What should you know before buying a second home in Arizona? Three things shape the deal: how you finance it, how it's taxed and whether you'll rent it. Fannie Mae's rules define a second home as a one-unit home you occupy part of the year and control exclusively, not a rental. In Maricopa County, a secondary home is typically class 4.1 for property taxes and doesn't get the state aid that lowers school taxes on primary residences.
Why Arizona for a second home? For many buyers, it's the winter climate. NOAA's normals for Scottsdale Airport show average highs of 74.8°F in November, 64.6°F in December and 66.5°F in January. A second home lets you enjoy those months and lock up for summer.
Data note: Loan rules come from Fannie Mae's Selling Guide B2-1.1-01; tax classifications from A.R.S. 42-12003, 42-12004 and the Maricopa County Assessor; tax rules from IRS Publication 527; weather from NOAA NCEI 1991-2020 normals. General information, not tax, legal or lending advice.
Financing a Second Home
Fannie Mae's second-home requirements:
- Occupied by you for some portion of the year
- One-unit dwellings only
- Suitable for year-round occupancy
- Your exclusive control over the property
- Not a rental property or timeshare
- No management agreement that gives a firm control over occupancy
- Underwritten in DU with an Approve/Eligible recommendation
- An extra loan-level price adjustment applies to certain second-home loans
Second Home vs. Investment Property
- If you plan to rent it out as a business, lenders treat it as an investment property, with its own pricing adjustments
- Fannie Mae notes a loan can still be delivered as a second home if a lender identifies rental income, as long as that income isn't used to qualify and all other second-home rules are met
Buying above the conforming limit? See our guide to the Maricopa County jumbo loan limit.
How Arizona Taxes a Second Home
- Class 3 (A.R.S. 42-12003): owner-occupied primary residences
- Class 4 (A.R.S. 42-12004): residential property not otherwise classified, including rentals
- Class 4.1: the Assessor's category for a home that's not a registered rental, giving a secondary home as the example. It does not qualify for state aid
- Class 4.2: a registered rental property
The state aid is the homeowner rebate that reduces school district taxes on primary residences. Our Arizona homestead exemption guide explains how it works.
If You'll Rent It Out
Register With the Assessor
- The Maricopa County Assessor requires registration of residential property used solely as a rental
- Owners who live outside Arizona must name a designated agent in Arizona
- Questions: Assessor's Office, 602-506-3406
Short-Term Rentals
Cities and the state have their own licensing and tax rules. Our Scottsdale short-term rental rules guide covers them.
IRS Day-Count Rules (Publication 527)
- Used as a home: your personal use is more than the greater of 14 days or 10% of the days rented at a fair price
- Minimal rental use: if you use it as a home and rent it less than 15 days a year, that period isn't treated as rental activity
Practical Questions for a Part-Time Home
- Who checks on the house while you're away? Plan for periodic visits
- Summer settings: thermostat, pool equipment and irrigation timers
- Insurance: ask your agent how the policy treats a home that's unoccupied for stretches
- HOA rules: check rental limits and guest policies before you buy
- Mailing address: keep it current with the Assessor so tax bills reach you
“Second-home buyers often fall for a view first and ask about taxes and rentals later. I like to flip that order: decide how you'll use the home, talk with your lender and tax advisor, and then we shop with those answers in hand. It makes the right home much easier to recognize.”
— Elizabeth Vijan, Tackett Team, eXp Realty
FAQ: Second Homes in Arizona
What counts as a second home for a mortgage?
One unit, occupied by you part of the year, under your exclusive control, and not a rental.
How are second homes taxed in Arizona?
Typically class 4.1, without the state aid primary residences get.
Can I rent out my second home in Arizona?
Yes, with registration, local rules and lender occupancy terms.
How many days can I rent my second home without paying tax on the rent?
IRS: less than 15 days isn't treated as rental activity if it's used as a home.
Shopping for a Winter Home in Scottsdale or Phoenix?
I'll help you find a second home that fits how you'll really use it, and connect you with lenders and advisors who know the rules.
Elizabeth Vijan | Tackett Team, eXp Realty
Scottsdale & Phoenix Real Estate
Let's Talk · Call or text 602-885-7752
Sources: Fannie Mae Selling Guide B2-1.1-01: Occupancy types · A.R.S. 42-12003: Class 3 property · A.R.S. 42-12004: Class 4 property · Maricopa County Assessor: Residential rental registration · IRS Publication 527: Residential rental property · NOAA NCEI: 1991-2020 monthly normals, Scottsdale Airport
Disclaimer: General information, not tax, legal or lending advice. Confirm with a licensed lender, tax professional and the Maricopa County Assessor. Information deemed reliable but not guaranteed. Equal Housing Opportunity.
Tackett Team, eXp Realty · Get in touch