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In a decision handed down on Friday, the Texas Supreme Court ruled unanimously that homeowner associations are not allowed to restrict homeowners from renting out their homes through short-term rental services such as Airbnb.

This case stems from a 2012 incident where a San Antonio resident, Kenneth Tarr, was renting out his home for short periods of time after relocating to Houston for work. His homeowner’s association decided this was prohibited, claiming it didn’t fall under the category of ‘residential’ use that his home’s deed allowed.

In its ruling, the Texas Supreme Court determined that short-term rentals constitute a residential purpose and that the deed did not prohibit Tarr from engaging in the short-term rental market.

This is a victory for Texas property owners and serves as an indication of the court’s viewpoint on short-term rentals, a perspective that will be critical in an upcoming case on Austin’s ban of short-term rentals. Attorney General Ken Paxton has indicated strong support for the rights of homeowners on this issue, joining forces with the conservative Texas Public Policy Foundation, the group representing the plaintiffs in the case.

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