What did the court actually decide?
The dispute concerned a property in a Portsmouth residential district being used as a short-term rental. The city took the position that the use wasn't permitted there, and the owner challenged it.
The New Hampshire Supreme Court sided with the city. The reasoning came down to the ordinance's own definitions. Portsmouth had drafted "dwelling unit" in a way that carved out transient occupancies such as hotels, rooming houses, and similar uses where occupants stay short term. Because the ordinance excluded that category from what counts as residential dwelling use, renting the property to a rotating stream of short-stay guests fell outside what the district permitted.
The important thing for an investor is what the case turned on. The court didn't rule that short-term rentals are inherently non-residential across New Hampshire. It read one city's ordinance and applied what that ordinance said.
Why does that distinction matter so much?
Because a different town with different drafting got the opposite result four years later.
In Town of Conway v. Kudrick, decided May 2, 2023, the New Hampshire Supreme Court considered Conway's ordinance, which defined a residential dwelling unit without any durational requirement. Because Conway's definition didn't exclude short-stay occupancy the way Portsmouth's did, the court held that non-owner-occupied short-term rentals fell within it and were permitted in Conway's residential districts.
Same court, same general question, opposite outcome, driven entirely by how each town wrote its own definitions.
That's the core lesson for anyone buying in New Hampshire. There is no statewide rule to rely on. You cannot reason from a neighboring town, and you cannot reason from a court decision about a different municipality.
Looking at a specific Portsmouth address, or comparing towns? I'll pull the current ordinance language and the definitions that decide it. Two business days, no obligation.
Does anything change if I live in the property?
Possibly, and it's worth checking rather than assuming either way. Working Stiff Partners concerned a non-owner-occupied use, and owner-occupancy is a distinction several New Hampshire towns draw in their ordinances. Renting a room in a home you live in is frequently treated as a different zoning question than operating a whole house you don't occupy.
Whether Portsmouth's current ordinance draws that line, and where, is a question for the city's current text and its planning department rather than for a 2019 case summary.
What should I do before buying in Portsmouth for STR use?
- Read the current ordinance, specifically the definitions section and the permitted uses for the district the property sits in. Ordinances get amended.
- Check which district the address is actually in. Portsmouth's rules vary by district, and the 2019 case concerned one specific residential district.
- Call the planning or code enforcement office and ask whether the use you're planning is permitted there. Ask them to point you to the language.
- Get it in writing where you can.
- Register for the state Meals & Rooms tax regardless. The 8.5% rate applies to rentals under 185 consecutive days statewide, independent of local zoning.
If the answer in Portsmouth is no for what you want to do, that's useful information early. It's a cheaper answer before an offer than after one.
