ARLINGTON, Va.—Today, the Institute for Justice (IJ) sent a letter to the town of Highlands, North Carolina, calling on officials to cease efforts to eradicate short-term rental properties in the town. This comes two years after IJ issued a similar warning to Highlands officials over a nearly identical proposal. 

Highlands town leaders are considering new legislation targeting legally operating short-term rentals in residentially zoned districts. If the ordinance passes, all of the town’s existing short-term rentals will be forced to shut down by September 15, 2027. Currently, the town considers short-term rental units in R-1 and R-2 zoned districts to be nonconforming uses of land but allows them to operate. 

This is the second time town officials have considered using a likely unconstitutional land-use tool called “amortization” to eliminate short-term rentals. Two years ago, IJ sent a separate letter to town officials urging them to abandon a proposal that would’ve empowered the town to use amortization to require short-term rentals to go through a registration and permitting process. It would’ve forced all short-term rentals to cease operation within three years. 

“Highlands has already kneecapped property owners by prohibiting them from offering their properties for rent on a short-term basis if they have not been doing so already,” said IJ Senior Attorney Ari Bargil. “With this proposal, the city council is considering pulling the rug out from under them entirely. But Highlands’ intended use of amortization is more than just another example of unfair or abusive zoning; the tool itself is unconstitutional. The Highlands City Council should be very cautious about using amortization to exterminate a legal and compatible use of property city-wide.” 

The town of Highlands’ new proposal rests on legally shaky ground—relying on a half-century old legal precedent that simply upholds the government’s power to moderate nuisances. Worse yet, the North Carolina Court of Appeals has already struck down a scheme like Highlands’, meaning if the town’s plan was challenged in court, it would likely lose, which could cost Highlands hundreds of thousands of dollars in legal costs. 

IJ is the nation’s leading law firm for liberty and recognized for its efforts to protect property owners. In addition to numerous successes at the state and federal level, including the U.S. Supreme Court, IJ has successfully litigated this issue in North Carolina before. Four years ago, IJ was victorious against the city of Wilmington, North Carolina, in a scheme that resembles what Highland plans to do. These efforts are all part of IJ’s Zoning Justice Project, which aims to end zoning abuse by protecting Americans’ right to productively and peacefully use their property.