Short-term rental regulations remain one of the most important real estate issues in Teton Valley, especially for second-home buyers, investors, and sellers marketing income-producing potential. In Driggs, a proposed Land Development Code amendment could significantly change how short-term rentals are classified and allowed within the city.
The City of Driggs is holding a public hearing for AMD26-2, a proposed amendment to Article 10.3.4 of the Land Development Code regarding short-term rentals. The purpose of the amendment is to bring Driggs’ local zoning regulations into compliance with 2026 Idaho House Bill 583, which takes effect July 1, 2026.
The most important proposed change is that Driggs would remove existing land-use restrictions on short-term rentals by reclassifying “short-term rental use” as “non-transient residential use” across all residential zoning designations. In simpler terms, STRs would no longer be treated as a limited use in residential zones. Instead, they would be permitted in all residential zoning districts, aligning local code with state-mandated STR definitions.
For buyers, this could expand the range of properties where short-term rental use may be allowed, making Driggs more attractive for second-home owners and investors seeking rental flexibility. However, buyers should still complete full due diligence. City code is only one layer. HOA rules, subdivision covenants, parking requirements, occupancy standards, wastewater capacity, business licensing, and insurance may still affect whether a property can practically operate as a short-term rental.
For sellers, the proposed change could strengthen marketing for properties in residential zones, especially if rental flexibility becomes clearer and less restrictive. Homes with documented rental history, favorable HOA language, strong location, and compliant setup may stand out more to buyers.
The Planning & Zoning Commission reviewed the proposed amendments during a June 10, 2026 public hearing and recommended approval. City Council will make the final decision.
In today’s Teton Valley market, short-term rental flexibility is not just a side note. It can influence buyer demand, property value, financing strategy, and negotiation power.
