Airbnb bans parties in all short-term rental properties permanently

Gov. Ducey signed Senate Bill 1168, which offers guidelines to communities to address particular properties that are becoming a nuisance.
Published: Jul. 7, 2022 at 12:49 PM MST
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PHOENIX (3TV/CBS 5) - Short-term rental company Airbnb has announced it’s banning all parties in its properties as Arizona Governor Doug Ducey signs new statewide short-term rental legislation.

On Wednesday, Gov. Ducey’s signed Senate Bill 1168, which protects thousands of Arizona homeowners who share their homes on the site and offers guidelines to communities to address particular properties that are becoming a nuisance. In response to Arizona’s new rental legislation, Airbnb issued the following statement:

“On behalf of the thousands of hosts across Arizona who rely on extra income from renting their homes, we applaud Senator Mesnard and Representative Kaiser for their leadership and determination to work with all stakeholders on this bill. SB 1168 is proof that elected officials and community stakeholders can come together to develop fair, sensible short-term rental rules that address community concerns and preserve the economic benefits of short-term rentals...We believe there is a direct correlation between our implementation of the policy in August 2020 and a 44% year-over-year global drop in the rate of party reports. We’ve seen even more success in Arizona, where there’s been a 55% year-over-year drop in party reports.”

John Choi, Public Policy Director for Airbnb

In August 2020, Airbnb implemented a temporary ban on all parties and events in the company’s listings globally, which during that time was in effect “until further notice.” The company recently decided the ban proved effective and decided to make the ban a permanent policy.

Paradise Valley Mayor Jerry Bien-Willner said the new law is a step in the right direction. “Having consequences, it makes sense to bad actors,” said Bien Willner. “It gets people to pay attention and behave, and so in the law there are provisions that after three incidents a license can be suspended up to a year, and even one bad incident, a license can be suspended.”

Susan Edwards, with the homeowner advocacy group Neighbors not Nightmares, doesn’t think the new law goes far enough. She thinks cities need more funding to help police respond to disturbances at short-term rentals because if citations aren’t issued, then the short-term rental owner can’t be fined. “When are police the busiest? On Friday and Saturday night,” said Edwards. “When are the parties most common? Friday and Saturday nights. If they have a shooting or car accident they’ve got to go there first. It creates a lot of stress.”

The company said that since August 2020, it has seen a 55% drop in party reports coming from Arizona.

Other provisions in SB 1168 include:

  • Local Licensing- authorizes local cities and towns to adopt and enact local short-term rental permitting schemes.
  • Three Strikes penalty- authorizes escalating fines for serious, repeat offenses– such as parties and excessive noise– that impact public health and safety, as well as the ability to suspend or revoke a locally issued license for three adjudicated health and safety violations at the same listing within 12 months.
  • New fines- allows cities to impose financial penalties on hosts who don’t register or provide contact information with local jurisdictions as required by law.
  • Occupancy restrictions- occupancy limits must be put in place for listings of up to 2 adults per bedroom.
  • Insurance Requirement- hosts must provide insurance to guests or have the platform provide it.

Bill sponsor Senator J.D. Mesnard said he is celebrating the year-long effort that went into the bill’s creation. “This meaningful compromise will help put a pause to misguided efforts to overregulate or outright ban short-term rentals in communities, which would threaten the state’s visitor economy and undermine Arizona’s record of supporting property rights,” said Sen. Mesnard.

The bill was supported by various organizations, including the League of Arizona Cities and Towns. For months, state legislators, short-term rental platforms, and the League of Arizona Cities and Towns collaborated to identify solutions to preserve Arizonan’s quality of life while still allowing the short-term rental and tourism industry to thrive. Many Arizona residents’ minds may question whether or not Airbnb’s permanent party ban will impact the Valley’s housing market. Chief marketing officer Anthony Conti at Driggs Title Agency said he doesn’t really think so, although he believes the ban is necessary.

“There’s 3 to 500 people per social party,” Conti said. “And that can destroy a home pretty quick.” He said that if you’re a homeowner with a mortgage looking to turn your house into an Airbnb, check the guidelines and mortgage agreement. You must live in your home for at least a year before listing it on the site.

“HOAs, homeowner insurance--all of these have agreements now that you have to let them know if you’re going to do an Airbnb,” Conti said. “Do your homework, make sure and check with your local area to make sure you can have an Airbnb, check with your mortgage and your HOAs before renting it out.” Between 2017 and 2020, hosts on Airbnb generated an estimated $87 million in taxes for the state of Arizona.