Now that the election is over it’s back to our regularly scheduled programming here at the Observer — and, evidently, in the city of Dallas. After all, is there anything more regularly scheduled at this point than the back-and-forth over whether short-term rentals are no longer a thing in Dallas?
Dallas City Council voted to ban short-term rentals throughout most of the city over a year ago, but the ruling has yet to be put into practice because some STR operators sued, and the matter has been under a legal injunction since. An appellate court hearing has been set for Nov. 13 after being delayed earlier this year, and Lisa Sievers, a short-term rental owner and board member of the Dallas Short-Term Rental Alliance, believes the case could set a “very big” precedent for other cities enduring STR debates.
Sievers said the alliance presented six legal points in its lawsuit and each has been deemed by the district judge to have merit.
“That to me means that we have a good case and good legal points, and that's what we are going to be arguing on Wednesday,” Sievers told the Observer. “I think this hearing will have ramifications not only for the state of Texas, but also nationally. It's a big case.”
How We Got Here
In case you missed it, Dallas City Council took a massive swing at short-term rentals in the summer of 2023.The ordinance was a dramatic one, restricting the parts of the city where Airbnb and VRBO properties could operate and introducing a licensing process that would help the city keep track of where STRs were located and whether they were becoming nuisances. The five hours of public comment during the council meeting was a testament to the loud community support both sides of the STR debate had received. Neighborhood activists wearing “Homes not Hotels” T-shirts warned that STRs attracted rowdy party-goers and eroded the sanctity of the single-family neighborhood. Operators argued that the majority of STR owners are good apples who were willing to work with the city and with their neighbors to provide alternative lodging options to Dallas’ tourism infrastructure.
Homeowners who supported the ban told tales of bullets being fired through walls and windows while children slept, as well as numerous instances of unruly, massive gatherings causing parking, traffic, trash and noise problems for full-time residents. They wanted action, and for a time it seemed that their problems had been solved.
The council was in a pickle, and the zoning ordinance that was considered, and which is believed to potentially outlaw an estimated 94% of Dallas’ short term rentals, was sure to end up in court.
Some members of the council were not deterred, though.
“I don’t fear courts,” Council Member Carolyn King Arnold, who voted in favor of the ban, said. “Let’s dress up and go.”
The 12–3 vote for the STR ban may not have been unanimous, but it was overwhelming. Nonetheless, as expected, the city was almost immediately sued over the ordinance. A judge issued an injunction blocking the city from enforcing the ban, and a month later Dallas appealed the ruling.
It’s been twiddling thumbs since — aside from the occasional “What are we doing here?” from city staff.
Okay, So What Are We Doing?
Sievers isn’t arguing that STRs are a completely problem-free operation; instead, she wants to make the case that only a very small minority of rentals cause problems and should be handled on a case-by-case basis.
“Huge amounts of resources are being spent on the taxpayers' back to rein in the very, very minuscule number of properties that are a problem,” Sievers said.
According to city staff, the ongoing litigation surrounding the ban may have left code compliance officers hamstrung. In a September meeting of the Quality of Life, Arts and Culture Committee, city staff told council members that Dallas’ code inspectors have received 160 STR-related complaints in the last year — a number that does not distinguish between calls related to different STRs or to repeat offenders.
But officers can do very little when they receive those calls, city staff said. Part of the approved city ordinance included new measures that code compliance officers can take to address trash accumulation and nuisance behaviors associated with STRs, but with the ordinance in a deadlock, officers don’t have many tools to respond to complaints.
“Nuisance behavior [like partying] occurs typically when code compliance staff are not working in residential neighborhoods,” Chris Christian, director of code compliance services, told the committee.
Even getting operators to comply with existing regulations has proven to be difficult. Dallas currently has regulations in place that require short-term rentals to register with the city and pay a 9% hotel occupancy tax, which helps fund the city’s tourism department, arts initiatives and the convention center. But city officials estimate over 1,500 non-registered short-term rentals are operating in the city. For now, the city is essentially stuck sending the suspected STR properties notices asking the owners to register and pay their taxes.
For Council Member Chad West — who voted against the “heavy handed” STR ban and has been a vocal opponent of over-regulating the rental industry — the hotel occupancy tax is a hot topic (sorry). The taxes bring in millions of dollars to the city each year, but last Thursday, in a Government Performance and Financial Management Committee meeting, city staff told the council that the tax revenue is lagging by 25% for the current fiscal year.
West believes the city council needs to revisit the STR conversation ahead of upcoming major events — like the FIFA World Cup, which North Texas is hosting in 2026 — to capitalize on the potential hotel occupancy taxes that peak tourism times could generate.
“We right now have an ordinance that essentially serves as a prohibition,” West said last week in a meeting of the Government Performance and Financial Management Committee. “Collectively [the city council has] put our heads in the sand, and we scream and yell about how we can’t do better about enforcement, when in reality we need to have an ordinance that we can actually enforce and we need to have an ordinance that brings in revenue for us.”
But other council members were less than thrilled to be digging up what has been buried(ish). Member Cara Mendelsohn told West that the council has debated STR’s “ad nauseam,” and that if the short-term rental ordinance makes its way back onto a meeting agenda she won’t attend and hopes the meeting doesn’t reach a quorum. We reached out to West and Mendlesohn, but neither could be reached for comment.
Sievers, however, is one who does hope to be back at a bargaining table by the end of the week.
If the court rules in favor of STR operators, she hopes to be included in conversations surrounding fairer regulations that don't punish all property owners.
“What I really really am hoping for in this appellate ruling is I hope it brings the city council and people around to the fact that short-term rentals are going to stay,” Sievers said. “We need to work together to make sure that our registration ordinance is in a way that can self-police. Short-term rental owners and operators are all for that. We will have to pay a fee, we will have to do the paperwork, but it’s a small price to pay if we can continue to operate.”
