Overview: Are Short-Term Rentals Allowed in Phoenix, AZ?

Short-term rentals are explicitly allowed in Phoenix, AZ, but they are subject to a comprehensive permitting and regulatory framework. In September 2023, the Phoenix City Council approved a text amendment that transitioned the existing STR registration requirement to a more formal permitting system, which went into effect on November 6, 2023. This change was authorized by Arizona Senate Bill 1168, passed in 2022, which gave cities the authority to create limited permit processes for STR regulation.

Phoenix allows both owner-occupied and non-owner-occupied short-term rentals, with no cap on the number of permits an individual can hold. The city has explicitly prohibited the use of Accessory Dwelling Units (ADUs) as STRs, and non-residential uses are banned under state law.

How to Start a Short-Term Rental Business in Phoenix

Step-by-Step Process

1. Obtain Arizona Transaction Privilege Tax (TPT) License

   • Apply through the Arizona Department of Revenue online portal
   • Required before applying for local permits
   • License number must be included in Phoenix permit application

2. Register Property with Maricopa County Assessor

   • Update rental status at the county assessor's office
   • Required for all residential rental properties in Arizona

3. Submit Phoenix STR Permit Application

   • Applications are submitted through the SHAPE PHX customer portal
   • City must issue or deny permit within 7 days
   • Permits cost $250 each (initial and renewal)

4. Complete Required Documentation

   • Submit all required forms and attestations
   • Provide proof of liability insurance ($500,000 minimum)
   • Complete neighbor notification process

5. Display Requirements

   • Post permit number on all advertisements
   • Display permit copy within 10 feet of primary entrance
   • Post emergency contact information visibly inside the property

Required Documents, Permits, Licenses, and Guidelines

Permits and Licenses

Phoenix Short-Term Rental Permit

• Cost: $250 (initial and renewal)
• Validity: 1 year (renewable)
• Application: Through SHAPE PHX portal
• Processing Time: 7 days maximum

Arizona TPT License

• Issued by: Arizona Department of Revenue
• Application: Online through AZTaxes system
• Requirement: Must be obtained before city permit application

Required Documentation

Review 1 Documents:

• Affidavit & Attestation - Acknowledgment and Agreement
• Description/Map of Safety Equipment
• Owner's Designee Authorization (if applicable)

Review 2 Documents:

• Attestation of Compliance - Notice to Adjacent Neighbors

Insurance Requirements

• Minimum Liability Coverage: $500,000
• Alternative: Proof that listing platform provides equal or greater coverage
• Documentation: Evidence of coverage must be submitted with application

Safety Equipment Requirements

• Working smoke detectors
• Carbon monoxide detectors
• Fire extinguisher (in kitchen and areas with open flame sources)
• Clearly posted emergency exit information
• Written description or map showing equipment locations

Specific Regulations for Short-Term Rentals

City of Phoenix Regulations

Prohibited Uses:

• Accessory Dwelling Units (ADUs) cannot be used as STRs
• Non-residential uses (retail, restaurant, banquet space, event centers)
• Any use prohibited by state law

Operational Requirements:

• Maintain current, unrevoked, and unsuspended permit
• Display permit number on all advertisements
• Post permit copy within 10 feet of primary entrance
• Provide 24/7 emergency contact information
• Comply with all building and safety codes
• Respond to complaints and violations promptly

Neighborhood Notification:

• Send Notice of Intent via Certified Mail to:
  • Abutting neighbors (adjacent properties, front/back/across street)
  • All residential units on same floor in multi-family buildings
  • Registered HOAs and neighborhood associations within 600-foot radius
• Use City's neighborhood organization search tool to identify relevant associations

Posting Requirements:

• Display owner/owner's designee/emergency contact information within 10 feet of primary entrance
• Include name, phone number, and email address

Maricopa County Requirements

Property Registration:

• All residential rental units must be registered with the County Assessor
• Registration required under ARS 33-1902
• Property management/ownership should provide proof to tenants/applicants

State of Arizona Regulations

Definition (ARS 9-500.39):

• STRs include individually/collectively owned single-family homes, 1-4 family houses, dwelling units, condominium/cooperative units
• Must be transient public lodging establishments
• Excludes non-residential uses including retail, restaurant, banquet space, event centers

State-Level Tax Requirements:

• Transaction Privilege Tax (TPT) - 5.6% state rate
• Combined Phoenix rate: 8.6%
• Annual license renewal required

Penalty Structure

Civil Penalties for Violations:

• First violation: Minimum $500 or one night's rental fee
• Second violation: Minimum $1,000 or two night's rental fee
• Third violation: Minimum $3,500 or three night's rental fee

Permit Suspension:

• STR may be suspended for 12 months if:
  • Three court-adjudicated violations within 12-month period
  • One conviction of felonies or serious crimes within one year

Additional Penalties:

• Operating without a permit is prohibited
• Knowingly occupying an unpermitted STR is prohibited

Contact Information

Phoenix STR Program Administration

Short-Term Rental Program

• Email: vacation.rental@phoenix.gov
• Phone: 602-534-9723
• Department: Planning & Development Department

SHAPE PHX Technical Support

• Email: shapephx@phoenix.gov
• Portal: shapephx.phoenix.gov

Code Enforcement

• Department: Neighborhood Services Department
• Email: blight@phoenix.gov
• Complaint Portal: Report an Issue through Phoenix At Your Service
• Process: Code compliance through ordinance violation notices

State and County Contacts

Arizona Department of Revenue

• Website: azdor.gov
• TPT Information: Business Transaction Privilege Tax section
• Online Portal: AZTaxes system

Maricopa County Assessor

• Website: mcassessor.maricopa.gov
• Rental Registration: Property tax assessment section

General Phoenix Contact Information

Phoenix City Hall

• Address: 200 W. Washington Street, Phoenix, AZ 85003
• Main Phone: 602-262-3111
• TTY: 711

Planning & Development Department

• Phone: 602-262-7811
• Website: phoenix.gov/pdd

Important Source Links

Official Phoenix Resources

• Short-Term Rental Registry Page
• SHAPE PHX Portal
• Phoenix City Code Section 10-195
• Short-Term Rental Ordinance G-6653

State Resources

• Arizona Senate Bill 1168
• Arizona TPT Information
• Arizona STR Definition (ARS 9-500.39)

Forms and Applications

• Affidavit & Attestation
• Safety Equipment Description/Map
• Owner's Designee Authorization
• Neighbor Notification Attestation

Neighborhood and County Resources

• Neighborhood Organizations Search
• Maricopa County Rental Registration

Additional Resources

• AZTaxes Online Portal
• Phoenix Building Codes
• Airbnb Phoenix Host Information (Third-party reference)

This guide provides a comprehensive framework for operating short-term rentals in Phoenix. Investors should regularly check official city sources for updates, as regulations may evolve. The permitting process is designed to be straightforward, but compliance with ongoing operational requirements is critical to maintaining permit status and avoiding penalties.