Reported / Citable
Background
Four Grapevine homeowners — Kari Perkins, Kevin Perkins, Richard Mueller, and Pamela Holt — had operated their single-family residences as short-term rentals (rentals of less than 30 days) before the City of Grapevine moved to ban the practice. After a ten-month study period that documented resident complaints about noise, traffic, parking, and neighborhood disruption, the City Council passed a 2018 ordinance prohibiting STRs in residential zones. A 2024 ordinance reiterated the prohibition on single-family STRs while conditionally permitting STRs in certain multifamily settings. Both ordinances included legislative findings that STRs were incompatible with the residential character of single-family neighborhoods.
The Owners sued under the Texas Declaratory Judgments Act, arguing that both ordinances (1) violated the Texas Constitution’s due course of law, equal protection, and retroactivity provisions, and (2) exceeded the City’s authority under the Zoning Enabling Act as ultra vires acts. The trial court in Tarrant County granted summary judgment for the City on all claims and awarded the City its attorney’s fees. The Owners appealed.
The Second Court of Appeals had recently addressed nearly identical claims against a similar Fort Worth STR ordinance in Modern Builders, LLC v. City of Fort Worth, No. 02-25-00275-CV (Tex. App.—Fort Worth May 28, 2026). The Owners’ own appellate counsel acknowledged the cases were “strikingly similar,” and the court resolved this appeal by applying the reasoning of Modern Builders in full.
The Court’s Holding
The court overruled all three of the Owners’ constitutional claims, dismissed the ultra vires claim for want of jurisdiction, and affirmed the remainder of the trial court’s judgment, including the award of attorney’s fees. On the due course of law claim, the court held that the Owners had no vested property right — under the common law or under the preexisting Zoning Ordinance — to use their homes as STRs. Citing its earlier holding in Muns v. City of Grapevine and in Modern Builders, the court reaffirmed that property owners do not acquire a constitutionally protected vested right in a property use merely because that use was once permissible. Without a vested right, the due course of law claim failed at the threshold.
On equal protection, applying rational basis review, the court held that the STR ordinances were rationally related to the legitimate governmental purpose of preserving the residential character of single-family neighborhoods. The court found the City Council’s documented findings — rooted in resident testimony and a ten-month observation period — provided adequate rational basis, and rejected the argument that the 30-day cutoff distinguishing STRs from long-term rentals was arbitrary, noting that the Texas Legislature has used the same 30-day line in the hotel-occupancy tax statutes for over fifty years. The court similarly overruled the retroactivity claim, consistent with its analysis in Modern Builders, concluding that the ordinances did not unconstitutionally upset settled expectations protected by the Texas Constitution.
Key Takeaways
- Texas property owners have no vested constitutional right to use their homes as short-term rentals, whether grounded in the common law or in a prior zoning ordinance that was silent on rental duration.
- Municipal STR bans satisfy rational basis review when supported by legislative findings that transient rentals disrupt neighborhood character — courts will not second-guess the City Council’s policy judgment or subject its factual findings to courtroom scrutiny.
- A 30-day cutoff defining “short-term” rental is not constitutionally arbitrary; it tracks a distinction the Texas Legislature has used in the Tax Code for more than fifty years.
- Ultra vires challenges to municipal zoning ordinances must clear a jurisdictional threshold; if that threshold is not met, courts must dismiss for want of jurisdiction rather than reach the merits.
Why It Matters
This decision is the Second Court of Appeals’ second consecutive ruling — within weeks of Modern Builders — rejecting constitutional challenges to municipal STR bans in North Texas. Together, the opinions signal that Texas intermediate courts will apply a highly deferential standard when municipalities restrict short-term rentals in residential zones: so long as the city has documented neighborhood-character concerns and followed the proper zoning process, constitutional challenges are unlikely to succeed. Property owners cannot use substantive due process, equal protection, or retroactivity arguments to revive STR rights that were never vested under Texas law.
For practitioners, the rulings underscore that challenging an STR ordinance requires more than disputing the City’s data or labeling STRs “residential uses.” The rational basis standard insulates city council findings from courtroom fact-finding, and the absence of a vested right forecloses the strongest constitutional arguments at the outset. Municipalities considering STR restrictions should take note of the evidentiary record Grapevine built — a ten-month observation period, resident testimony, and detailed legislative findings — as the template courts appear to be validating.