In City of Dallas v. Dallas Short-Term Rental Alliance, No. 05-23-01309-CV (July 18, 2025), the Texas Court of Appeals affirmed a preliminary injunction, suspending operation of two ordinances which (1) restrict, and (2) require registration of short-term rentals in Dallas.

It’s a short opinion and up on appeal from interlocutory emergency relief, so there isn’t a ton there. But it is still worth reading because the court concludes the challengers have a likelihood of eventually showing that the ordinance restricting short-term renting violates “due-course-of-law” (aka substantive due process). Texas recognizes a property right in leasing property, and the owners here asserted they have a vested right to do so:

Under the circumstances, we conclude appellees Dallas Short Term-Rental Alliance, Sammy Aflalo, Vera Elkins, and Denise Lowry proved their probable right to relief against the City’s zoning ordinance under their due-course-of-law argument because they alleged they possessed well-established rights to lease their property and presented evidence tending to show that the City would deny them those rights by enforcing the zoning ordinance at issue.

…

Thus, the trial court did not abuse its discretion when it concluded these appellees met their burden to establish that they have a probable right of recovery on a cause of action concerning the zoning ordinance against the City of Dallas.

Slip op. at 8-9.  

The court also concluded that there’s a likelihood of success on the challenge to the registration requirement:

Thus, we conclude the trial court did not abuse its discretion when it concluded appellees have demonstrated a probable right to relief with respect to the registration ordinance because the City has failed to both (1) attack the trial court’s findings and (2) point us to evidence showing its legitimate governmental interests associated with restricting maximum occupancy in short-term rentals. Therefore, we cannot conclude the trial court abused its discretion when it concluded appellees are likely to prevail on their request for declaratory relief because the registration ordinance is likely unconstitutionally oppressive in light of the alleged but presently unsupported governmental interest in limiting the maximum occupancy of short-term rentals.

Slip op. at 11. 

Texas has been better for property owners than other jurisdictions on short-term renting. See, for example:

Onward. 

City of Dallas v. Dallas Short-Term Rental Alliance, No. 05-23-01309-CV (Tex. App. July 18, 2025)