Arizona Short Term Rental Law 2022- SB1168


Governor Doug Ducey recently signed into law AZ SB1168, a new Arizona Short-Term or Vacation Rental Law.  Short tern rentals have become very popular over the past few years in Arizona and Scottsdale specifically.  Scottsdale and all of Arizona is a desirable vacation destination and short term vacation rentals provide a different experience then the tradition hotel or Luxury Resort. With the increased popularity, some push back has come from local residents and local cities.  

The new Law, SB1168, see full text of law here, was passed to address some of these issues that have been brought up in the past year or so.  The law seems to be a fair compromise, even receiving the blessing of industry titan Airbnb.  

The first item the new law addresses is that local cities, CAN NOT prohibit sort-term rentals/vacation rentals in their cities, an obvious win for the short term rental owners.  Many cities were pressing for this possibility as an increase in large scale parties in Scottsdale and Paradise Valley recently has led to numerous complaints and pressure on city officials. 

The main win for the cities is the ability to require licenses or permits for the Short term Rentals.  This will allow them to collect fees (currently maxed at $250 per year) and impose fines, as well as collect information such as name, email, Proof of compliance with transaction tax licensure and emergency contact information.  It also provides for a "three strikes and you are out" the cities can cancel licenses and permits if a short term rental has three violations within a 12 month period.  

The big question is what does this mean to you and your Scottsdale Real Estate.  What the main impact of this bill will be is that over time there will be less short term or vacation rentals in Arizona, not significantly but less.  History teaches us that any time you bring more regulation into the marketplace,  there will be less participants in the marketplace. Some short term rental owners will simply leave the marketplace as they do not want to hassle with licenses and permits.  The short term/vacation rental market will remain strong in Scottsdale and all of Arizona because of all that the area offers to vacationers, there will just be slightly fewer options over time.