In two recent legal cases, property owners successfully defended their right to operate and profit off a short-term rental, with support from the National Association of REALTORS®, state REALTOR® associations, or both.
One case was backed by NAR's Legal Action Program, which provides direct financial assistance and/or files amicus briefs to support litigation of significance to the real estate industry, the operation of real estate associations and private property rights. NAR maintains private property rights include “the right to rent out property on a short-term basis.”
“Legislative advocacy helps protect our industry through the lawmaking process, while the Legal Action Program helps protect it through the courts,” says Robin Dickson, who chairs the NAR committee behind the program. “Together, these efforts give REALTORS® an important voice in defending private property rights and the future of our profession.”
Court decisions can establish legal precedent with broad impact, which makes the program and the collaboration among all three levels of the REALTOR® organization, so important, Dickson explains.
“Local associations bring the boots-on-the-ground perspective, the state association adds a broader regional view, and NAR brings the national perspective and resources when a case has implications beyond one community,” she says.
Here's a breakdown of each ruling.
Ohio Case: Rudy v. Apple Valley Property Owners Association
On Aug. 13, an appellate court sided with homeowners, overturning a decision by the county trial court.
Filed in May 2024, the dispute centered on three homeowners who owned properties in an HOA development in Knox County, Ohio. The homeowners had been short-term renting their properties for several years, before the HOA proposed and approved a bylaw amendment to ban short-term rentals of periods less than six months.
The trial court sided with the HOA's argument that short-term rentals violated its restrictive covenant which barred “a business or commercial enterprise.” The homeowners appealed the ruling.
Citing robust case law, Ohio REALTORS® and NAR filed an amicus brief arguing short-term rentals do not constitute commercial use and that when a restrictive covenant is ambiguous, judges should adopt the least restrictive option: “Nothing in the deed restrictions prohibit an owner from deriving income from a ‘residential’ use of the property. By that token, an employee working virtually from their home office once or twice a week, or a babysitter watching a child after school until their parents return from work, could be considered a violation of the restrictive covenants.”
The panel of appellate judges sided with the homeowners.
Citing a separate Ohio appellate case, the judge wrote: “... Residential structures do not lose their residential character merely because the occupants are renters. ... The plain and unambiguous language of the Residential Declaration requires this Court to focus on what activity is being conducted ‘on said premises.’ Here, the activities occurring ‘on said premises’ are all residential activities, such as sleeping, eating, and cooking. There is no on-site signage, and no retail transactions occur on the premises."
“Ultimately, the appellate court determined that short-term rentals are not commercial activity, preserving important protections for private property owners in Ohio,
Ohio REALTORS® President Mic Gordon says. “It is a significant outcome not only for those who operate short-term rentals, but for the broader principle that property owners should be protected from unwarranted restrictions on the lawful use of their property.”
The legal collaboration is an example of the REALTOR® three-way agreement in action.
“We were grateful when the National Association of REALTORS® joined us in supporting the amicus brief,” says Ohio REALTORS® CEO Scott Williams. “NAR’s involvement underscored the significance of the issue and strengthened our collective efforts to advocate for private property rights.”
He added that should the decision be appealed, “Ohio REALTORS® and NAR are prepared to continue advocating for Ohio property owners before the state’s highest court.”
Idaho Case: Idaho Association of REALTORS®, Inc. v. City of Lava Hot Springs
On May 21, 2025, the Idaho Supreme Court ruled in favor of two homeowners and a REALTOR® association, reversing a district court verdict.
The case centers around John and Michelle Taylor who owned a home in Lava Hot Springs, Idaho, a tourist attraction despite its population of under 400 residents. The pair applied for a business license to short-term rent their home, but the city denied the license because of a local 2006 ordinance.
The ordinance only allowed short-term rentals that are owner-occupied—such as a bed and breakfast—in the city's residential zone; short-term rentals that were not owner-occupied needed to be in the city's commercial zone. The Taylors’ home, however, was in the residential zone.
In 2022, the pair and the Idaho REALTORS® sued Lava Hot Springs, arguing that the ordinance violated a statewide statutory provision, which forbade municipalities from prohibiting or regulating short-term rentals except when it comes to safeguarding “the public health, safety and general welfare” or the neighborhood.
A district court ruled in favor of the city, but the homeowners and association appealed and won.
Justices in the Idaho Supreme Court wrote in their opinion, "the City prevailed ... by arguing that its ban on vacation rentals in the City’s residential zones is permissible because its ordinance allows bed and breakfasts, one of the three types of short-term rentals defined in Idaho Code section 63-1804(4), in its residential zones. The argument is essentially that, so long as at least one type of short-term rental is allowed in its residential zones, the City has complied with the Act. We disagree.”
Association leadership celebrated the victory.
“This decision was a decisive win for private property rights in Idaho,” 2026 Idaho REALTORS® President Michelle Bailey says. “Ever since Idaho REALTORS® helped pass the original short-term rental statute in 2017, local jurisdictions have tested the law's limits, forcing litigation over private property rights up to the Idaho Supreme Court—and we won that case in a unanimous decision. Cities cannot use zoning as a backdoor to ban short-term rentals outright; the law protects homeowners' right to make reasonable use of their property.”
For more information about NAR's Legal Action Program click here.
