Vacation Rental Investment in Anacortes, WA

The Ordinance, Stated Plainly

The City of Anacortes defines a short-term rental as overnight lodging -- not a hotel, motel, or bed and breakfast -- in which a dwelling unit or portion of one is offered to a guest for a fee for fewer than 30 consecutive nights. Since a 2019 ordinance, short-term rentals of this kind have not been permitted in the city's residential zones. In March 2024, the City Council went further, adopting an ordinance -- effective April 2, 2024 -- prohibiting new short-term rentals in the Commercial, Central Business District, Marine Mixed Use, and Commercial Marine zones as well. Short-term rentals that were already licensed and operating in those commercial-side zones before the ordinance were grandfathered in and may continue, provided they maintain a current city business license and comply with parking and other applicable requirements, but new licenses are not being issued in any of these zones under current rules.

Put together, that means the two broad categories of zoning where a short-term rental might otherwise make sense -- quiet residential neighborhoods, and commercial/downtown/marina-adjacent districts -- are both now effectively closed to new licensing in Anacortes. This is a meaningfully more restrictive posture than many other markets this site covers, where short-term rental regulation tends to focus on permit caps, occupancy taxes, or neighborhood-specific overlays rather than a near-total prohibition on new licenses citywide.

Why This Matters More Here Than in a Typical Beach Town

In many of the ocean-beach and waterway markets this site covers, a buyer can reasonably model a vacation home's ownership cost being partially or fully offset by short-term rental income during peak season, with the property used personally the rest of the year. That model does not work in Anacortes for a newly purchased property under current rules -- a buyer who purchases property without an already-existing, transferable short-term rental license should assume, based on the ordinance as confirmed, that they cannot obtain a new short-term rental license for that property, regardless of its zoning designation within the four commercial/marine zones or any residential zone.

This is worth stating plainly because it changes the entire investment thesis: a property in Anacortes should generally be evaluated as either a long-term rental (30-plus-night tenancy, governed by Washington's separate landlord-tenant law rather than short-term rental rules), a personal residence or second home, or, in the narrow case of a property with a valid, existing, grandfathered short-term rental license already attached, a genuine short-term rental investment -- but not as a blank-slate short-term rental opportunity the way it might be modeled in a market without these restrictions.

Buying an Already-Licensed Property: The One Real Path

For a buyer specifically seeking short-term rental income in Anacortes, the realistic path is purchasing a property that already carries a valid, transferable, grandfathered short-term rental license from before the applicable prohibition dates -- 2019 for residential zones, April 2024 for the four commercial/marine zones. Before making an offer on any property marketed with short-term rental income potential, confirm directly with the City of Anacortes' business licensing office that the specific license is current, valid, and legally transferable to a new owner, rather than relying on a listing description's claim. A license that has lapsed, or that was tied to the prior owner rather than the property itself, may not convey the way a buyer assumes, and this page did not confirm the exact transferability mechanics of Anacortes' grandfathered licenses this research pass.

Long-Term Rental Remains a Real, Viable Alternative

Given the short-term rental restrictions, a buyer seeking rental income from Anacortes property should seriously evaluate a long-term rental model instead -- a 30-day-or-longer lease governed by Washington's Residential Landlord-Tenant Act, which sets statewide rules around security deposits, notice periods, and eviction procedures distinct from short-term rental regulation entirely. Anacortes' genuine, established local economy -- the March Point refineries, the Port of Anacortes, Island Hospital, and the Anacortes School District among them -- provides a real, ongoing base of local renters, not solely a seasonal tourist market, which can make a long-term rental strategy more stable here than in a purely vacation-driven coastal town.

Where the STR Math Could Still Work: Adjacent Markets

A buyer specifically committed to a short-term rental strategy in this general area might reasonably look beyond Anacortes' own city limits to unincorporated Skagit County or nearby Whidbey Island communities, where short-term rental regulation may differ from Anacortes' own ordinance -- but this page did not research or confirm the current short-term rental rules for those separate jurisdictions this pass, and a buyer pursuing that route should treat it as a genuinely separate research task, not an assumption carried over from Anacortes' own rules.

What This Page Does Not Know

This page does not have confirmed data on how many currently grandfathered short-term rental licenses exist in Anacortes today, confirmed transferability mechanics for those licenses upon a property sale, or confirmed current short-term rental occupancy-tax rates applicable to any still-operating licensed rental. It also does not have confirmed short-term rental regulations for unincorporated Skagit County or neighboring jurisdictions, which were not part of this research pass.

Before making any purchase decision premised on short-term rental income, confirm the specific property's license status, transferability, and any applicable occupancy tax directly with the City of Anacortes' business licensing office, and consult a local real estate attorney or property manager experienced with Anacortes' specific ordinance.