THE FLIP
In Dallas, Even a Win in Court Leaves Hosts in Limbo
A temporary injunction has kept Dallas from enforcing its 2023 ban on short-term rentals in single-family zones for more than two years. On December 3, the Texas Supreme Court hears twenty minutes from each side on whether the city can enforce it while the hosts' lawsuit runs. Their lawyer says the ban outlaws more than 90% of the city's listings. A ruling is expected early next year.
Under that injunction, hosting a Dallas flip pays. At the city's average three-bedroom rate and occupancy, listed all year, a self-run listing nets about $2,706 a month after Airbnb's cut, power, yard care and an upkeep reserve. Leased, the same house nets $2,249. A mid-range furniture package costs $20,000, and at $457 a month it takes 44 months to earn back, starting in a winter when Dallas books its slowest nights.
Even the hosts' best day in court buys more limbo. A win keeps the injunction alive while the case goes back for trial, and month 44 stays a guess. We'd pay up to $255,000 for a 1950s three-bedroom, a price set by the resale alone, and put the rehab where a family buyer looks. The two-car garage a host would wall in as a fourth bedroom stays a garage.
What we'd do: bid $255,000 and let the $399,000 resale carry the whole deal, with the $20,000 of furniture waiting until a final judgment gives hosting more than 44 months to repay it. If the house hasn't sold by summer, we'd lease it at $2,499 a month.
THE NUMBERS
At $340 a night and 39% booked, hosting grosses $4,033 a month. Airbnb's 15.5% ($625), $400 of power, internet and supplies, $100 of yard and pest work and a 5% reserve ($202) leave $2,706. The $2,499 lease loses 5% to vacancy and the same 5% reserve, leaving $2,249. Both holds carry the same mortgage, so it drops out. This is a modeled house built from Dallas's citywide averages.
TOOL OF THE WEEK
CourtListener — Free court-opinion and docket alerts from the nonprofit Free Law Project.
When a short-term rental rule lands in an appeals court, CourtListener can email the opinion the day it publishes. A saved search for "short-term rental" or a city's name returns new appellate opinions, and a docket alert reports every new filing in a federal case. Alerts go out by email or webhook within seconds of the data arriving.
It earns its keep for an investor bidding in markets with live litigation, and for anyone tired of hearing about a ruling from a neighbor first.
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01 — The median U.S. home-sale price slipped 0.1% year over year through October 25, a second straight weekly dip after three years of gains. Pending sales hit the lowest level in records back to 2021, down 15.9%, and the typical payment rose 10.7% to $2,786. Prices barely moved. Buyers left, and a flip pays carry while they're gone. Source→
02 — For reservations booked from November 20, Airbnb will treat requests to strip beds, wash dishes or haul trash off-site as unreasonable, and guests may see an alert that a listing "includes cleaning requests." A host petition against the change passed 10,000 signatures. The labor doesn't disappear. It moves onto the cleaner's invoice, and from there into the nightly rate. Source→
03 — New Orleans voted October 15 to raise its nightly short-term rental fee to $20, from $5 for residential hosts and $12 for commercial, expecting about $3.5 million a year. A flat charge lands hardest on cheap nights, taking 13% of a $150 room and 5% of a $400 house. Here the fee pushes a host toward fewer, pricier nights. Source→
Worth Watching — Boulder had 1,525 homes cleared to advertise for Sundance (January 21–31) by October 1, beside about 2,900 hotel rooms. Airbnb says festival searches are up 500%, and a downtown two-bedroom asks $2,235 a night, up from $691. Those asks assume Park City's 85,000 attendees won't sleep in Denver or Longmont. Source→
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