Montana Legislature passes bill regulating short-term rentals in homeowners' associations

The Montana Legislature convened on March 1, 2025, to introduce Senate Bill 336, a legislative proposal aimed at addressing the growing concerns surrounding short-term rentals in residential areas. This bill seeks to clarify the applicability of homeowners' association (HOA) bylaws and covenants regarding short-term rental properties, which have become increasingly prevalent in the state.

Senate Bill 336 includes several key provisions. Notably, it establishes that sections of the bill will be codified as integral parts of existing laws under Title 70 and Title 76, which pertain to property and land use regulations. The bill stipulates that it will apply retroactively to existing covenants and bylaws that do not explicitly address short-term rentals, thereby impacting a significant number of residential properties.

The introduction of this bill has sparked notable debates among legislators and stakeholders. Proponents argue that the bill is necessary to provide clarity and consistency for homeowners and associations grappling with the implications of short-term rentals. They contend that without clear guidelines, communities face challenges related to noise, safety, and property values.

Opponents, however, express concerns that the bill may infringe on property rights and limit the ability of homeowners to utilize their properties as they see fit. Some critics argue that the legislation could lead to increased regulation and oversight, which may deter investment in rental properties and negatively impact local economies.

The economic implications of Senate Bill 336 are significant, as the short-term rental market has become a vital source of income for many Montanans. The bill's retroactive applicability could lead to legal challenges from homeowners who feel their rights are being undermined. Additionally, the potential for increased regulation may influence the attractiveness of Montana as a destination for short-term rental investments.

As the legislative session progresses, the future of Senate Bill 336 remains uncertain. Lawmakers will continue to debate its provisions, and stakeholders will likely mobilize to advocate for their positions. The outcome of this bill could set a precedent for how short-term rentals are managed in Montana, shaping the landscape of residential property use for years to come.