Can A City Ban STR's?
October 08, 2018 09:56 Filed in: str's
I have been working on short-term rental issues for 9 years, first in the context of deed restrictions, and more recently in the context of city ordinances. Until I saw some recent city ordinances which outright BAN STR's, I had sort of assumed that a City could, if it writes an ordinance carefully, ban STR's.
I've changed my tune. I've wracked my brain trying to see how a city — particularly a Texas city — can pick out one type of interest of land -- residential lease — and prevent an owner from allowing other human beings to stay at that land under just that one kind of possessory interest. Where I land is that it seems unlikely to me that any city will be able to prove that DURATION OF LEASE provides a rational basis for BARRING RESIDENCY. Furthermore, I think that the Legislature has already preempted cities from outright BARRING STR's — after all, Texas raises revenue from them by taxing them expressly. Could a city ban all hotels? Sounds absurd, right? The Legislature already regulates hotels and earns revenue from the Hotel Tax. How, then, can cities ban the very activity which the Legislature wants to allow?
The issues go deeper, actually, impinging upon fundamental liberty interests. People structure real property possessory interests in all sorts of ways, none of which are readily distinguishable from leasing when it comes to minimum duration of stay. The law allows these various ways of structuring possessory rights. Why would a tenant have fewer possessory rights than, say, the co-owner of an LLC?
As this issue heats up, I expect to see — and argue — very direct challenges to the very power of a city to ban STR's. Without action by the Legislature, my current view is that cities cannot do it. They can regulate many other aspects of real property use — nuisance, noise, occupancy (with an asterisk, since, again, the Legislature has already regulated that area) — but I strongly doubt they can bar a class of people from using property in the normal residential manner.
I've changed my tune. I've wracked my brain trying to see how a city — particularly a Texas city — can pick out one type of interest of land -- residential lease — and prevent an owner from allowing other human beings to stay at that land under just that one kind of possessory interest. Where I land is that it seems unlikely to me that any city will be able to prove that DURATION OF LEASE provides a rational basis for BARRING RESIDENCY. Furthermore, I think that the Legislature has already preempted cities from outright BARRING STR's — after all, Texas raises revenue from them by taxing them expressly. Could a city ban all hotels? Sounds absurd, right? The Legislature already regulates hotels and earns revenue from the Hotel Tax. How, then, can cities ban the very activity which the Legislature wants to allow?
The issues go deeper, actually, impinging upon fundamental liberty interests. People structure real property possessory interests in all sorts of ways, none of which are readily distinguishable from leasing when it comes to minimum duration of stay. The law allows these various ways of structuring possessory rights. Why would a tenant have fewer possessory rights than, say, the co-owner of an LLC?
As this issue heats up, I expect to see — and argue — very direct challenges to the very power of a city to ban STR's. Without action by the Legislature, my current view is that cities cannot do it. They can regulate many other aspects of real property use — nuisance, noise, occupancy (with an asterisk, since, again, the Legislature has already regulated that area) — but I strongly doubt they can bar a class of people from using property in the normal residential manner.