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

YES — Short-term rentals are explicitly allowed in Tempe, Arizona. The city has an active ordinance in effect that permits short-term rentals, provided operators comply with registration requirements and applicable regulations. Short-term rentals are defined as residential properties rented for periods of less than 30 days, including vacation rentals, single-family homes, apartments, condominiums, rooms for rent, and corporate housing.

How to Start a Short-Term Rental Business in Tempe, AZ

Starting an STR business in Tempe follows a structured, four-step process:

Step 1: Obtain State Transaction Privilege Tax (TPT) License

All hosts must first obtain a state Transaction Privilege Sale Tax (TPT) license through the Arizona Department of Revenue. This can be completed online at AZTaxes.gov. Your TPT license number is mandatory for completing your short-term rental permit application.

Step 2: Notify Neighbors

Before submitting your STR application, you must notify your neighbors according to state requirements. This includes residents on the same apartment floor for multi-family properties. You'll need to attest to completing this step during the application process.

Step 3: Verify Property Registration with Maricopa County

Ensure your property is registered with the Maricopa County Assessor's Office as a rental property. Property management or ownership should provide proof/confirmation of this registration, which you'll need to attest to during the application.

Step 4: Complete City Registration Process

Finally, complete the short-term rental application through the City of Tempe's licensing system. Ensure you include all required documentation, including your TPT license number and neighbor notification confirmation.

Required Documents, Permits, Licenses, and Guidelines

City-Level Requirements

Tempe Short-Term Rental License

• Required for each rental unit
• Application processed through the City's licensing portal
• Must be displayed or made available upon request

Transaction Privilege Tax (TPT) License

• State-level license required for all STR operators
• Obtained through Arizona Department of Revenue at AZTaxes.gov

Neighborhood Notification Proof

• Documentation showing notification to adjacent neighbors
• Required attestation during application process

County-Level Requirements

Maricopa County Assessor Registration

• Required for all rental properties regardless of rental term
• Failure to register results in a $1,000 fine from code enforcement
• Registration must be current and maintained

Tax Obligations

Transaction Privilege Tax Rates for Short-Term Rentals:

• 1.8% to Tempe (Region Code TE, Business Code 44)
• 5.0% to Tempe (Region Code TE, Business Code 144)
• 7.27% to Maricopa County and State (Region Code MAR, Business Code 25)

Important Tax Notes:

• Long-term residential rentals (30+ days) are no longer taxable as of January 1, 2025
• Short-term rentals remain taxable
• Online Lodging Marketplaces collect and pay TPT on your behalf for their bookings
• Direct bookings must be filed and paid by the property owner
• All TPT license holders must file monthly reports even with $0 liability

Specific Regulations for Short-Term Rentals

City of Tempe Regulations

Registration Requirement

• Short-term rentals must register with the City of Tempe
• Registration allows emergency contact and code violation communications
• Properties must display license information as required

Occupancy Limits

• In single-family districts, maximum of three (3) unrelated people can live together
• This limit applies regardless of home size or number of bedrooms

Code Compliance

• Must comply with Tempe's Nuisance and Property Enhancement Code
• Requirements include designated parking only, no trash/debris in yards, pet cleanup
• Must comply with Rental Housing Code

Alarm Ordinance

• New or existing residential alarms must be registered through Tempe's Alarm Program
• Police Department jurisdiction for alarm-related issues

State of Arizona Regulations

Arizona Residential Landlord and Tenant Act

• Governs landlord-tenant relationships
• Applies to STRs when applicable

Transaction Privilege Tax Requirements

• All STR operators must hold valid TPT licenses
• Monthly filing requirements regardless of activity level
• Proper categorization as hotel/motel alternative for tax purposes

County-Level Regulations

Maricopa County Requirements

• All rental properties must register with County Assessor
• Ongoing registration maintenance required
• Code enforcement penalties for non-compliance

Contact Information for Local Authorities

City of Tempe - Primary Contacts

Tax & License Department

• Phone: 480-350-2955
• Fax: 480-350-8659
• Email: salestax@tempe.gov
• Office Address: 20 E. 6th St., 3rd Floor, Tempe, AZ 85281
• Mailing Address: P.O. Box 5002, Tempe, AZ 85280
• Hours: Monday-Friday, 8am-5pm (excluding city holidays)

General City Information

• Phone: 480-350-4311
• Address: City Hall, 31 E. 5th St., Tempe, AZ 85281

Additional City Contacts

• STR Licensing Help: license@tempe.gov
• Police Department (noise complaints, etc.): 480-350-8311
• Alarm Program: 480-350-8778

State and County Contacts

Arizona Department of Revenue (TPT Licensing)

• Website: aztaxes.gov
• For TPT license applications and questions

Maricopa County Assessor's Office

• Website: mcassessor.maricopa.gov
• For rental property registration

Support Resources

Landlord/Tenant Dispute Hotline: 602-256-3517

Source Pages and Additional Resources

Primary Government Sources

• City of Tempe - Short-Term Rental License
• Tempe Commercial Lease/TPT Information
• Renting in Tempe - General Guidelines
• Tempe Nuisance and Property Enhancement Code
• Tempe Rental Housing Code

State Resources

• Arizona Department of Revenue - TPT Information
• AZTaxes.gov - TPT License Application
• Arizona Residential Landlord and Tenant Act

County Resources

• Maricopa County Assessor - Rental Registration
• Maricopa County Assessor - Forms

Industry Resources

• Rent Responsibly - Tempe STR Information
• Airbnb - Tempe Host Guidelines

Disclaimer: This guide is for informational purposes only. Always verify current regulations directly with the City of Tempe and consult with legal and tax professionals for compliance advice specific to your situation.