What's the last on STR restrictions in Phoenix/Scottsdale?

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What's the last on STR restrictions in Phoenix/Scottsdale?

Jie Yu
Investor · San Mateo, CA · Member since 2020 · 3 posts · 4 votes

Hi folks, I'm considering getting a STR property in Phoenix/Scottsdale. Where can I learn about the latest on STR restrictions?

I heard some areas are going to restrict rentals (30 or 60 day minimum), like 85254 and 85260. I asked two friends who own STR properties there, but they are not aware of this.

The potential policy changes have been my primary concern on getting a STR here. Would appreciate any insights on this. Thanks.

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Brandon Dukeman
Realtor · Phoenix, AZ · Member since 2018 · 8 posts · 3 votes
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Hi Jie, 

Some areas in Phoenix/Scottsdale and surrounding areas are starting to implement the 30 day minimum rental restriction in hopes to reduce the amount of STR's vs a more primary residence. However, there is definitely a demand for the STR in these locations and there are many communities that do not have any restrictions on these rental minimum.

Definitely inquiring about the community CC&R's and regulations regarding the STR ability is recommended. I am seeing a lot of these restrictions in condo/townhome communities.

-Brandon

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  • Brandon Dukeman
    Realtor · Phoenix, AZ · Member since 2018 · 8 posts · 3 votes
    4y

    Hi Jie, 

    Some areas in Phoenix/Scottsdale and surrounding areas are starting to implement the 30 day minimum rental restriction in hopes to reduce the amount of STR's vs a more primary residence. However, there is definitely a demand for the STR in these locations and there are many communities that do not have any restrictions on these rental minimum.

    Definitely inquiring about the community CC&R's and regulations regarding the STR ability is recommended. I am seeing a lot of these restrictions in condo/townhome communities.

    -Brandon

    1Reply
  • Jie Yu
    OP
    Investor · San Mateo, CA · Member since 2020 · 3 posts · 4 votes
    4y
    Quote from @Brandon Dukeman:

    Hi Jie, 

    Some areas in Phoenix/Scottsdale and surrounding areas are starting to implement the 30 day minimum rental restriction in hopes to reduce the amount of STR's vs a more primary residence. However, there is definitely a demand for the STR in these locations and there are many communities that do not have any restrictions on these rental minimum.

    Definitely inquiring about the community CC&R's and regulations regarding the STR ability is recommended. I am seeing a lot of these restrictions in condo/townhome communities.

    -Brandon

     Thanks @Brandon Dukeman for the reply! 

    For single family homes with no HOA, will there be additional community CC&R's and regulations?

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  • Brandon Dukeman
    Realtor · Phoenix, AZ · Member since 2018 · 8 posts · 3 votes
    4y

    Typically if there are no HOA's there would not be a restriction on the use of the home. Now, some cities and localities may have restrictions on how the property is used or how many STR's there can be but that is all dependent on the location of the property.

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  • Adam Douglas
    Real Estate Agent · Scottsdale, AZ · Member since 2022 · 1 post · 0 votes
    4y
    Quote from @Jie Yu:

    Hi folks, I'm considering getting a STR property in Phoenix/Scottsdale. Where can I learn about the latest on STR restrictions?

    I heard some areas are going to restrict rentals (30 or 60 day minimum), like 85254 and 85260. I asked two friends who own STR properties there, but they are not aware of this.

    The potential policy changes have been my primary concern on getting a STR here. Would appreciate any insights on this. Thanks.


    My investor clients have been buying up homes in South Scottsdale neighborhoods with no HOA. Staying up to date with city codes is Key but most recent changes have just been a kick up in the punishments of smaller issues such as not responding within a certain amount of time to a noise complaint, etc. It does not look like there will be any sort of city wide mandate against STR under 30 days any time soon. Would love to chat more about it.

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  • Deonte Brown
    Real Estate Agent · Member since 2018 · 53 posts · 24 votes
    4y

    Hi @Jie Yu

    Cities or towns can not prohibit or restrict short-term rentals in the State of Arizona per ARS 9-500.39. However, cities and towns can add some layers to hold landlords accountable. Scottsdale has done this by implementing a city ordinance that requires owners to register an emergency contact who can and will respond to the property if and when they receive a call. I work with a few property managers who can be that person if the owner is out of state or does not want to.

    I would recommend you find a home in a community without an HOA if you want to have a short-term rental. HOAs are free to sanction Short Term Rentals, and as Brandon stated above. There are a number of HOAs are requiring a minimum 30-day stay.

    Sources
    Arizona Revised Statue: https://www.azleg.gov/ars/9/00...

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  • Chad McMahan
    Residential Real Estate Broker · Sedona, AZ · Member since 2017 · 754 posts · 504 votes
    4y
    Quote from @Jie Yu:

    Hi folks, I'm considering getting a STR property in Phoenix/Scottsdale. Where can I learn about the latest on STR restrictions?

    I heard some areas are going to restrict rentals (30 or 60 day minimum), like 85254 and 85260. I asked two friends who own STR properties there, but they are not aware of this.

    The potential policy changes have been my primary concern on getting a STR here. Would appreciate any insights on this. Thanks.


    Hi Jie.
    There is a LOT of misinformation from real estate professionals and from AZ government. Because of this there are a LOT of misunderstandings and information is coming slowly, to those who either don't know how to find it and/or don't know how to interpret legalese. I'm working hard to stay in "the know". Check out my blog on potential law changes here:
    https://realtorsedona.com/impo...
    RE: HOA comments- For now, if something has 1) no HOA OR 2) rental RESTRICTING CC&R'S (Which CAN be present with no HOA), the rentable time frame can NOT be legally restricted throughout AZ. No exceptions. Most realtors get the 2nd part of this wrong and really screw over their clients. In some cases RE the CC&R's, the risk is quite minimal and worth the risk. In some cases, buyers purchase and then neighbors shut down their STR.

    The best thing buyers can do if pursuing STR's in AZ or any state, is be EXTREMELY selective and choose an investment specialized realtor + STR/investment savvy mortgage broker/loan originator (Your realtor should point you toward someone great).

    AZ may, or may not be seeing changes over the next 6 months. Nobody knows, as we do not know how the attempts on law changes will go. However, I will say if they are restricted in AZ, it very likely will be more of a matter of stiffer penalties for noise violations, and providing owner or designee contact info for when problems arise. Finally, we may see the percentage of STR's being capped, within each town. Or, some or none of these things will occur- if the laws do not receive final approval. Over the last several years, there have been many attempts to legally restrict STR's, which have been rejected/declined. There is more traction on the attempts this year, as some locals with deeper pockets have hired lobbyists to push their agenda. At this moment, nothing is certain.

    As much as I know, I am absolutely continuing to invest in STR's in my neck of the woods, as the cash flow is excellent, the owner/investor risk is minimal/acceptable and it's a growing market.

    Bottom line, stay informed and always keep investing wherever returns seem strongest.
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