DALLAS — A two-year legal fight over the future of short-term rentals in Dallas is now headed to the Texas Supreme Court, as city leaders push to reinstate a 2023 ordinance that bans most rentals listed on platforms such as Airbnb and Vrbo.
The Dallas City Council approved the ban in 2023 after years of complaints from residents who said some short-term rentals had become hotspots for parties, crime and safety issues. Property owners and the Dallas Short-Term Rental Alliance quickly sued, winning a temporary injunction that has allowed rentals to continue operating while the case moves through the courts.
For some operators, including Dallas homeowner Stan Castloo, the injunction has kept a crucial income stream intact.
“Something in the neighborhood that the neighbors really disliked,” Castloo said of the condition of the home when he purchased it.
After extensive renovations, Castloo turned the property into a short-term rental that has now hosted “over, probably, 1,300 stays.”
Castloo said the city’s attempt to shut down rentals has created “a lot of anxiety.”
The Short-Term Rental Alliance says it wants a resolution that avoids prolonged litigation and allows for a negotiated set of regulations.
“What we really want to do is we want the lawsuit to go away, of course, and we want to come to the table with the city, and put something fair and reasonable together,” said alliance representative Lisa Sievers.
Residents who pushed for the ban told Spectrum News 1 in 2023 that some rentals had effectively become unregulated event spaces.
“He turned it into a party venue. He’s packing as many beds into places he can,” one neighbor said at the time.
After multiple failed attempts to have the injunction lifted, the city has petitioned the Texas Supreme Court, arguing it needs clarity and enforcement authority ahead of the 2026 FIFA World Cup. The tournament is expected to bring a $2 billion boost to the region’s economy, and city officials say proper oversight of rentals will be essential as tourism surges.
The alliance says short-term rental operators should be allowed to benefit from that influx.
“Can’t we share in that? And why can’t we share also with the small local businesses, who are in the neighborhoods, that we all support?” Sievers said.
The group has also begun offering classes to educate new hosts on responsible rental management.
The city declined to comment, citing the pending litigation.
Castloo said he is optimistic the state’s high court will side with property owners.
“But I look forward to hosting in the same way I do today: there will be no parties, there will be no events here at this property,” he said.