short-term rentals

Sedona Adjusts to Influx of Short-Term Rental Boom

By Anthony SanFilippo

In 2016, the Arizona legislature passed a bill that was described as an opportunity for property owners to rent out space in their home to make a little extra money.

That bit of legislation, known as the “AirBnB Bill,” was signed into law by Gov. Dave Ducey.

In the three years since, touristy areas like Sedona, have now reached a crossroads.

Property owners should have a right to use their property as they see fit, even if that includes renting part or all of it out. However, without some sort of local regulation, there’s a chance it could impact the community negatively – by reducing the affordability of homes as well as the availability of homes to be purchased.

After the law passed, Sedona saw an influx of new property owners who saw the law as an opportunity to make good money.

“The debate over if this is a good or bad thing rages on – and likely will for some time, especially in cities like Sedona – where vacationers are attracted from far and wide.”

Instead of full-time residents renting out rooms or their homes for short periods of time, Sedona saw and increase in investors buying properties and renting them out year-round.

In some instances, investors are buying up land and building homes specifically to rent them out short-term for tourists.

The debate over if this is a good or bad thing rages on – and likely will for some time, especially in cities like Sedona – where vacationers are attracted from far and wide.

Some will argue that the government shouldn’t impede on an individual’s property rights and that a property owner can use their property however they see fit.

Others will say that an influx of short-term rentals negatively impacts neighborhoods, making them more transient and in turn, less safe when you never know who is coming or going, and that it also has other impacts on safety and quality of life.

There is also an argument that rising home prices may be related on some scale to the influx of short-term rentals.

It’s an argument that is sweeping the nation and has been as more social media sites like AirBnB, VRBO and HomeAway continue to flourish.

There are passionate individuals on both sides of the argument, and both have very valid arguments, which makes the issue so thorny.

Some have suggested that giving cities some local control back in the form of stricter regulations on parking, trash, noise and even limiting party houses is the happy medium, and while those types of ordinances do exist in a lot of places in Arizona, there is still a debate as to their effectiveness.

Recently, Arizona stare Rep. Bob Thorpe, of Flagstaff, held a town hall meeting and was met by more than 150 people who wanted to discuss this issue, either supporting the right to rent your home on a repeated, short-term basis, or those vehemently opposing the notion.

“The Arizona Republic reported last January that approximately 20 percent of Sedona’s total housing stock were vacation rentals.”

Thorpe heard it all, from property owners who said having the luxury of having short-term rentals is allowing them to pay their mortgages, to long-term renters who fear that they won’t be offered new leases on their homes because the short-term rental market is more lucrative for landlords, to teachers who can’t afford to stay at their schools because they don’t make enough money to live close to the schools in which they teach. A whopping 20 percent of teachers who were hired for the 2019-2020 school year resigned from their positions after being unable to find affordable housing in the area, according to data from the Sedona-Oak Creek Unified School District School Board.

At the end of the meeting, Thorpe insisted he was going to propose legislation in January, when the House next convenes, to address issues that have cropped up over the course of the past three years.

“We never anticipated that somebody would go into a neighborhood, purchase a home and turn it into a mini-hotel,” Thorpe said at the meeting, according to USA Today.

The Arizona Republic reported last January that approximately 20 percent of Sedona’s total housing stock were vacation rentals.

Meanwhile, the median cost of a home in Sedona is now $562,000, about $44,000 higher than it was at the same time last year. With the median income for a family of four in Sedona is $56,000, affordability is already a problem, and some argue that an influx of short-term rentals doesn’t help to reduce that gap.

However, there is a group that has managed to limit or outright stop short-term rentals and they are Home Owner Associations (HOA) in Arizona.

The 2016 law only specified cities and municipalities when it came to regulatory controls, as such, HOA’s have relied on their own set of rules (Covenants, Conditions and Restricts) to limit or prevent homeowners from renting short-term.


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