CC&Rs Can Be Amended to Prohibit Short-Term Rentals

Question: There is so much information on the Internet about whether the CC&Rs of a community can be amended to prohibit short-term rentals. Just answer “yes” or “no,” please.

Answer: Unfortunately, there is no absolute “yes” or “no,” as it depends on the language in the CC&Rs. The CC&Rs of most communities, however, can be amended to prohibit short-term rentals.

First, in the beginning paragraphs of most CC&Rs, there is precatory language such as, that the goal of the CC&Rs is to have “peace and tranquility” in the community, “open spaces” in the community, and to “preserve property values” in the community. Although the property values of homes owned by short-term rental homeowners can increase dramatically, the property values of the remaining homeowners who live in their own homes can decrease just as dramatically.

Second, the courts historically have allowed CC&Rs to be amended by the homeowners in the community to prohibit leases of less than a year. Therefore, short-term rentals of less than 30 or 60 days can generally be prohibited by an amendment to the CC&Rs.

Finally, condominium communities can only amend their CC&Rs with the consent of all condominium owners. A.R.S. § 33-1227(D).

Note: A recent March 22, 2022 Arizona Supreme Court decision (CV20-0152-PR) invalidated amendments to CC&Rs restricting the development of a 23-acre lot. Some commentators believe that the language in this Supreme Court decision is not favorable to amendments to CC&Rs prohibiting STR’s.