Short-term rentals on South Padre Island.

For the Texas hotel occupancy tax, a short-term rental is a stay of 29 days or less in a house, condo, apartment or room. A guest who stays 30 consecutive days or more is generally exempt as a permanent resident. Port Isabel and unincorporated Cameron County are separate jurisdictions from the City of South Padre Island, so confirm the rules where your property is.

• Short-term rental properties are registered with the city and the permit is renewed through the city’s online tax account.
• Owners remit the city’s hotel occupancy tax every month through the same system.
• The city publishes the owner or agent and a 24-hour contact phone for each registered short-term rental.
• The city can suspend or revoke a short-term rental license after repeated violations by guests, such as noise, parking or overcrowding. Ask how the building and the property manager screen guests and handle complaints.

• State tax: 6% of the room price. If you book only through a platform that agrees to collect the state tax, the platform remits it.
• If you book on your own website or a platform that does not collect it, you collect and remit the state tax yourself.
• Local tax: South Padre Island adds local hotel occupancy taxes on top of the state’s, paid to the city. Ask the city for the current combined rate.
• Income tax on the rent is separate: 30% of gross rent by default for a nonresident, or tax on net income with the election. See the tax guide.

Many island properties are condos or homes in an association with its own rules. Read them during the option period, not after closing.

• Whether nightly rentals are allowed, and any minimum stay.
• Rental registration with the association, and guest rules.
• Monthly dues, what they cover and any planned special assessments.
• The association’s master insurance, and what you must insure yourself.

• Wind and hail: Cameron County is in the coverage area of the Texas Windstorm Insurance Association. TWIA covers wind and hail only, generally for owners a private insurer has turned down.
• Flood: a separate policy. Check the property on FEMA’s flood maps.
• Short-term rental use: ask your insurer whether the policy covers nightly guests and liability.

Get quotes before your option period ends: insurance can change the numbers more than any other line.

If you live in Mexico, a manager can handle cleaning, guest communication, maintenance and tax filings. In Texas, someone who leases property for others for pay generally needs a real estate license, so ask for the license number and a written agreement, and check the license on the TREC website.

Island demand changes with the season, so test a conservative average. Include cleaning, platform fees, furniture, utilities, HOA dues, insurance and hotel taxes, and use a higher vacancy than for a long-term lease.

We do not publish occupancy rates or nightly prices without a source we can verify. Ricardo can pull comparable listings for a specific property. Open the calculator.