Short-term rentals continue to be a hot button topic in Arizona, and throughout the Country. A recent opinion from the Texas Court of Appeals, Duncan v. Prewett Rentals Series 2 752 Military, LLC, No. 03-21-00244-CV (Tex. App. Aug. 19, 2022), contemplated whether a short-term rental, by operation of its use as a “party house” violated the private residential use restriction in the CC&Rs. There was testimony that approximately 6-10 cars were frequently being parked at the homes overnight, overflowing trash cans, loud parties, fireworks, trespassing, damaging neighboring property, speeding, and driving recklessly, all of which the court suggested may implicate a “party house” rather than private residential occupancy. Do the facts of this case sound familiar to your HOA or condo association?
Pursuant to ARS 33-1260.01(A) / 33-1806.01(A), “[a]member may use the member’s property as a rental property unless prohibited in the declaration and shall use it in accordance with the declaration’s rental time period restrictions.” Accordingly, the Arizona Legislature has determined that a community association (Condominiums and Planned Communities) can restrict short-term rentals, but only to the extent that such rental time period restrictions are expressly provided for in the declaration. However, please keep in mind that even if your community’s declaration does not prohibit short-term renters, community associations retain the right to enforce all other use restrictions (e.g. nuisance restriction) against the owner of a lot/unit being used a short term rental.
Furthermore, please note that pursuant to ARS 33-1260.01(C) / 33-1806.01(C), the Association may request the following information regarding the tenant(s): “name and contact information for any adults occupying the unit, the time period of the lease, including the beginning and ending dates of the tenancy, and a description and the license plate numbers of the tenants’ vehicles.” In 2022, the Arizona Legislature also passed a bill that allows cities and towns the authority to regulate short term rentals in various ways (e.g. requiring emergency contact info; requiring a permit or license; requiring notification of neighboring properties; requiring display or permit/license on advertisements; and, requiring insurance coverage).
If your community is dealing with a “party house” you have options, including, but not necessarily limited to: contacting the police, notifying city code enforcement, engaging a community association attorney to contact the owner and/or pursuing litigation.
Please contact Mulcahy Law Firm, P.C. for answers to these questions and additional information and help with this issue.