Scottsdale short-term rental complaints up by 33%, but not for the reasons you think

Scottsdale’s short-term rentals are on track to produce 60% more nuisance party calls to police and 46% more code violations this year than in 2022, according to new city data.

Despite those figures, they may indicate significant progress for the city.

Short-term rentals are typically houses where visitors book stays for less than 30 days using online services, such as Airbnb or Vrbo. The most recent figures from October show there are about 4,100 of them in Scottsdale.

City officials have pushed back against the proliferation of the industry for years. They contend short-term rentals have become a hotbed for loud parties that disrupt quiet neighborhoods and have played a role in making Scottsdale's housing market the least affordable in the Valley.

But local governments were prohibited from restricting the industry until last year, when state lawmakers gave cities “limited” regulatory control, mainly by allowing cities to mandate short-term rental operating permits that can be temporarily suspended if violations occur.

Scottsdale was “flying blind” when it started trying to track and regulate the rentals in July 2022, Councilmember Solange Whitehead said. Staffers weren’t sure how many existed in Scottsdale, let alone where they were or how the city could crack down on violations.

But that’s changed dramatically over the past year. Scottsdale rolled out a robust system for residents to submit complaints about the rentals. It collected a massive amount of information on everything from how many people book Scottsdale short-term rentals each year to how the businesses are distributed within the community.

The effort allowed city staffers to cite nearly 2,500 properties for permit violations in the first few months of 2023, a 90% uptick in code enforcement cases related to short-term rentals when compared to the first three months of 2022.

That number of violations dropped back down below 300 for the next six months of 2023 because many permit dodgers “were captured in the initial proactive enforcement effort,” said Assistant City Manager Brent Stockwell, whose team has gotten more than 80% of Scottsdale’s short-term rentals licensed.

That information is why short-term rental nuisance party calls spiked, from 552 in 2022 to an estimated 883 by the end of this year, according to Scottsdale Police Commander Jeromie O’Meara. He contends the trend began because officers now know where the short-term rentals are and who owns them, not because the properties have gotten more rowdy.

City call-for-service data bears that out. While short-term rental nuisance calls are slated to surge by 60% this year, citywide those calls only increased by 5%, suggesting many of those calls just would not have been flagged as being related to short-term rentals in the past.

"What I again attribute this to is the licensing program ... It has made it significantly easier on the enforcement side to identify the properties that are operating as short-term rentals, and to have that information available to us in terms of who was the owner,” O’Meara said. “That has been a huge asset for the police department to be able to use in our investigations.”

The Arizona Republic broke down five of the findings in Scottsdale’s data that help give shape to the city’s current short-term rental environment.

Scottsdale’s short-term rental industry grew 10% in 2023

It’s tricky to pinpoint the exact number of active short-term rentals that exist in the city. Some may go on the rental market one day and be pulled off the next, which is why Stockwell called it a “moving target.”

Scottsdale partnered with a company called Rentalscape, a group that tracks active short-term rentals for local governments across the country, to get monthly totals that are as accurate as possible. The most recent data ends October 2023.

That data shows the number of short-term rentals in Scottsdale was “rising steadily” this year until it hit its peak of about 4,400 in March. It’s been on the decline each month since then and now sits at around 4,100, which is roughly 340 more properties than were active last October.

But it’s not yet clear what trend will have staying power because of how often the total fluctuates, Stockwell said.

“We don’t have a crystal ball to tell whether this trend will continue, whether (short-term rentals) have peaked and are in a decline or whether this is an anomaly and the (number of rentals) will rise again,” he explained.

More than a million short-term renters book in Scottsdale annually

The trend in how many visitors are booking Scottsdale’s short-term rentals is similarly up-and-down this year, but the sheer number of people staying at the properties is staggering.

Overall, bookings skyrocketed to about a quarter million by October of 2023, which is “a rise of nearly 44,000 stays, or 18% from 2022, without even including the last two months of this calendar year,” according to Stockwell.

But stays in September and October were slightly lower this year than they were for the same months in 2022, so the surge could be dying down.

Stockwell also estimates that the roughly 250,000 stays by October 2023 mean that Scottsdale has been host to as many as 1.5 million short-term rental bookers, given that the average number of guests per booking is six.

Vast majority of short-term rentals in southern Scottsdale

About 70% of short-term rentals in Scottsdale are “disproportionately concentrated” in 16 southernmost square miles of the city, near the Old Town area south of Indian Bend.

The area between Indian Bend and Bell Road is home to another 20% of the rental properties, while the neighborhoods north of Bell Road have only a tenth of the city’s total short-term rentals.

Stockwell said that means “less than half of the population is disproportionately affected by short-term rentals” because of how the city's residents are distributed north and south of Shea Boulevard.

More than 90% of Scottsdale short-term rental owners only rent out one property in the city

Despite the view that short-term rentals are being bought up and rented out by major companies, about 2,600 licensed short-term rental owners live in Scottsdale. That’s roughly 92% of the total permitted owners.

Only 220 of those owners have multiple short-term rentals.

And nearly all of Scottsdale’s vacation rental properties are for full homes that range from two to four bedrooms, rather than the single rooms that are also options on booking apps like Airbnb.

Stockwell contends that fact contradicts the arguments of state lawmakers who adopted a law prohibiting cities from banning short-term rentals in 2016.

“The need for state preemption was made based on the argument that individual homeowners needed extra income to be able to rent out a room in their house. This is not what we’re seeing in advertisements for Scottsdale,” he said. “Almost all short-term rental advertisements in Scottsdale are the main structure and are full-unit rentals.”

Scottsdale police issue more warnings than citations, but that could change

The Scottsdale Police Department’s role in short-term rental enforcement centers around incidents like rowdy parties being hosted at rental properties or dangerous behaviors on site, rather than more technical things like permitting.

For the past two years, it’s issued between 50 and 70 warnings to short-term rental guests and owners, according to Commander O’Meara, who contends that the warnings are “effective” because police rarely get recalled to those properties on the same night.

Meanwhile, police issued just 24 actual citations for short-term rental nuisance parties in 2022, and this year they’re on track to hit 35.

But O’Meara said that is expected to change in 2024 as the full short-term rental squad “gets up and going.” The unit is made up of a sergeant, a police aid, and four officer positions. Some will finish training, while two of the formerly unfilled officer positions are being filled.

“We do need to see an increased (enforcement) effort from our officers. Citations do matter. We recognize that within the community that it is a good deterrent to use and it’s an important tool for us to use … with some addresses with repeated calls for service,” O’Meara said.

Reporter Sam Kmack covers Tempe, Scottsdale and Chandler. Follow him on Twitter @KmackSam or reach him at sam.kmack@arizonarepublic.com.

This article originally appeared on Arizona Republic: Scottsdale claims progress in regulating short-term rentals