Key Takeaways

• Woodland Park requires STR owners to use the property as their primary residence in residential zones, following a voter-approved ordinance that passed with roughly 60% support in December 2023.
• Castle Rock has no town-specific STR permit, but HOA restrictions and business license requirements still apply, and unincorporated Douglas County imposes separate fees.
• Pueblo requires a short-term rental license and may require special use permits depending on zoning, with a combined minimum sales tax rate of 7.6%.
• Manitou Springs enforces a 2% cap on total STR units, a 185-day owner-occupancy rule, and a 500-foot separation requirement between properties.
• Every mountain town collects sales and lodging taxes independently, so your obligations change based on your property’s exact location.

Four Colorado mountain towns within driving distance of Colorado Springs each take a completely different approach to short-term rental regulation. Woodland Park passed a voter-approved ordinance restricting STRs to primary residences. Castle Rock barely regulates them at all. Pueblo is building its framework from the ground up. And Manitou Springs caps the total number of permits at 2% of its housing stock.

If you own property in any of these markets, or you are thinking about buying, the rules that apply to your rental depend entirely on which town your property sits in. This guide breaks down each town’s requirements, compares them side by side, and explains the tax obligations you will face across all four locations. For broader context on Colorado’s regulatory environment, the Colorado STR regulations overview covers statewide trends.

Why Mountain Town STR Rules Differ From Colorado Springs

Colorado gives cities and towns broad authority to set their own short-term rental policies, which means regulations can shift dramatically from one municipality to the next. There is no statewide STR license. Each jurisdiction decides whether to cap permits, require owner occupancy, impose zoning restrictions, or take a hands-off approach.

“Colorado’s home-rule municipalities have significant latitude to regulate land use within their borders,” notes Baker Law Group, a firm specializing in Colorado real estate law. “That local control is why you see such wide variation in STR ordinances across the Front Range and mountain communities.”

Colorado Springs, for example, requires registration and collects lodging tax but does not cap permits or mandate owner occupancy. But drive 20 minutes west to Woodland Park or south to Manitou Springs, and the regulatory picture changes entirely.

This patchwork system means you cannot assume what works in one town will work in another. Even neighboring jurisdictions like the Town of Castle Rock and unincorporated Douglas County apply different fee structures and requirements to the same type of property.

Woodland Park: Primary Residence Requirement and Voter-Approved Restrictions

Woodland Park voters approved Ordinance 1469 in December 2023 with approximately 60% support, making it one of the few Colorado communities where residents directly voted to restrict short-term rentals. The ordinance’s core rule is straightforward: in residential zones, you can only operate an STR if the home is your primary residence.

Non-primary-residence STRs are still allowed, but only in commercially zoned areas. The city later passed Ordinance 1472 (Series 2024), which amended Title 5 business regulations to create a formal licensing process for STR operators.

Licensing and Fees

Woodland Park uses a two-step system. First, you apply for a permit through the Planning Department, which verifies your location, parking, and occupancy limits. Second, you obtain a business license from the city. The annual business license costs $35, and you must collect and remit monthly sales and lodging tax.

A short-term rental in Woodland Park is defined as any dwelling unit rented for fewer than 30 consecutive days. Existing license holders received a one-year transition period to come into compliance with the new rules.

A legal challenge to the ordinance was dismissed in April 2025, according to city records published on woodlandpark.gov, which solidified the voter-approved restrictions.

Revenue Potential

Despite the tighter rules, Woodland Park still performs well as an STR market. According to AirROI’s 2026 data, the town’s 241 active listings generate an average of $37,662 per year, with a $292 average nightly rate and 46.6% occupancy. Revenue per available room (RevPAR) sits at $132. July is the strongest month, while February is the softest.

“Mountain markets near Colorado Springs tend to attract weekend and holiday travelers year-round, with summer and fall driving the bulk of revenue,” says a market analyst at AirROI. “Woodland Park’s proximity to Pikes Peak keeps demand consistent even with regulatory constraints.”

Those numbers make Woodland Park competitive with many Front Range STR markets. Properties with cabin-style appeal near Colorado Springs tend to command premium nightly rates, especially during peak season.

For the full breakdown of permit steps, zoning maps, and compliance deadlines, see the Woodland Park STR Ordinance page.

Castle Rock: Minimal Town Regulation With HOA Oversight

Castle Rock takes the lightest regulatory approach of any town in this group. The Town of Castle Rock does not require a specific STR permit or license. There is no cap on units, no owner-occupancy requirement, and no special zoning restrictions for vacation rentals.

That does not mean you can list a property without any paperwork. You still need a town business license, and you must collect and remit lodging and sales tax. But compared to Woodland Park or Manitou Springs, the barrier to entry is low from a municipal standpoint.

The HOA Factor

The real gatekeepers in Castle Rock are homeowners associations. Castle Rock is dominated by planned communities, and many HOAs prohibit or severely restrict short-term rentals. Before you buy a property or list an existing one, check your HOA covenants carefully. A violation can result in fines, legal action, or forced delisting.

“In communities like Castle Rock, HOA restrictions often matter more than city ordinances,” notes Proper Insurance, a provider specializing in STR coverage. “Hosts need to verify their CC&Rs allow short-term use before investing in furnishings or marketing.”

Carrying the right insurance for short-term rentals is especially important in HOA-governed communities, where liability disputes can escalate quickly.

Town vs. County Distinction

If your property falls in unincorporated Douglas County rather than within Castle Rock’s town limits, different rules apply. Douglas County charges a $500 application review fee, a $130 license fee, and a $270 annual renewal fee, according to the county’s official STR page on douglasco.gov. That is a significant cost difference from the town’s simple business license requirement.

Always confirm whether your property is within town limits or in unincorporated county territory. The distinction affects your fees, your application process, and your ongoing compliance obligations. The Castle Rock Vacation Rental Permits page walks through both scenarios.

Pueblo: Emerging STR Framework With Licensing Requirements

Pueblo requires a short-term rental license before you can list a property, and depending on your zoning district, you may also need a special use permit. The regulatory framework is still taking shape, so staying current with city updates is essential.

What You Need to Apply

To obtain a Pueblo STR license, you must submit proof of ownership or a lease agreement, proof of insurance, and a completed application. The city allows STRs in certain residential, agricultural, and business zone districts, but not all. Check with the Pueblo Planning Department to confirm your property’s eligibility before investing in a listing.

Tax Rates

Pueblo’s tax obligations add up. The city sales tax rate is 4.75%, and the lodger’s tax is 4.3%. When you factor in the 2.9% state sales tax and 1% county tax, your combined minimum sales tax rate reaches 7.6%. Understanding what you need to know about sales tax when renting short-term can help you price your property correctly and avoid surprises at tax time.

“Hosts who underestimate their tax obligations often end up underwater in their first year,” says a compliance specialist at BNBCalc, a platform that tracks STR regulations nationwide. “In markets like Pueblo, where combined rates exceed 7%, accurate pricing is critical to maintaining positive cash flow.”

Because Pueblo’s framework is still evolving, new requirements could emerge. Monitoring the city’s official channels and working with a local property manager can help you stay ahead of changes. Full details are on the Pueblo Airbnb Regulations page.

Manitou Springs: Strict Caps and Owner-Occupancy Rules

Manitou Springs enforces the tightest STR regulations of any town in this guide. The city caps short-term rentals at 2% of total residential units, which translates to roughly 56 permitted STRs based on the 2013 residential base count. If that cap is full, you cannot get a new permit regardless of how well your property qualifies.

Requirements at a Glance

To operate an STR in Manitou Springs, you must meet all of the following:

• Owner occupancy: Live in the property at least 185 days per year.
• 500-foot separation: Your STR must be at least 500 feet from any other permitted STR.
• Planning Commission approval: You need approval before you can begin operating.
• City business license: Required before you list on any platform.
• Minimum rental activity: Rent the property at least 21 days per calendar year.
• Non-transferable permits: Your permit expires if you sell or transfer the property. Permits are renewed annually and are tied to the owner, not the address.

The city provides an STR Web Map on manitouspringsco.gov that lets you check whether your address falls within 500 feet of an existing permitted rental.

Revenue Data

Despite the tight supply, Manitou Springs STRs generate strong returns. AirDNA reports an average annual revenue of $37,090, with a $164 average daily rate and 64% occupancy. The limited supply and high tourist demand from Pikes Peak visitors, Garden of the Gods traffic, and the Incline hiking crowd keep occupancy rates well above many competing markets.

For a closer look at what a Manitou Springs vacation rental looks like in practice, Hoste manages properties in the area that consistently perform at or above market averages.

The complete permitting process and eligibility criteria are covered on the Manitou Springs Rental Rules page.

Side-by-Side Comparison: Mountain Town STR Requirements

Tax Obligations Across Colorado Mountain Towns

Every STR operator in Colorado owes state sales tax at 2.9%, but local rates vary by jurisdiction. Pueblo’s combined minimum rate of 7.6% is the highest among these four towns. Woodland Park and Manitou Springs each add their own sales and lodging taxes on top of the state rate.

Castle Rock collects lodging and sales tax through the town’s standard business license process. If your property is in unincorporated Douglas County, check the county’s rate schedule on douglasco.gov, as it differs from the town’s rates.

Colorado does not have a statewide lodging tax, according to the Colorado General Assembly (content.leg.colorado.gov). Each municipality sets its own. This means your total tax burden depends on your property’s exact location, not just which county it sits in.

For a deeper look at how these rates affect your bottom line, the Airbnb revenue data for the Colorado Springs area includes tax-adjusted return calculations.

How Hoste Helps Mountain Town Property Owners

Managing an STR across these four towns means tracking different permits, different tax rates, different zoning rules, and different renewal timelines. Hoste’s full-service vacation rental management handles compliance, tax collection, multi-platform distribution, and around-the-clock guest support so you do not have to manage every detail yourself.

Whether your property is a cabin in Woodland Park, a townhome in Castle Rock, or a historic cottage in Manitou Springs, Hoste builds a management plan around your town’s specific requirements.

Want to see what your property could earn? Get a free earnings estimate from the Hoste team.

Frequently Asked Questions

Do I need a special STR permit in Castle Rock?

No. The Town of Castle Rock does not require a specific short-term rental permit. You do need a standard town business license and must collect lodging and sales tax. However, check your HOA covenants, as many Castle Rock communities restrict or prohibit short-term rentals entirely.

Can I operate an STR in Woodland Park if I do not live there full-time?

Only if your property is in a commercially zoned area. Ordinance 1469, approved by voters in December 2023, restricts STRs in residential zones to properties that serve as the owner’s primary residence. This rule was upheld after a legal challenge was dismissed in April 2025.

How many STR permits does Manitou Springs allow?

Manitou Springs caps STR permits at 2% of total residential units, which comes to roughly 56 permits based on the 2013 residential base. When the cap is full, no new permits are issued until an existing permit is not renewed or a property is sold.

What taxes do I owe as a Pueblo STR host?

Pueblo STR operators owe a 4.75% city sales tax, a 4.3% lodger’s tax, a 2.9% state sales tax, and a 1% county tax. The combined minimum rate is 7.6%. Additional special district taxes may apply depending on your property’s location.

Is my Manitou Springs STR permit transferable if I sell the property?

No. Manitou Springs STR permits are owner-specific and non-transferable. The permit expires when the property is sold or transferred, and the new owner must apply for a new permit, subject to the 2% cap and all eligibility requirements.

What is the difference between Castle Rock town rules and Douglas County rules?

The Town of Castle Rock requires only a business license for STRs. Unincorporated Douglas County charges a $500 application review fee, a $130 license fee, and a $270 annual renewal fee. Confirm whether your property is within town limits or in unincorporated territory before applying.

How much can I earn with an STR in Woodland Park?

AirROI’s 2026 data shows Woodland Park’s 241 active listings averaging $37,662 per year, with a $292 nightly rate and 46.6% occupancy. July is the peak month, and RevPAR averages $132 across the market.

Do I need Planning Commission approval for a Manitou Springs STR?

Yes. Manitou Springs requires Planning Commission approval before you can operate a short-term rental. You must also obtain a city business license, meet the 185-day owner-occupancy rule, satisfy the 500-foot separation requirement, and rent the property at least 21 days per year.

Ready to start earning from your mountain town property? Get your free earnings estimate from Hoste and find out what your home could generate with professional management and full regulatory compliance.