JANUARY 20, 2026

We are less than 10 days into the 2026 Legislative Session, and we have already seen several bills introduced that will impact the real estate industry. The Arizona REALTORS® Legislative Committee is hard at work reviewing these bills and deliberating positions to protect our industry and your ability to conduct business.

This week, we will focus on protecting the private property rights of the short-term rental industry. The Arizona REALTORS® understands the nuance that exists within the short-term rental industry. Specifically, there needs to be a balance between the private property rights of the homeowner and the private property rights of the neighboring owners. We have been supportive of legislation in the past that would allow local municipalities to prevent bad actors from using residential homes as commercial event venues or “party houses.” However, the bills below, which are opposed by the Arizona REALTORS® Legislative Committee, would impact the fundamental rights of homeowners in our state.

• SB 1076 Vacation Rentals; Maximum Number; Distance                                                                                      

(Senator Finchem, Legislative District 1) – This bill grants cities and towns with populations under 70,000 the authority to set maximum numbers of vacation rental or short-term rental permits and to establish minimum distance requirements between such rentals. This creates a direct threat to the private property rights of your clients. It also inserts government manipulation into the free market of real estate by altering home prices through limiting the uses tied to said properties.

• SB 1084 Online Home Sharing; Repeal                                                               

(Senator Finchem, Legislative District 1) – This bill would eliminate a key piece of legislation from the previous decade that allows online lodging marketplaces such as AirBnB to collect and remit taxes to the Department of Revenue on short-term rentals. If passed, this would create an unnecessary burden for homeowners who do not have the same resources to properly collect and remit these funds as large online lodging marketplace companies. It would also adjust the property tax classification for short-term rentals, resulting in a higher tax burden than other residential properties.

• SB 1105 Rental; Accessory Dwelling Units; prohibition

(Senator Kavanagh, Legislative District 3) This bill would prohibit the use of an accessory dwelling unit (ADU) as a short-term rental. Currently, state law requires that if an ADU will operate as a short-term rental, the primary residence must be owner-occupied. This speaks to the Arizona REALTORS® stance that short-term rentals are a nuanced topic, and the Association was proud to support this language in a bill focused on increasing ADU production during the 2024 session. The current law prevents concerns that out-of-state investors will purchase R-1 zoned parcels and turn them into miniature hotels with multiple ADUs on the property. Eliminating the ability for a primary resident of a home to build an ADU that they can then turn into a short-term rental as an additional revenue source, while maintaining direct oversight of the guests, is a massive infringement on private property rights that the Arizona REALTORS® will not support.

The Arizona REALTORS® is still eager to work with stakeholders on this issue to find legislation that will eliminate offensive short-term rentals, which unfortunately do exist. However, the above legislation is not the solution as it will only harm homeowners across the state. We need to address the challenges local municipalities face in removing regular offenders under the current “Three Strike Rule” that prohibits irresponsible operators from obtaining a short-term rental permit.

JANUARY 13, 2026

The 2026 Legislative Session is officially underway, convening for the first day on Monday, January 12^th. It was kicked off with the Governor’s State of the State Address to all 90 state legislators in the House of Representatives. Housing affordability and private property rights appear to be of great importance to both the Governor and Legislative leadership as they work to bolster their respective re-election campaigns. The Arizona REALTORS® will remain diligent to ensure our industry is protected.

Each year, we begin our Arizona REALTORS® weekly legislative updates with helpful insight into the legislative process at the state Capitol. This week, we would like to briefly explain the legislative process of how a bill becomes law. It is important background as you follow the journey of our REALTOR® Legislative Agenda this session.

• Step 1: A bill is written by a legislative sponsor in either the House or the Senate. A Senator-authored bill number begins with SB and will begin its lifecycle in the Senate, and a Representative-authored bill number begins with HB and will start in the House.
• Step 2: The leader of the Chamber of origin (Senate President or Speaker of the House) will have the bill assigned for a first reading. If the bill does not have a first reading, it dies.
• Step 3: The bill will then have a second reading, where the Senate President or Speaker of the House assigns the bill to be heard in a committee.
• Step 4: The Chair of the Committee will place the bill on an agenda to be discussed, amended if necessary, and voted on. If the bill is not placed on a committee agenda or the vote fails, the bill dies.
• Step 5: The bill will be discussed by the Caucus of each political party before the entire House or Senate votes on it. If the bill does not receive a majority vote, it dies.
• Step 6: The bill then follows the exact process above in the opposite chamber, so if it started in the House, it will move to the Senate and vice versa.
• Step 7: If the bill received any major amendments in the second chamber, it must then return to the chamber of origin for reconsideration; otherwise, it is transmitted to the Governor.
• Step 8: A bill approved by the legislature will then either be signed by the Governor and accepted into law or vetoed, which kills the bill.

Your advocacy team is already hard at work reviewing legislation impacting the real estate industry. With over 200 bills pre-filed as of last Friday, before the session even began, we expect our Legislative Agenda to be as full as ever. As we progress, more bills will begin to be introduced, assigned to, and voted on by various House and Senate Committees. The 2026 Arizona REALTORS® Legislative Committee will meet for the second time this Thursday with several pre-filed bills to review pertaining to the real estate industry. Continue to check back here weekly for updates throughout the legislative session.

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