Buying a Home in an HOA for Short-Term Rentals: The Pros & Cons

Arizona is a tricky market for short-term rentals (STRs), mainly due to the sheer number of HOAs. In fact, Arizona is considered the birthplace of the homeowner association (HOA), and roughly 80% of homes in the Phoenix metro area fall under some form of HOA regulation. Because of this, the vast majority of HOAs either prohibit short-term rentals entirely or impose strict rental duration limits—typically requiring leases of at least 30 days at a time or some even 12 months!

If you’re considering buying a home within an HOA to use as a short-term rental, here are the pros and cons:

✅ Pros of Buying in an HOA for STR Use:

  • Well-Maintained Neighborhoods – HOAs maintain curb appeal, landscaping, and amenities, which can make your rental more attractive to guests.
  • Potential for Higher Rental Rates – Since HOA communities tend to be more desirable, you might be able to charge higher rates for extended stays (30+ days).
  • Amenities for Guests – Some HOAs offer pools, clubhouses, and parks that can be a selling point for renters looking for extended stays.

❌ Cons of Buying in an HOA for STR Use:

  • Strict Rental Restrictions – Many HOAs flat-out prohibit rentals under 12 months, while some allow 30+ day rentals. If you're set on short-term rentals, finding an HOA that permits it is tough.
  • Risk of Fines or Legal Action – Renting out your property against HOA rules can lead to fines, lawsuits, or forced sale if you don’t comply.
  • Neighborhood Watchfulness – Many HOA communities have active residents who report violations, making it harder to "fly under the radar." Scottsdale, in particular, is very strict on STR enforcement.

🏛️ State Laws & HOA Restrictions

Arizona has statewide laws that prevent cities and towns from outright banning short-term rentals, but they can regulate them through licensing, taxes, and noise ordinances. That’s why places like Scottsdale have more stringent STR rules.

Additionally, recent legislation prevents older HOAs (established before STRs became popular) from suddenly changing their CC&Rs (Covenants, Conditions, and Restrictions) to ban STRs. If an HOA didn’t previously restrict STRs, they may not be able to outlaw them retroactively. But this area remains somewhat gray, and HOAs can still create workarounds to restrict STR activity.

🔍 Your Options When Buying for STRs in Phoenix

Given these challenges, you have three primary options when purchasing a home for short-term rental use:

  1. Buy in an HOA & take the risk – Many owners list homes on Airbnb or VRBO despite HOA restrictions. Some get away with it; others don’t. It’s a high-risk approach.
  2. Find an HOA that allows 30+ day rentals – While this limits your target audience, it’s a safer option for mid-term rentals, appealing to traveling nurses, corporate renters, and snowbirds.
  3. Only buy a Non-HOA home – This is the safest option, but non-HOA homes are rare, especially under $400K. These neighborhoods may also be less desirable for guests.

💡 Bottom Line

If your goal is to operate a true short-term rental with stays under 30 days, your best bet is to buy outside an HOA—but that comes with trade-offs. If you’re okay with longer stays (30+ days), you might find an HOA that allows it, but it still limits your rental potential.

And if you decide to go against HOA rules, know that enforcement varies—some communities are lax, while others actively monitor and fine violators.

Considering buying a home for STR use? Let’s chat about your goals and find the right property for you!