This argument doesn't hold much water. There's many, many things you can't do in or with your own home due to various laws. There are externalities associated with lots of activities, and therefore these activities are regulated or outlawed. I can't use my home as a bar, or as a concert venue. I can't use it to tan leather, or operate a waste incinerator.
But you can let your druggie sibling live there for free. There's a reason why zoning laws exist, there's no good reason to disallow someone from doing what's effectively subleasing. It's been legal since forever.
