Aspen Colorado's Short-Term Rentals: What Every Buyer & Renter Needs to Know | Avant Garde Aspen Luxury Real Estate

Aspen’s luxury real estate market is not just about owning a home—it’s also about maximizing rental potential. Whether you’re a homeowner considering renting out your property or a traveler looking for the perfect Aspen getaway, understanding Aspen’s short-term rental market is essential. Here’s what you need to know about short-term rentals in Aspen, including legal regulations, investment opportunities, and rental demand trends.

Are Short-Term Rentals Allowed in Aspen?

Yes, but they are heavily regulated. Aspen has strict short-term rental (STR) laws to balance tourism with local housing needs. In December 2021, the city passed new regulations requiring homeowners to obtain a permit for short-term rentals. There are three types of STR permits:

1. Lodging Exempt Permit – For commercial properties like hotels and lodges. 

   • Available to managers of lodging and condo-hotel properties which meet the definition of “lodge” or “condo-hotel” per Ordinance No. 9, Series 2022.
   • No annual limit on the number of nights per year the STR may operate.
   • Not limited by number in any zone district where STRs are a permitted use.
   • Only one permit is required for all units under management.
   • Batch filing of taxes is allowed.
   • Business licenses required for the qualified owner’s representative as well as the owner of each property covered under the single permit. 
   • Individual owners of units at lodge or condo-hotel properties are not eligible for the Lodging Exempt Permit and must apply for a Classic or Owner-Occupied Permit.
   • Purchasing a property in Aspen's lodging district, usually condos on the side of Durant closest to the mountain, are in this category. 

2. Owner-Occupied STR Permit – For primary residences rented for up to 120 nights per year.

   • Available to title property owners who reside in their City of Aspen residential property as their primary residence.
   • Limited to 120 STR rental nights per year.
   • Not limited by number in any zone district where STRs are a permitted use.
   • Property owner name is required on the application; LLCs without a verifiable name of a natural person will not be accepted.
   • Permittee must submit two pieces of documentation indicating that the STR address is the permittee’s primary residence. Acceptable documents include valid driver's license, valid motor vehicle registration, current voter registration, or federal or state tax return from the current filing period. Documents MUST be issued to the STR permittee at the STR address listed on the application. 
   • Business licenses required for the permittee and qualified owner’s representative. 

3. Classic STR Permit – For non-owner-occupied properties, often requiring additional compliance measures.

• • Available to non-owner occupied OR owner-occupied residential properties.
  • No annual limit on the number of nights per year the STR may operate.
  • Limited by number in certain residential zone districts; new applicants will be subject to a waitlist in zones with capped numbers of available STR-C Permits.
  • Property owner name required on the application; LLCs without a verifiable name of a natural person will not be accepted.
  • Business licenses required for the permittee and qualified owner’s representative. 

Tip: Before buying a property with rental income in mind, check the latest STR permit regulations here.

How Do I Get a Short-Term Rental Permit in Aspen?

If you’re a homeowner looking to rent your property short-term, you’ll need to apply for a permit through the City of Aspen. The requirements include:

• Proof of ownership and residency (if applicable)

• Compliance with zoning and safety regulations

• Payment of STR taxes (ranging from 2% - 5% occupancy tax)

The city also requires annual permit renewals, so staying compliant is essential.

What’s the Rental Potential for Properties in Aspen?

Aspen’s short-term rental market is lucrative, with demand peaking during ski season (December to March) and summer (June to September).

Average Rental Rates for Aspen Vacation Homes:

• Luxury condos in Aspen Core: $800 - $3,000/night, $15-50K+/month

• Ski-in/Ski-out Chalets: $2,500 - $10,000/night, $50-100K+/month

• Exclusive Mountain Estates: $10,000 - $30,000+/night, up to $350-400K+ / month

High-end homes with ski access, modern amenities, and concierge services command the highest rental rates. Investors can expect occupancy rates of 70-90% during peak seasons.

Where Are the Best Neighborhoods for Short-Term Rentals?

Some Aspen neighborhoods are more rental-friendly than others. Here’s where short-term rentals perform best:

1. Aspen Core – The most walkable, high-demand location for luxury condo rentals.

2. Red Mountain – Exclusive homes with breathtaking views and privacy.

3. The West End – Historic charm with easy downtown access.

4. Snowmass Village – More affordable ski-in/ski-out rental options.

5. East Aspen – A mix of modern estates and secluded properties with great appeal.

Should You Buy an Aspen Home as a Rental Investment?

For buyers looking to invest, Aspen remains one of the top-performing luxury rental markets in the U.S. However, consider these factors:
✔️ Permits & Regulations – Not all properties qualify for STR permits.
✔️ Maintenance Costs – High-end homes require luxury-level upkeep.
✔️ Property Updates – Renters usually prefer something modern, clean, and turnkey, that is well designed.
✔️ Property Management – Many owners use professional STR managers due to the city’s strict compliance laws, and many up valley in Aspen and Snowmass can cost a lot. 

Key Takeaways:

1. Short-term rentals are legal but heavily regulated – Make sure your property qualifies for an STR permit.

2. High demand, high returns – Aspen’s luxury vacation rentals generate significant income, especially in peak seasons.

3. Neighborhood matters – Properties in the Aspen Core, Red Mountain, and Snowmass Village (in winter) perform the best.

4. Work with an expert – Whether buying or renting, consulting a real estate professional ensures compliance and maximized returns.

Thinking about investing in Aspen’s rental market? Contact us today for exclusive listings and rental property insights: Stephanie Kroll, 303.345.5886 | [email protected]