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Why Arizona's short-term rental law doesn't grant blanket approval

Short-term rentals have picked up steam in the last few years thanks to the convenience of third-party websites like Airbnb, Homeaway and VRBO (Vacation Rentals By Owner). These websites allow homeowners to make their property available to rent as a vacation home for a short period of time, typically less than 30 days.

These services, which match vacationers with rental homes, can be tempting to homeowners looking to profit from investment properties or underused second homes, but there are some drawbacks. Before you list your property on a short-term rental site, make sure you are up to date on state and local law.

Arizona's short-terms rental laws began on a local level

Short-term rental services offer benefits to property owners and renters alike. They allow homeowners to make better use of their property while netting an average of $4,000 annually, and they give travelers an alternative to hotel chains and a way to submerge themselves in local culture.

However, many interest groups oppose the practice. Some believe short-term rentals pose a public safety hazard, while others fear that investors will snatch up property to use as short-term rentals, creating a housing shortage. The hotel and lodging industry opposes services like Airbnb as well, because they cut into profits.

As a result, some Arizona cities like Sedona and Prescott banned the practice of short-term renting. Scottsdale made it unlawful to rent out property for a period of less than 30 days.

Arizona's state lawmakers recently took control of short-term rentals

Arizona recently passed a state law overturning existing bans against short-term rentals and preventing cities and counties from creating new laws banning the practice. The state law, Senate Bill 1350, also enables the rental companies listing the properties to collect lodging tax.

Governor Doug Ducey signed the bill into law in May of 2016 as part of a plan to promote the sharing economy and keep tourism dollars local. Some cities have worked around the law through the use of zoning ordinances. In Scottsdale, short-term rentals and bed and breakfasts are prohibited in Single Family Residential districts (as of August 2016.)

Considering short-term rentals? Get good legal advice.

If you are considering renting out your property on a short-term basis in the Scottsdale area, consider seeking legal advice. An experienced attorney can help you understand state and local ordinances and zoning laws, navigate the complexities of tax implications, and avoid the pitfalls associated with short-term rentals. In these types of transactions, it is important to have a seasoned professional protecting your interests.

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