The short answer
Generally yes, outside strict towns
Outside town limits, Plotnomics found no county ban on short-term rentals: register for occupancy tax and check HOA covenants. Inside Highlands, new rentals are restricted.
- Property tax
- 0.32%
- of market value a year
- Occupancy tax
- 3%
- paid by guests
- Towns covered
- 2
- Highlands, Franklin
Outside town limits
In Franklin and unincorporated Macon County, short-term rentals are treated as a normal residential use; no extra permit beyond occupancy tax registration.
Town by town
Town limits matter more than the mailing address: many lots with a town address are actually in the county.
Highlands
RestrictedHighlands bans new short-term rentals in its R-1 and R-2 residential zones (since Sept 2022); rentals operating then are grandfathered. The 2027 phase-out was voided in a Dec 2025 settlement. Other zones allow limited use.
Franklin
AllowedFranklin treats short-term rentals as a permitted residential use; town occupancy tax applies.
Taxes
Property tax (about 0.32% a year)
County rate 27¢ per $100 (2025-26) plus a typical fire district (about 5¢). Towns add their own rate.
Occupancy tax (3%)
3% county occupancy tax (Franklin adds its own 3%). Plus NC sales tax on rentals (4.75% state + local, about 6.75% total).
Check before you buy land here
- Zoning and the short-term rental rules for the exact parcel (town limits matter more than the mailing address).
- HOA covenants and deed restrictions: they can ban rentals even where the county allows them.
- Septic: a county soil evaluation and improvement permit for the bedrooms you plan.
- Year-round legal road access, and a recorded easement if it isn't on a state road.
- Slope: steep lots can add $50k–150k in site work, driveway and foundation.
- Well depth and power: ask neighbours and the electric co-op what it cost them.
Researched October 2026. Rules change often and this isn't legal advice: confirm with Macon County and the town before you buy.