In northern Arizona, the debate over short-term rentals has reached a critical juncture. Local mayors are advocating for the return of regulatory powers to tackle the challenges posed by a 2016 law that prevents municipalities from managing these rentals. This legislation, enacted under Gov. Doug Ducey, has sparked a series of unintended consequences affecting local communities.
Local Concerns Over Short-Term Rentals
At a recent forum, northern Arizona mayors highlighted the law’s impact, attributing rising housing costs, workforce shortages, and educational challenges to the surge in short-term rental properties. These issues have been particularly pronounced in tourist-heavy areas.
“Our residents have property rights just like the owners of those mini-hotels, and yet the state legislators turned a blind eye to the very folks that came to Arizona and invested in a home,” expressed Sedona Mayor Scott Jablow.
Historical Context and Current Challenges
Lake Havasu City Mayor Cal Sheehy pointed out that his city has a long history with vacation rentals, dating back to the 1970s. He believes restoring local control could alleviate many of the current problems.
“Lake Havasu City has had short-term rentals since the 1970s, so it has always been a part of our market mix and we have had the ability to control it at the local level,” Sheehy stated. “When we had that control, we were able to carefully balance the impacts of short-term rentals, and having neighbors in neighborhoods, and allowing our neighbors to be able to sleep at night.”
Impact on Community and Economy
The rapid growth of short-term rentals has affected more than just housing availability. Sedona’s Mayor Jablow noted that the healthcare sector, represented by Northern Arizona Healthcare, faces recruitment challenges due to housing shortages.
“Over the last few years, Northern Arizona Healthcare has been impacted by a shortage of housing,” he reported. “Unfortunately, the NHA has lost a wide variety of candidates due to the relatively high cost and even unavailability of housing.”
Educational institutions are also feeling the pinch. As Mayor Jablow explained, “The state pays school districts about $5,000 per year per student. When they lose those students, they lose that funding and there’s no way to make it up.”
Economic Benefits and Drawbacks
Prescott Mayor Phil Goode acknowledged the economic contributions from short-term rentals, which have generated $25 million in economic activity. However, he also pointed out the strain on city resources due to increased complaints related to noise and trash.
“I think it’s valuable to have some of that income generation … but at a certain point they start to become problematic,” Goode commented.
Community Dynamics and Opposition
Mayor Jablow shared concerns about neighborhoods losing their sense of community due to the prevalence of short-term rentals, which he likened to “mini-hotels.” He cited instances of neighborhoods with multiple adjacent short-term rentals, leading to frustration among permanent residents.
Despite the mayors’ concerns, legislative efforts to limit short-term rental growth have stalled. Meanwhile, opinions differ on the economic role of these rentals.
Christy Walker, a Phoenix area real estate broker and short-term rental owner, voiced skepticism about the link between rentals and city financial woes. “The more you limit the economy and the availability of them (short-term rentals), the higher the rates go for people visiting, and so that creates a whole different set of problems,” she argued.
Walker also highlighted the personal benefits of short-term rentals, noting that they help owners offset expenses and plan for retirement. Her own transition from a long-term to a short-term rental resolved neighborhood issues and became a “lifeline for the community.”
“We have neighbors now that thank us for changing it. … They appreciate the fact that it’s just a simple house where families come to enjoy a few days to relax and enjoy a vacation,” Walker said.
—
Read More Arizona News
