Every Frisco listing pitched as an income property assumes something the ordinance does not allow. The seller's short-term rental license, the one behind those tidy gross-revenue printouts in the offering package, is extinguished the moment the deed records. The buyer inherits the four walls, the HOA dues, the property taxes, and a spot at the back of a waitlist.
That single mechanic is the most important line item in any Frisco STR underwriting model, and it is almost never on the marketing sheet. The market clears anyway, which tells you buyers are either pricing it in or missing it entirely. This post is for the ones who would rather not miss it.
The license is a separate asset, and it does not transfer
On October 11, 2022, Town Council adopted Ordinance 22-10, limiting the maximum allowable number of STR licenses that may be issued within Town boundaries to 25% of the residential housing stock. The ordinance went into effect on October 17, 2022. There are 3,600 residential housing units in Frisco and short-term rental licenses are limited to 25% of the residential housing units in Frisco, allowing a maximum of 900 STR licenses.
In February 2023, the Town of Frisco reached its short-term rental license cap and began implementing a waitlist for those wishing to apply for a short term rental license. The cap has not moved since. A new license opens only when an existing holder fails to renew, sells to a buyer who does not requalify in time, or lets the license lapse for another reason.
Here is where the mechanism bites. A Frisco STR license is tied to the owner and the property together. When the property sells, the license disappears. The buyer applies to join the waitlist after closing, not before, because Frisco requires proof of ownership. You close first, then submit your waitlist application. The position is tied to your name and that specific property address and cannot be transferred or pre-reserved.
So the seller's trailing twelve months of rental income is a historical artifact, not a forward covenant. If a listing agent hands over an income statement without adjusting for a licensing gap, they are handing over a fiction. Your underwriting starts with zero rental nights until the waitlist calls your number.
The waitlist math, in months and dollars
The two most recent Frisco-focused broker updates report slightly different waitlist counts and wait times, and both were published within a month of each other. There are currently 83 applicants on the waitlist as of April 2026, with an estimated wait of 12 to 14 months. A separate May 2026 update from a Slifer Smith & Frampton broker puts the waitlist has 57 people on it, and recent buyers have waited 9 to 10 months for a license. The Town's own tracking, referenced by another broker, showed as of 4/23/2026 there are 52 applicants on the Frisco short-term rental waitlist.
Reconcile those and the working assumption is a queue in the 50 to 85 range and a wait of roughly nine to fourteen months. That is a plannable variable, not an unknowable one, and it should be modeled directly into the pro forma.
A rough sketch of what that gap costs on a $1.1 million condo, using the Q1 2026 median sales prices across Q1 2026 ranged from approximately $1,125,000 to $1,700,000 range as a proxy:
| Line item | Assumption | Annualized |
|---|---|---|
| Lost gross STR revenue during wait | 10 months at $80K/yr run-rate | ~$67,000 |
| Carry cost (taxes, HOA, insurance) | ~1.2% of price + HOA | $18,000–$30,000 |
| One-time license fee once issued | $250, non-prorated | $250 |
The STR license application fee is $250 per year. All STR licenses expire April 30. The Town does not prorate the STR license fee. A license granted in November costs the same as one granted in May. That is a small dollar figure, but it argues for timing your waitlist activation right after the April renewal churn, when the highest number of non-renewals typically frees up capacity.
The address on the tax roll is not the jurisdiction
A property mailed to a Frisco ZIP code is not necessarily inside the Town of Frisco. A cluster of parcels sits in the unincorporated Ten Mile Basin, and those follow Summit County's rules instead. Ten Mile Basin (Frisco Terrace, Evergreen, unincorporated Frisco parcels): 20 cap, 24 active. Over cap. Waitlist active.
That distinction matters for two reasons. First, the county's Neighborhood Overlay Zone caps annual bookings, not nights. In the Neighborhood Overlay Zone of unincorporated Summit County, owners are limited to 35 separate bookings per year, not nights. Many owners respond by setting multi-night minimums to maximize revenue per booking. A 7-night minimum and 35 bookings equals up to 245 rental nights. A Ten Mile Basin condo run on weekend turns is worth less than the same condo inside town limits. A Ten Mile Basin condo run on week-plus minimums may actually pencil better, because the town's cap is on the license, not on nightly cadence.
Second, the Summit County property mapping tool is the authoritative check. Confirm the jurisdiction using the county's Property Search and Mapping Tool before you write an offer. A listing description will not flag it, and a title commitment will not spell it out for you.
The 15.725% tax stack, and where it hides
The gross-revenue projection at the top of a broker's marketing sheet is not what lands in the owner's account. The total tax to be collected and remitted for each booking is 15.725%. Inside town limits, the Town of Frisco portion is a 2.0% Frisco Sales Tax, a 2.35% Lodging Tax, and a 5.0% Short-Term Rental Excise Tax, with the balance made up of state, county, and Summit Combined Housing Authority sales taxes remitted separately.
The 5% excise piece is new capital, not inherited baseline. In November 2021, the Town returned to the topic of raising the tax rate on Frisco short-term rentals. In January 2022, the Town Council lowered the initially proposed tax on Frisco short-term rentals from 7.5% to 5%. Residents of the Town approved the 5% excise tax on Frisco short term rentals in their April 2022 election. Any pro forma running off pre-2022 comparables is understating the tax drag by five points.
Platforms are not a shield. Airbnb and VRBO do not automatically collect and remit all Frisco taxes. Verify exactly which taxes each platform handles and remit the rest yourself through the Town's MuniRevs/GovOS portal. Getting this wrong creates tax liability. Owner-side reconciliation is a monthly obligation, not a set-and-forget.
How to structure the offer
Given the license extinction, the waitlist, and the tax stack, three moves separate a disciplined Frisco STR buyer from a hopeful one.
- Underwrite to a licensing gap. Model at minimum ten months of zero STR revenue post-close. If the property still clears your carry with medium-term furnished rentals in the interim, you have a floor. Yes, but only for stays of 30 consecutive days or more. Anything under 30 days requires an active STR license. Long-term rentals are one option. Medium-term furnished rentals of 30 to 90 days are another, and summer demand from retirees escaping the Texas and Southern heat has made this a more interesting market than it used to be. A two-month summer stay at 9,000 feet is an easy sell when it is 105 in Dallas.
- Time the closing to the April 30 renewal window. Licenses expire April 30 and non-renewals cluster in the weeks after. Closing in April or early May puts your waitlist application in front of the largest annual churn.
- Weight walkability over bedroom count. With the license as the scarce asset, revenue per licensed door outperforms door count. Properties within walking distance of Main Street and the Frisco Bay Marina hold rate through both peak ski and summer, and support medium-term demand during the wait.
FAQ
Does an LLC or trust transfer preserve the license? Frisco treats a change of legal owner as a transfer that extinguishes the license. That differs from Breckenridge, where licenses are non-transferable and expire when title of the short-term rental property transfers to a new owner. The Town of Breckenridge allows for some exceptions for title transfers if you change the ownership of your property to an LLC or Trust or for other limited reasons. Verify with the Town before restructuring ownership.
Is there a night cap once the license is issued? No. Once licensed, you can rent as many nights as demand supports. Frisco does not cap annual rental nights, which is better than some neighboring jurisdictions that limit bookings to 35 per year. That is the trade-off for the cap on licenses.
What is the occupancy limit? There is a maximum occupancy of two (2) individuals per bedroom plus four (4) additional occupants. For example – if you have a two-bedroom unit, your maximum occupancy is eight (8). Nightly rate projections modeled on higher guest counts do not survive contact with the ordinance.
Can I preserve the seller's rental calendar between contract and close? No, and the specific language in the seller's forward bookings should be reviewed with counsel. The license terminates at closing, so any booking taken by the seller that overlaps the buyer's ownership requires a fresh license on the buyer's side.
Frisco remains one of the more disciplined short-term rental markets in Summit County. The rules are legible, the town is well managed, and the demand base is deep. What it rewards is buyers who treat the license as a distinct, timed asset rather than a bonus attached to the real estate. If you are evaluating a specific building, unit, or basin, Palazola Group is available to walk through the licensing timeline against the pro forma before you write the offer. Let's Connect.
