Airbnb vacation rentals took over one city in Arizona, frustrating its citizens and causing business leaders to speak out.

Airbnb, a short-term housing rental site, is frequently at battle with cities across the U.S. as local governments seeks to limit the usage of short-term housing companies in their area.

A few recent examples include: Airbnb and Expedia Group’s HomeAway lost their case in the Ninth Circuit Court of Appeals to the city of Santa Monica. This means the previous ruling still stands that the short-term rental companies are liable for illicit rentals on their sites.

New York City Mayor Bill de Blasio recently announced that the city is issuing a subpoena to Airbnb, demanding that the short-term rental site turn over the listing data that’s at the center of a legal battle between the two sides.

And Massachusetts recently passed a law that extended the state’s current 5.7% hotel tax to most short-term rentals, along with giving municipalities the option of tacking an additional 6% onto the tax; 9% if an owner rents out two or more units in the same community.

But now, Sedona, Arizona, is learning what happens when short-term rentals are not limited. One Arizona state law forces cities to allow Airbnb-type rental, and limits the regulations cities can impose.

In Sedona, investors are moving into the neighborhoods to buy up homes for rentals, driving up housing costs. In fact, it is now estimated that about 1,000 homes, or 20% of the city’s total vacation housing inventory, are being used as short-term vacation rentals, according to an article by Lorraine Longhi for azcentral.

Housing costs in that area continue to rise, outpacing the rest of the country, the article stated. City residents continue to fight back against Airbnb, demanding something be done to combat the effects it is having on Sedona residents.

An article from HousingWire Magazine’s February issue shows how short-term rentals, when left unchecked, can have disastrous consequences for local housing markets. Click here to read more about that.

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