Short-Term Rentals - When Enough is Enough
I often use AirBnB and VRBO rentals when I travel. They are convenient and can be a good alternative if several family members are going with me.
However, as a Planning and Zoning Commissioner in Flagstaff, I see the difficulties that short-term rentals present for people who live and work in Flagstaff. The majority of the short-term rentals in Flagstaff are single family homes or apartments that could be put back into our housing stock. I draw a difference with the rentals people have attached to their homes for extra income. These seem like a reasonable use within a neighborhood.
In 2016, the Arizona legislature passed a law (9-500.39) that says in the first line “A city or town may not prohibit vacation rentals or short-term rentals.” Over time, there have been many attempts to modify this law and put restrictions on the rental property owners but overall, these attempts only made it more difficult to run a short-term rental business but not limit it.
There are almost 1,000 approved short-term rental properties in the city. Some of these rentals are in places where there are Home Owner Associations “HOA’s” which you would think would prohibit short-term rentals. However, when the property was built, the developer specifically put into the “Covenants, Conditions and Restrictions” known as “CC&Rs” that short-term rentals less than 30 days were allowed or they did not specify, leaving nebulous language that is difficult to enforce or change. Now, even if the HOA works to overturn those conditions, they may be sued by homeowners who bought the properties expecting to make money through short-term rentals. Some neighborhoods fighting these issues and attempting to change their CC&R’s include Pine Crest and Pinnacle Pines. I am proud to say that since I have been on the Planning Commission and highlighting this issue, the developers are no longer adding this convenant to the deed.
There are some loopholes that people have tried to use. In some older neighborhoods without HOA’s, there may be wording such as this included in the deed. “No building or lot shall ever be used or occupied for any purpose except that of private residence exclusively and shall not be used or occupied for trade or business of any kind”.
Even if you do a search and find wording such as this in the deed of a short-term rental property, it would be up to you to sue the property owner.
In Tarr v. Timberwood Park Owners Association, the Texas Supreme Court held that restrictive covenants limiting property use to "residential purposes" did not prohibit short-term rentals, provided the renters used the property for a residential purpose and not for a business. This means that if the owner is also living on the property, they could rent out a portion of their home. However, if the whole thing is being used as an AirBnB, then there might be a way to sue them and say they are a business.
Recently, the State Representative from the Prescott and Sedona area, Republican Selena Bliss authored HB 2308 amending the existing code to limit the number of rentals in a city and where they can be located in relation to each other. This bill and many others in the 2025 sessions, related to giving cities control again over short-term rentals, never made it out of committee.
So what can we do about this problem right now?
Encourage developers currently building new subdivisions to restrict short-term rentals of less than 30 days and define the length of rental terms allowed in their CC&R’s. Some HOA’s allow rentals of 3 or 6 months to provide shorter terms for seasonal renters, but do not allow the hotel-like environment of the defined short-term rental which is less than 30 days.
Call our local legislators and encourage them to support legislation giving back control to cities over short-term rentals. Local legislators include Representatives Mae Peshlaki and Myron Tsosie for Legislative District 6 (LD 6), and Representatives David Cook and David Marshall, Sr. for Legislative District 7 (LD 7).
Report any issues to the City of Flagstaff. These issues include parking, noise and notification of surrounding homes that a short-term rental is in operation.
