Scottsdale may not require owner-occupancy as a condition of building or operating an accessory dwelling unit. Ariz. Rev. Stat. Sec. 9-461.18 (HB 2720) preempts owner-occupancy mandates for cities over 75,000 population. Scottsdale's ADU code amendments adopted in 2024 removed any prior owner-occupancy condition. Investor-owned ADUs are permitted on single-family lots, although ESLO and HOA constraints remain.
Under Arizona Revised Statutes Sec. 9-461.18, enacted by HB 2720 in 2024, Scottsdale is prohibited from requiring the property owner to occupy either the primary dwelling or the ADU as a condition of building or operating the unit. This represents a significant change from many Arizona cities' prior pilot programs, which often required owner-occupancy. Scottsdale's 2024 amendments to the Zoning Ordinance implemented this state preemption, removing any owner-occupancy condition for ADUs that meet the by-right standards. Investor-owners and out-of-state property owners may construct and rent both the primary dwelling and the ADU to separate tenants without violating zoning. The state statute also prohibits Scottsdale from limiting the number of related or unrelated occupants in either unit beyond the building code's life-safety occupancy load. Homeowners associations recorded after the effective date of HB 2720 cannot enforce contrary owner-occupancy covenants on covered ADU lots - though older recorded CCRs are not all preempted, and Scottsdale's extensive HOA-governed master-planned communities (DC Ranch, Grayhawk, McDowell Mountain Ranch, Troon, etc.) commonly have separate constraints worth reviewing with counsel.
Scottsdale cannot enforce owner-occupancy as a condition of ADU permits or operation under Ariz. Rev. Stat. Sec. 9-461.18. Any attempt to impose owner-occupancy through code enforcement, business license denial, or new HOA covenants on covered ADU lots can be challenged in state court. Owners do not face City enforcement for renting the main house and ADU to separate non-related tenants.
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