MacQueen & Gottlieb co-founders Ben Gottlieb and Patrick MacQueen. (Photo courtesy of MacQueen & Gottlieb)
Real Estate Pulse: Things to know about short-term rental laws
In Arizona, Airbnb collected and remitted more than $63 million in tourism taxes in 2021, an increase of approximately 120 percent over 2019. Those eye-popping numbers show that short-term rentals are big business in Arizona, but what do do people need to know about short-term rental laws?
In the first episode of “Real Estate Pulse with MacQueen and Gottlieb,” co-founders Patrick MacQueen and Ben Gottlieb talk about the laws governing short-term rentals and how homeowners associations are impacted by short-term rentals.
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“About six years ago, a state law was passed that essentially made it unlawful for a city or a town to enact a code or an ordinance prohibiting short-term rentals,” Gottlieb says. “But if you lived in an HOA, you could bypass that law. Through the covenants, conditions, and restrictions (CC&Rs), the community could band together and amend the CC&Rs and prohibit short-term rentals. So it became this big thing because if you live in an HOA, you can have a situation where there will be no short-term rentals. But if you don’t, then you have this state law that ties the hands of cities and towns.”
But that’s not the only sticking point or gray area when it comes to short-term rental laws.
“We see a lot of people who are coming in for Airbnb arbitrage or short-term rental arbitrage,” MacQueen says. “What this arbitrage concept means is let’s say I rent your house for $5,000 a month and then I’m the tenant. I go and find a bunch of short-term renters to come in and use my time that I’ve rented your home. Now, your home becomes a short-term rental. I’m paying you $5,000, but I’m bringing in $10,000 a month on a short-term rental basis. It’s the no-money-down way to be in the industry. So we’re seeing a lot of investors doing that.”
Check out the first episode of “Real Estate Pulse with MacQueen and Gottlieb” to learn about these hot-button topics and all the things you need to know about short-term rentals and the law.