The Ongoing Battle Over Short-Term Rental Rules in New Orleans

Short-Term Rentals in New Orleans: A Community Balancing Act

Walking through the heart of Treme or down the lively streets of the French Quarter, it’s impossible to ignore the impact of short-term rentals on New Orleans. Locals see familiar houses transformed for travelers and visitors, making the city’s age-old charm feel a little different every year. Conversations at coffee shops often drift toward housing, affordability, and what it means to call New Orleans home as neighborhoods continue shifting.

Over the last ten years, the City Council has steadily refined regulations around short-term rentals—homes offered for thirty days or fewer—in an effort to address residents’ quality of life concerns while also respecting property owners’ desire to rent out their spaces through platforms like Airbnb or VRBO. The ongoing challenge? Finding an approach that keeps communities vibrant and accessible without shutting the door on potential income for local homeowners.

A Look at Current Rules for Short-Term Rentals

After legalizing short-term rentals back in 2016, New Orleans set out specific requirements for residential hosts. Anyone renting their home for under a month needs a valid city permit—without it, the rental is considered illegal. Perhaps the standout regulation is the one-block rule: within each city block zoned for residences, only a single property may obtain a permit. If too many apply, the city conducts a lottery, leaving luck to decide. Corporate owners are not permitted to obtain these residential licenses, and individuals may only hold a single permit for their own property.

Every permitted property has to have a manager or operator living on-site full time. The logic is simple: if the owner is local, they can respond quickly when issues come up, like emergencies or neighborhood disturbances. Notably, some cherished historic areas—the French Quarter and parts of the Garden District—are completely off-limits for new short-term rental permits, protecting some of the city’s most valuable legacy spaces.

Are There Special Circumstances?

Tweaks to the rules have happened over the years, especially regarding density. At one point, an amendment allowed up to two additional exceptions for a single city block. By December of last year, these exceptions were paused, but the city is still processing requests made before that deadline.

Critics, including local housing advocates, have argued that the approval process for these exceptions lacked clear standards. Reports suggest that city leaders often overruled the advice of their own City Planning Commission, approving nearly all exceptions that reached them—even those that contradicted neighborhood planners’ recommendations. This left many feeling that the process should be more transparent and consistent.

Why Are Airbnb and Local Hosts Taking the City to Court?

In early 2025, Airbnb and several local property owners filed a federal lawsuit, arguing New Orleans’s recent rules restrict property rights under both the U.S. and Louisiana constitutions. The heart of the complaint is that tough city ordinances prevent hosts from legally renting to guests and prevent them from earning the full value from their homes.

The legal challenge also targets rules that make rental platforms, like Airbnb and VRBO, responsible for enforcing city regulations. New ordinances require these companies to take down unpermitted listings and regularly share data on rentals with city officials—a move Airbnb claims invades user privacy and oversteps what a local government can require of private businesses.

“We never imagined we’d have to file a lawsuit against the city we love and call home, but the never-ending onerous regulations have put our livelihood at risk,” said one of the plaintiffs in a public statement.

For Airbnb, the new standards are not just strict—they represent what the company describes as “the most extreme short-term rental restrictions on hosts in the country.” At the core, they argue these requirements are both novel and unconstitutional.

How the City Handles Enforcement Today

Even as new laws have emerged, enforcement has become a sticking point. While data from early 2025 shows about 2,500 licenses issued—with more than half in residential neighborhoods—estimates from independent researchers suggest thousands of rentals in New Orleans still operate without the proper permit. The gap between licenses and active listings highlights an enforcement challenge that has frustrated residents and city officials alike.

In response, city administrators have called for reforms and clearer guidelines. Internal reports described a short-term rental office struggling to keep up, with insufficient staff to oversee the mounting caseload. That’s led city leaders to push some of the enforcement burden onto hosting platforms, directing companies to self-police and remove unlicensed listings themselves.

Some city leaders frame this as basic accountability—a practical way to preserve neighborhoods and local interests. Critics counter that it places an unfair regulatory burden on private companies. Regardless of position, it’s clear the city is still searching for an effective balance between robust enforcement and the practical realities of limited resources.

Airbnb, on its end, points to its online resources and City Portal—which have let city staff monitor regulation compliance since 2020—as evidence of its willingness to partner. However, platform representatives say ongoing confusion and coordination challenges remain.

What Happens Next for Short-Term Rentals in New Orleans?

The shape of the city’s short-term rental sector now hinges on the outcome of ongoing legal battles. Airbnb’s lawsuit follows a 2019 court case centered around requiring property owners to prove residency in their rental homes—a rule that drew fire from some local hosts. Although the city prevailed in that instance, the decision is now under appeal.

One city council leader has made it clear: if courts rule that New Orleans can’t enforce meaningful restrictions, there’s a real possibility of an all-out ban on short-term rentals. Legislation authorizing such a move has been drafted and is set to remain on the council’s agenda until the dust settles in federal court.

State politics also play into the local debate. Several proposed bills in Baton Rouge over the past year would have made it harder for cities like New Orleans to regulate short-term rentals or control platforms such as Airbnb. None of these bills have become law as of February 2025, but the conversation in the statehouse is far from over—industry lobbyists remain active, and lawmakers are watching the outcomes of these high-profile legal fights closely.

The city’s journey with short-term rentals captures a larger picture: a community striving to preserve its neighborhoods, protect affordable long-term housing, and offer opportunities for property owners to benefit from tourism. There are no simple answers, just an unfolding story in which every player—from city leaders and homeowners to neighbors and guests—shapes what New Orleans will look like in the years ahead.