not permitted
This zoning restriction means that if you're considering a residential beach cottage or a home in a traditional residential neighborhood, STR operation is likely off the table. The vast majority of Destin's legal STR inventory consists of furnished condos and apartments in beachfront high-rise buildings. Before you shop, verify that any property you're interested in falls within an approved zoning district—your real estate agent should confirm this, but it's worth checking the city's zoning map yourself.
Do You Need a License to Rent in Destin?
Absolutely. Every STR in Destin must have a valid transient rental license issued by the City of Destin Planning Department. But here's the critical catch: the city has imposed a moratorium on issuing new licenses.
According to the City of Destin Planning Department, the moratorium means that existing license holders are grandfathered in and can renew annually, but new licenses are only available if you purchase a property from a current STR owner and acquire their released license. This creates a secondary market where you're essentially buying the license along with (or separate from) the property itself.
What does this mean for you as a buyer? You cannot simply purchase a beachfront condo and start renting it immediately. You must:
- Buy a property that already has an active STR license, or
- Negotiate to acquire a released license from an existing operator (which may involve additional costs)
- Complete the license transfer process through the Planning Department
Contact the Destin Planning Department at (850) 837-8989 to confirm the current moratorium status and license availability before making an offer.
What Are the License Costs and Fees?
Beyond the property purchase price, budget for several licensing and regulatory fees. According to the City of Destin Fee Schedule and Okaloosa County requirements:
- Initial Application Fee: Approximately $200–$300 (administrative processing)
- Annual License Renewal Fee: Approximately $600–$800 per year
- License Transfer Fee: Approximately $500–$1,000 (if acquiring a released license from an existing owner)
- Okaloosa County Business Tax Receipt: Approximately $50–$100
Additionally, you'll need to carry appropriate property insurance. Standard homeowner's policies typically exclude short-term rental use, so expect to pay a premium for STR-specific coverage. Plan on these costs being built into your annual operating expenses.
What Taxes Will You Owe on Rental Income?
This is where Florida's tax advantage shines—but Destin still requires several levies on your rental revenue. Here's what to expect:
Tourist Development Tax (Bed Tax)
According to the Okaloosa County Tourist Development Council, you must collect and remit a 5% Tourist Development Tax on all nightly rental revenue. Additionally, Okaloosa County imposes a 0.5% Emergency Management Sales Surtax, bringing the total to approximately 5.5% in taxes owed to the county. These are typically remitted monthly or quarterly. Your property must also be registered with the Tourist Development Council before you begin operations.
Income Tax
Florida has no state income tax—a significant advantage. However, you will owe federal self-employment and income taxes on your net rental profits. Keep meticulous records of income and expenses (mortgage interest, insurance, maintenance, utilities, management fees) to minimize your tax liability.
Property Tax
Here's an important detail: if you use your property as an STR, you cannot claim a homestead exemption. According to the Okaloosa County Property Appraiser, STR properties are classified as commercial/transient rentals, which typically have higher assessed rates than primary residences. Budget for standard property tax at approximately 0.87–0.92% of assessed value, but confirm the exact rate with the county before purchasing.
Are There Occupancy, Noise, or Parking Rules?
Yes, and they vary depending on your specific building and the city code.
Occupancy Limits
Most beachfront buildings set occupancy limits based on square footage and building code. A typical 1-bedroom might allow 2–4 guests, a 2-bedroom 4–6 guests, and a 3-bedroom 6–8 guests. However, many condo buildings have their own stricter HOA rules. Always review the HOA documents and building bylaws before purchasing—some buildings now limit the number of rental days per year or require owner-occupancy for part of the year.
Noise Ordinance
According to the City of Destin Noise Ordinance § 27-271, noise limits are 65 decibels during the day and 60 decibels at night (10 PM–7 AM). Violations can result in fines up to $500 and potential license revocation for repeat offenders. This is enforced by the Okaloosa County Sheriff's Office.
Parking
Beachfront high-rises typically require 1–2 parking spaces per unit, but guest parking is often limited or charged separately. Street parking for guests is generally not permitted. Your building's HOA rules will dictate parking policies more strictly than city code.
What's Changed Recently, and What Should You Watch For?
The biggest recent development is the ongoing license moratorium, which has been in place for several years. This dramatically reduces the pool of available properties for new STR investors. Beyond that, many individual condo buildings have tightened their own rental restrictions—some now ban rentals altogether or limit them to a certain number of days per year.
Before you commit to a purchase, contact the Destin Planning Department and request the most current information on license availability and any pending regulatory changes. Also review the City Council meeting agendas to stay informed about proposed changes.
Is Destin a Good STR Investment Market?
Destin has strong tourist demand and high nightly rates, but the regulatory environment is restrictive. Average nightly rates range from $120–$180 for a 1-bedroom in low season to $200–$350 in high season, depending on exact location and amenities. However, the license moratorium means limited inventory and fewer opportunities to enter the market compared to other Florida beach towns.
If you can acquire an existing licensed property, the fundamentals are solid. But if you're starting from scratch, you may want to explore other Florida short-term rental markets with fewer barriers to entry.
Next Steps: Buying an STR in Destin
Before making any offer, you should:
- Verify that any property is in an approved STR zoning district
- Confirm that an active license is transferable or available
- Request the license transfer agreement and any associated costs in writing
- Review the building's HOA documents and rental policies
- Get a pre-purchase inspection that includes STR-specific compliance
- Consult a real estate attorney familiar with Destin STR regulations
- Have a CPA review the tax implications specific to your situation
Ready to explore buying an STR in Destin or another Florida market? Learn how to evaluate and purchase a short-term rental property, or use our STR investment calculator to model your potential returns.
Disclaimer: STR regulations change frequently and vary by location. This guide reflects information available as of 2024, but municipal codes are subject to change. Before purchasing any property, confirm current zoning, licensing, and tax requirements directly with the City of Destin Planning Department and Okaloosa County. Consult a licensed real estate attorney and tax professional to ensure compliance with all local, state, and federal regulations.