Which States Stripped Cities of STR Authority in 2026? A Roundup of the Preemption Bills That Passed, Failed, and Are Still Moving.

Arizona’s cities spent another legislative session asking the state legislature for authority to regulate short-term rentals in their own jurisdictions. The Senate responded by letting the reform bill die without a single committee hearing.

That is the headline, but it is far from the only story. The 2026 state legislative season produced a wave of STR preemption activity across more than a dozen states. Two new preemption laws were signed. One major tax-protection bill is still advancing with strong bipartisan support. And every restriction bill that tried to give cities new power over short-term rentals either died in committee or failed to reach a floor vote.

I have reviewed every STR preemption and restriction bill that moved through a committee, a floor vote, or a governor’s desk this session. Here is the state-by-state breakdown of what passed, what failed, and what investors evaluating new markets need to know before the dust settles.

Arizona: The Reform Bill That Died in the Senate

If you own or are considering buying an STR in Scottsdale, Sedona, or Flagstaff, this is the section that matters most.

Arizona’s statewide STR preemption law (ARS 9-500.39, enacted in 2016) is one of the most investor-friendly regulatory frameworks in the country. It bars cities and towns from banning short-term rentals outright and limits the types of regulations they can impose. Cities have been trying to claw back that authority for years. They have not succeeded yet.

HB 2429, sponsored by Rep. Selina Bliss (R-Prescott), was the latest attempt. The bill would have given municipalities a modest set of new tools: maximum overnight occupancy limits (two adults per sleeping area, plus two), the ability to suspend STR licenses after three permit violations within 24 months, and a requirement for sex offender background checks on guests. It was not a ban. It was not even a dramatic rollback. But it would have opened the door to local regulation that Arizona’s preemption law currently keeps firmly shut.

The bill passed the House 37-14 in March. Then it reached the Senate, where committee chairmen in both Regulatory Affairs and Appropriations chose not to schedule a hearing. No hearing. No alternative bill. No floor vote. Rep. Bliss told the Arizona Capitol Times she has already begun planning for next year’s session. (I have reviewed enough of these annual legislative cycles to recognize the pattern: the bill will return, the debate will be loud, and the Senate will once again be the place where reform goes to wait.)

What this means for investors: Arizona’s 2016 preemption remains fully in force. Scottsdale, Sedona, Flagstaff, and every other Arizona municipality cannot ban STRs, cannot impose density caps, and cannot require permits that go beyond what ARS 9-500.39 allows. Cities tried to change that in 2026. They failed. Investors who own properties in these markets remain protected by one of the strongest state preemption frameworks in the country.

Missouri: The Tax-Protection Bill With Momentum

Missouri is the state investors should be watching right now.

SB 1066 addresses a problem that caught many STR owners off guard: county assessors reclassifying short-term rental properties from “residential” to “transient housing,” which triggers commercial property tax rates. In practical terms, that means your assessment rate jumps from roughly 19% to 32% (a roughly 68% increase in your assessed value for tax purposes). Some Missouri STR owners have reported effective property tax increases exceeding 150%.

The bill would lock in residential classification for single-family homes rented short-term, provided the owner holds no more than fifteen such properties. It would also prohibit assessors from reclassifying a property without first conducting an in-person consultation with the owner of record. That last provision is the kind of procedural safeguard that sounds boring until it is the only thing standing between you and a surprise tax bill.

SB 1066 passed the Missouri Senate 30-3 on March 25. HB 1768, a companion bill with identical protections, passed the Missouri House on April 2. Both bills are now working through the opposite chamber. The Missouri legislative session ends May 15.

Picture this: you bought a cabin near Branson or a lakefront property at Lake of the Ozarks, ran your numbers at the residential tax rate, and then your county assessor reclassified the property as commercial. Your tax bill nearly doubled overnight. SB 1066 would prevent that from happening going forward and would require assessors to sit down with you before reclassifying your property. The Missouri Vacation Home Alliance (MOVHA) has been the primary advocacy organization pushing both bills through the legislature.

What this means for investors: Missouri is not a done deal. The bill has not been signed by the governor. But a 30-3 Senate vote and strong bipartisan House support suggest the probability of enactment before the May 15 deadline is high. Investors evaluating Branson, Lake of the Ozarks, or St. Louis area markets should factor in near-term preemption probability when running their numbers.

What Passed: Idaho and Indiana Signed Preemption Laws

Two states signed STR preemption into law during the 2026 session. Both take effect July 1, 2026.

Idaho HB 583: The Strongest Preemption Law in the Country

Governor Brad Little signed HB 583 on March 16, 2026. The bill passed the House 54-16 and the Senate 23-12.

Idaho already had a 2017 law barring cities from outright banning STRs. HB 583 goes considerably further. It classifies short-term rentals as a “nontransient residential use” for zoning and building code purposes, which means local governments can no longer treat STRs differently from any other residential property. If you have reviewed as many zoning codes as I have (and I sincerely hope you have not), you understand how significant that single classification change is. It closes every regulatory side door at once.

What cities and counties can no longer do under HB 583:

• Impose STR-specific permits or licensing requirements
• Cap the number of STR permits or set density limits
• Restrict the number of days a property can be rented
• Require owner-occupancy
• Impose operational or reporting mandates beyond what applies to all residential properties

What cities can still require (provided the same rules apply equally to all residential properties): smoke alarms, fire extinguishers, carbon monoxide detectors, escape ladders, and occupancy limits tied to International Building Code standards. The bill also requires STR platforms like Airbnb and Vrbo to register with the Idaho State Tax Commission and collect applicable state and local taxes.

For a deeper look at Idaho’s law, see our full analysis: Idaho Short-Term Rental Law 2026: What HB 583 Means for Hosts and Cities.

Indiana HEA 1210: The Preemption That Flew Under the Radar

Governor Mike Braun signed HEA 1210 on March 12, 2026. The STR preemption provision was tucked into an omnibus housing bill (part of a broader legislative package aimed at increasing housing supply), which is one reason it generated less attention than Idaho’s standalone measure.

HEA 1210 prohibits Indiana cities and counties from capping the number of residential rental properties. Lawmakers argued that rental caps, including STR density limits, restrict property rights and limit housing availability. Cities like Indianapolis and Fishers, which had been exploring rental cap policies, are now preempted from implementing them.

What this means for investors: Indiana is now a state where local governments cannot cap how many properties you can rent short-term. The scope is narrower than Idaho’s full preemption (Indiana cities can still require permits and impose other types of STR regulation), but the rental cap prohibition removes one of the most common tools cities use to limit STR growth.

What Failed: Washington and Colorado

Washington HB 2559: The STR Tax That Died Twice

Washington HB 2559 would have authorized local governments to impose a 4% excise tax on short-term rental bookings, layered on top of existing lodging taxes. This was not a preemption bill. It was a restriction bill designed to give cities a new revenue extraction tool that applied only to STRs.

The bill failed to advance before the Washington legislative session ended on March 12, 2026. More than 250 individuals testified during the hearing process, and the majority of testimony came from opponents. The Washington Hosts Collaborative Alliance led much of the organized opposition.

This was the second time this bill died. A version of HB 2559 passed the Washington Senate in 2025 with a 27-21 party-line vote (Democrats supporting, Republicans opposing), but House amendments sent it back to the Senate Rules Committee, where it expired. Supporters will almost certainly bring it back in 2027.

Colorado HB 1036: The Vacancy Tax STR Owners Killed

Colorado HB 1036 would have authorized local governments (with voter approval) to levy a tax on residential properties deemed “vacant.” Revenue was earmarked for affordable and workforce housing.

While the bill technically included exemptions for licensed short-term rentals, the STR industry saw a problem: owners who could not secure a local STR license due to permit caps or moratoriums could have been classified as “vacant” and taxed accordingly. COSTRA (the Colorado Short-Term Rental Alliance) led opposition, arguing the bill would penalize property owners caught in the gap between local permit restrictions and state tax policy.

The House Finance Committee voted 7-4 to postpone the bill indefinitely on February 9, 2026. Three Democrats joined all four Republicans to kill the measure after more than four hours of testimony.

The 2026 State-by-State Scorecard

What the Pattern Tells Investors

The 2026 session reinforced a trend that has been building for several years: state legislatures are more receptive to protecting STR property rights than to restricting them.

Every preemption bill that reached a floor vote this session passed with substantial margins. Idaho’s HB 583 cleared the House 54-16 and the Senate 23-12. Missouri’s SB 1066 sailed through the Senate 30-3. Indiana folded its preemption into an omnibus bill that passed with broad support. By contrast, every restriction bill either died in committee or failed to reach a vote before session ended.

The political math is straightforward. STR preemption aligns with property rights arguments that resonate across party lines. Restriction bills tend to split along partisan divides (Washington’s HB 2559 was a party-line vote). That asymmetry explains why preemption is advancing faster than restriction in most state legislatures.

For investors, the practical takeaway is this: states with preemption laws on the books are the most defensible markets for long-term STR investment. You are not just buying a property. You are buying regulatory certainty. Arizona, Florida, Idaho, and Indiana now offer that certainty at the state level. Missouri is on track to join them before May 15. States without preemption, and with active restriction debates (like New York and California), carry measurably higher regulatory risk.

This article provides general information and should not be construed as legal advice. Consult a qualified attorney in your jurisdiction for advice specific to your situation.

For a detailed look at how Florida’s preemption framework compares, see our guide: Florida STR Laws 2026: What the State Preemption Framework Means for Investors.

We do our best to keep our regulatory guides accurate and up to date, but ordinances change and we are only human. Always verify current requirements directly with your local municipality before making business decisions.

Not sure whether your target market has state-level preemption protection? Run it through the StaySTRA Analyzer to check the regulatory landscape and see how the numbers look before you buy.