Fifth Circuit: there is no protected property right in leasing your home short-term
Fifth Circuit: there is no protected property right in leasing your home short-term
2026-09-15 · Mississippi · Courts
The federal appeals court that governs Mississippi has held there is no constitutionally protected property interest in leasing a home on a short-term basis, and that drawing the line at 30 days is not arbitrary. Marfil v. City of New Braunfels, No. 25-50025, was decided June 18, 2026 and is published and binding in the Fifth Circuit, which covers Mississippi, Louisiana and Texas.1
The case
New Braunfels, Texas adopted a zoning ordinance — chapter 144 § 5.16, enacted in 2006 and amended in 2011 — barring short-term rentals, defined as occupancy “for less than 30 consecutive days,” in districts zoned Residential. Property owners sued on due process and equal protection grounds. Every plaintiff had bought after the ban was already on the books.
The panel was Higginson, Willett and Engelhardt, with Higginson writing. Summary judgment for the City was affirmed.
The two holdings
Due process. The owners' theory required Texas law to recognise a protected property interest in “the right to lease one's home on a short-term basis.” The court held Texas courts have squarely held it does not — so there is no property interest for due process to attach to.
Equal protection. Applying rational-basis review, the court held that preserving the residential character of neighbourhoods is a legitimate government interest, and that the line between rentals under 30 days and longer ones is not arbitrary.
What this means for a Mississippi association — and what it does not
Start with the limit, because it is the part most likely to be overstated. Marfil is a municipal zoning case, not a covenant case. A Mississippi board cannot cite it as directly controlling a dispute under a recorded declaration. The state-action requirement that makes constitutional claims available against a city does not ordinarily reach a private association at all.
What it does is remove the arguments an owner would most likely bolt onto a covenant challenge. Owners contesting rental restrictions routinely plead constitutional theories alongside the contract ones: that the restriction takes a property right, that it denies due process, that it treats short-term and long-term rentals differently without reason. Marfil answers all three against the owner, at the level of binding circuit precedent, in the circuit that includes Mississippi.
It is also the reasoning a federal judge in the Southern District of Mississippi would reach for first if a Gulf Coast rental-restriction dispute landed there.
The companion case, six weeks later
The Fifth Circuit did it again in August. Bodin v. New Orleans, No. 25-30524, decided August 5, 2026, rejected a takings challenge to New Orleans ordinances limiting non-commercial short-term rentals to one per block, allocated by lottery. The court found neither a per se nor a regulatory taking — no physical appropriation, no severe impairment of investment-backed expectations — and held the ordinance a reasonable zoning regulation. It separately held that platform booking and verification duties imposed on Airbnb do not treat it as the publisher or speaker of third-party content, so § 230 does not preempt them.2
Two decisions in seven weeks, both rejecting owner-side constitutional attacks on short-term rental restrictions. For Mississippi Gulf Coast associations, that is the strongest signal in years that federal constitutional theories against rental restrictions are dead ends in this circuit.
Where a Mississippi covenant fight is actually decided
With the constitutional overlay gone, a rental-restriction dispute in a Mississippi association turns on state covenant doctrine, which is largely judge-made and not especially friendly to associations:
Does the covenant actually restrict rentals? A “single-family residential use” clause is not self-evidently a rental restriction, and Mississippi construes restrictive covenants strictly, resolving ambiguity in favour of the free use of land.
Was the restriction validly adopted? A rule adopted by a board, as opposed to an amendment to the declaration recorded per its own amendment clause, is on much weaker ground.
Has it been enforced? After Sea Breeze Condominiums v. Lyons, decided September 10, 2026, an anti-waiver clause does not dispose of a waiver defence as a matter of law — and years of tolerated short-term listings are exactly the fact pattern that raises one.
What to watch next
Whether an owner in this circuit reframes the challenge as a pure contract case. That is where the remaining arguments are, and Mississippi's strict-construction rule is where an owner would want to make them.
Related Mississippi HOA Topics
Stay on top of Mississippi HOA law
Every week: new Mississippi legislation, court rulings, and regulatory developments affecting condos, planned communities, and property managers. Free.
No spam. Unsubscribe anytime.