Court rules Austin short-term rental ordinance unconstitutional

AUSTIN (KXAN) -- A federal judge ruled Tuesday in a lawsuit against the City of Austin for its short-term rental (STR) ordinance, which a Houston couple said unfairly prevented them from listing their Austin property, according to court documents.

The ruling from Senior U.S. District Judge David Alan Ezra granted plaintiffs Robert and Roberta Anding's motion for summary judgement, and rejected the City's motion to dismiss the Anding's claims.

“The City is disappointed with the ruling and is evaluating how best to regulate short-term rentals going forward," a City of Austin spokesperson said.

Ezra's full ruling can be read below:

The Andings, who are Houston residents, acquired a six-bedroom property next to Lake Austin in 2014 with the intent of operating it as a STR. In 2016, the City of Austin issued an ordinance that prohibited non-residents from listing properties in such a manner.

In a previous case in 2019, an Austin Appeals Court ruled against the City's ordinance as unconstitutionally retroactive, which should have allowed the Andings to apply for a STR license with the city. However, the Andings claim that the City never granted their application.

In the couple's proposed order, it states that the City's ordinance discriminates against non-residents like them in violation of the dormant Commerce Clause of the U.S. Constitution. It also asked for the judge to rule the City's ordinance as unconstitutional.

With Ezra's ruling, that proposed order was granted.