San Diego Short Term Vacation Rental Ordinance: What You Need to Know
San Diego Short Term Rental Changes
Whether you’re looking to rent a property for a vacation or you’re a property owner wanting to make some money from your home, it helps to know San Diego Airbnb laws before you get started.
This is particularly true because, recently, San Diego changed the rules. You may be here because you saw a news story with a headline reading “San Diego places cap on whole home short term rentals.” Since the laws are changing, it’s a good idea to familiarize yourself with them.
Here are the San Diego short term rental regulations you should know.
What Is Defined as a Short-Term Rental?
In a nutshell, the City of San Diego defines short term rentals as those lasting less than a month in most cases. There are exceptions, but whole-home rentals are short term if a renter only occupies the property for less than 30 days.
When it comes to single-room rentals, the San Diego short term rental regulations can get more complicated. But, for most property owners renting out their homes as something like an Airbnb, 30 days is a good rule of thumb.
Are Short Term Rentals Allowed In San Diego County?
Short term rental in La Jolla. Image courtesy of Airbnb.com
Yes, short-term rentals are allowed in San Diego. There are, of course, rules and regulations governed by the San Diego Short Term Rental Ordinance. But, generally, short-term rentals are allowed.
It’s also worth noting that many of these regulations only apply in the city of San Diego. You might find different rules in other independent cities throughout the county, such as Oceanside or Encinitas.
Do You Need a Permit to Airbnb In San Diego?
Technically, yes. Before you can become an Airbnb host or rent out your property to guests, you will need to obtain a license. We’ll get to more of the specifics later on in this piece, but the short answer is that you’ll need to follow the San Diego short term rental ordinance.
The license itself is relatively affordable, but it requires that you pay a short-term rental tax to the city, as well as business taxes.
What Are the Rules on Shorter Vacation Rentals In San Diego?
The rules on short-term rentals depends on the type of rental, but here’s what you need to know about San Diego short term rental laws.
Short Term Residential Occupancy Licenses
Anyone in the city who rents their property or a portion of their property to a guest is subject to the City of San Diego Short Term Rental Ordinance. That means following Municipal Code requirements and obtaining a Transient Occupancy Registration Certificate.
The Transient Occupancy Registration Certificate requires a $25 application fee and a $100 license fee.
There are also four types of licenses that are issued depending on the exact circumstances.
Part-time licenses are for those people renting out a home for less than 20 days a year.
Home-sharing licenses are for those who rent out a room or multiple rooms in a home for more than 20 days a year.
Whole-home rental licenses are for property owners who rent out an entire home for more than 20 days a year.
It’s worth noting that, in the future, there will be a cap on licenses across San Diego. In Mission Beach, the cap is 30%. In the rest of the city, it’s 1%.
Short term rental in San Diego. Image courtesy of Airbnb.com
Transient Occupancy Tax
In addition to obtaining a Transient Occupancy Registration Certificate, property owners who rent out their homes as vacation rentals will also be subject to taxes per the San Diego short term rental ordinance.
Currently, the tax rate is set at 10.50% of earnings. The taxes must be remitted monthly and are due no later than the last day of the following month.
Rental Unit Business Tax
This isn’t specifically related to San Diego County short term rental laws, but it applies to those renting out their property. Basically, any business that operates in San Diego must pay business taxes to the city.
You’ll need to apply for a business permit before operating a vacation rental in San Diego. The tax itself will be set depending on how much revenue you make.
Why Do These San Diego Vacation Rental Laws Exist?
Many counties across the country require licenses or permits for short-term rentals. The recent addition of new ordinances and regulations in San Diego can be seen as a reaction to the lack of affordable housing in the city, as well as complaints from current residents.
San Diego is a tourist hotspot, meaning many local property owners rent out their housing. This drives up the cost of long-term housing in the city, particularly during peak tourism months. Residents also complain about lack of parking, tourists throwing parties, and other issues.
So there are regulations surrounding Airbnbs in San Diego, rules on whole-home rentals, and more to address these issues. These rules apply to all areas of the city, from the luxury Airbnbs of San Diego to more modest accommodations in Ocean Beach.
How Many Short Term Rentals Are There In San Diego?
Short term rental in La Jolla. Image courtesy of Airbnb.com
It isn’t clear how many short-term rentals there are in San Diego, but an estimate from March 2022 indicates that it might be around 12,300.
That will change when the recent San Diego city ordinance capping short-term rentals comes into effect. Under the new regulations, whole-home short-term rentals will be capped at 1% of the city’s total housing stock. That’s 5,400 short-term rentals.
There are a few exceptions to this. Mission Beach — a popular tourist destination — will be capped at about 30% of the housing stock. That’s about 1,100 short-term rentals in the neighborhood alone.
Altogether, there will be 6,500 licenses available for short-term rentals throughout the city of San Diego. That’s a competitive number and far below the 12,300 current rentals available. For fairness, the city will distribute licenses according to a lottery system.
Another exception is the category of hosted rentals, or a person living in a home renting out a room. There will be no caps on those.
The rules will go into effect in 2023.
How to Apply for a STRO License
At the time of this writing, property owners who want to get their STRO license application into the lottery can’t apply just yet. The city says they’ll most likely start the application period during Fall 2022; they’ll post updates on the official STRO page here: https://www.sandiego.gov/treasurer/short-term-residential-occupancy. You can enter your email address on that page to be notified of updates, but it still might be a good idea to visit that page frequently if you’re a property owner.
