The Reason Why Short-Term Rentals May Destroy Arizona’s Housing Market

I love spending time in Bisbee. I had tea with a good friend who lives in the little hamlet and told her that I often dreamed of moving to the sweet little village.

"It's changed a lot in the last five years," she told me. "The charm and sense of community are really changing. There are out-of-town investors snapping up the historic homes and buildings and turning them into short-term rentals."

I was crestfallen as I felt my dreams being dashed.

What is a "Wind Phone"? Healing Loss in Arizona

Arizona's Housing Market is Changing. Here's Why.

Bisbee is just one of many Arizona towns and cities being reshaped by a growing trend: short-term rentals over permanent residents.

The housing market is feeling the squeeze, and short-term rentals, especially Airbnb and Vrbo properties, are at the center of the debate. A quick search shows that there are over 50,000 active Airbnb and Vrbo listings in our state. With that many transient renters, the definition of "local resident" is changing.

Many true locals argue that vacation rentals are driving up housing costs and lowering the number of housing units available to long-term residents.

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Short Term Rentals: These Arizona Cities Are the Hardest Hit

Tourist-heavy areas like Scottsdale, Sedona, and central Phoenix have it worse than most places in Arizona. The supply of affordable housing units is falling rapidly as outside investors snap up properties and convert them into short-term rentals.

The trend is making Arizona’s already severe housing shortage even worse. Lawmakers are beginning to get involved, and some have even proposed bills to regulate short-term rentals. They're being met with resistance, with fears they'll be banned outright, which is a measure some locals are pushing for.

How Much Revenue do Short-Term Rentals Bring to Arizona?

Despite this, an outright ban on short-term rentals through Airbnb or VRBO might not be the best idea for Arizona.

Check Out this Sexy Arizona Airbnb Castle Rental in Flagstaff

The companies argue that short-term rentals generate $6.6 billion in economic impact and support 75,000 jobs statewide. Tourism is a major driver of Arizona’s economy. Those dollars are spread among those who rent the spaces, tourist attractions, food, entertainment, and other outlets that benefit from tourist revenue.

Will we be able to balance economic growth through tourism and housing affordability for Arizonans? The debate continues.