Airbnb and Short-Term Rental Laws in California

California, the land of sunshine and opportunity, also boasts a thriving vacation rental market. But before you dive headfirst into listing your charming beach cottage or trendy city loft on Airbnb, there's one crucial hurdle to navigate: the intricate web of Short-Term Rental (STR) laws that vary across the state.

Understanding these regulations is essential to operate legally, avoid hefty fines and ensure a smooth hosting experience.

What is a Short-Term Rental in California?

The state of California defines a short-term rental (STR) as a residential property or portion of such property that is rented to an individual or group for not more than 30 consecutive days.

This definition is generally applied by most Californian counties and cities. However, some localities may include language that applies further specifics, confining what can be considered to be a short-term rental even further.

Some even define short-term rentals and vacation rentals differently, with a few localities banning short-term rentals while allowing for vacation rentals. Others restrict renting out on the short term for a short period of time each year.

Airbnb and Short-Term Rules in California

Being the state in which Airbnb originated, it is no surprise that the Airbnb vacation rental industry has grown exponentially in California since the platform started. However, variations exist and specific considerations include:

Local regulations

Each city and county has its own unique set of rules, governing permits, licensing, zoning, rental limits, taxes and even good neighbor policies. Researching and understanding your specific locality's regulations is crucial.

Transient Occupancy Tax (TOT)

Most California jurisdictions levy a Transient Occupancy Tax on short-term rentals, ranging from 6% to 14%. Platforms like Airbnb often collect and remit this tax on behalf of hosts, but understanding your local tax obligations is essential.

Host responsibilities

Hosts are responsible for complying with local tax regulations, which may include collecting and remitting Transient Occupancy Tax and other applicable taxes. Registering with local tax authorities and filing regular reports is often required.

Zoning laws

Zoning laws determine where short-term rentals can legally operate. Some areas have blanket bans, while others have designated zones or specific limitations.

Short-Term Rental Law General Guidelines Across California

Registration and fees

Most California cities mandate that short-term rental businesses register their properties and/or businesses, accompanied by varying fees based on the municipality.

Occupancy limits

Short-term rentals are often required to be primary residences, with the definition varying between cities. Primary residence criteria may involve residing at the rental for a minimum period annually (ranging from 60 days to 9 months).

Some cities impose restrictions based on dwelling type, location, occupant number and minimum stay length.

• Dwelling type: Restrictions on the percentage of short-term rental units in multi-unit residential complexes or limitations on certain accessory structures.
• Dwelling location: Restrictions to specific zones or districts within a city.
• Occupant number: Capping occupancy, often limiting it to two adults per bedroom.
• Minimum stay length: Mandating a minimum number of days for reservations.

Safety measures

Safety measures are crucial, and ordinances commonly include:

• Emergency information: Clearly stated information about emergency exits and fire extinguisher locations.
• Designated contact person: Many cities require a local contact person for issue resolution, especially for un-hosted rentals or when the host is away.
• Building and safety codes: Compliance with local building and safety codes is essential for maintenance.

Neighborly conduct

Regulations often aim to maintain neighborhood well-being with restrictions on:

• Noise: Compliance with local noise ordinances is typically required.
• Parking: Some cities enforce parking limitations, especially in congested areas.
• Trash: Guidelines for garbage disposal may be imposed on short-term rental units.

Short-Term Rental and Airbnb Regulations in Major California Cities

San Diego short-term rental laws

The Short-Term Residential Occupancy Ordinance in San Diego allows for short-term rentals lasting up to 30 days at a time. Hosts must acquire a license based on the nature of their rental, categorized into four tiers:

1. Tier 1 (Part-Time): For rentals not exceeding a total of 20 days annually, with no requirement for owner or permanent resident presence.
2. Tier 2 (Home Sharing): Involves renting a room or rooms in a residence for over 20 days a year, provided the owner or permanent resident resides on the premises. Residency exception is permitted for up to 90 days per calendar year.
3. Tier 3 (Whole Home excluding Mission Beach): Pertains to renting out the entire property for a minimum of 90 days each year, with the owner or permanent resident not living onsite.
4. Tier 4 (Whole Home Mission Beach): Functions similarly to Tier 3 but applies specifically to rentals located in Mission Beach.

Each host can hold only one license, valid for a period of two years before renewal. The ordinance also outlines varying license fees, starting from $100 for hosts renting properties for under 20 days annually, rising to $1,000 for those leasing entire homes for over 20 days each year.

Additionally, vacation rental hosts in San Diego are subject to two types of taxes imposed by the city:

• Transient Occupancy Tax: Set at 10.50%, collected, and remitted by platforms like Airbnb.
• Rental Unit Business Tax: Another tax levied by the city.

Los Angeles short-term rental laws

Los Angeles, a renowned destination for both local and international tourists, implements strict regulations concerning short-term rentals.

Governed by the Los Angeles Municipal Code, the city aligns with the state's definition of short-term rentals, permitting "home-sharing" exclusively in the host's primary residence for a maximum of 120 days annually. To operate an Airbnb vacation rental in Los Angeles, hosts must obtain a home-sharing permit and renew it annually.

If you want to host for longer you will have to apply for extended home-sharing. The city’s zoning laws also severely restrict vacation rentals in its residential zones.

The city of Los Angeles imposes a transient occupancy tax of 14% and a Per Night Administrative Fee of $3.10 per night for reservations 30 nights or less. These are collected and paid by Airbnb on behalf of its hosts.

San Jose short-Term rental laws

According to the San Jose Municipal Code, incidental transient occupancy is defined as the use or possession of any room or rooms, or portions thereof for dwelling, sleeping or lodging purposes in any one-family dwelling, two-family dwelling, multiple dwelling, mobile home, live/work unit or accessory dwelling unit, of a transient user.

The city permits short-term rentals that have owners present and those that don’t. However, if the host is not present, the total rental period for a year is limited to 180 days.

When the host is onsite, maximum guest occupancy is limited to 3 guests per one-family dwelling or mobile home and 2 guests per dwelling unit in a two-family or multifamily dwelling.

If the host is not present at the property, occupancy limits are 2 guests in a studio unit, 3 guests in a 1-bedroom unit, and 2 guests per each additional bedroom. The total number of guests however cannot exceed 10 persons at a time.

San Jose requires vacation rental hosts to obtain a general business license.

The city imposes a transient occupancy tax (10%) which is collected and paid on behalf of hosts by Airbnb.

Palm Springs short-term rental laws

The city of Palm Springs refers to short-term rentals as vacation rentals and defines them as stays of not more than 28 days at a time. The city limits vacation rental and home-sharing lodging to single-family dwelling units and prohibits such lodging in apartments.

To operate an Airbnb in Palm Springs, you need to apply for a vacation rental certificate. The city offers three types:

• Vacation Rental Certificate (when the owner is not present during stays)
• Homeshare Short-Term Vacation Rental Certificate (when the owner is present during all stays)
• Junior Vacation Rental Registration Certification

An owner can only obtain a single certificate at a time. Certificates must be renewed annually. Applicants must also supply a letter from their HOA permitting them to operate an Airbnb.

Hosts are only allowed not more than 32 guest stays per calendar year plus four more guest stays in July, August, and September, for a maximum of 36 guest stays each year. Homeshares, however, do not have such annual limits. Occupancy is limited to 2 guests per bedroom and parking to 1 vehicle per bedroom.

Palm Springs also requires a “responsible person” over the age of 25 years to sign a contract with the operator, meet and greet guests in person to explain the local rules and regulations and obtain a signature of receipt of the Statement of Rules and Regulations/Good Neighbor Brochure.

The city of Palm Springs imposes a transient occupancy tax (11.5%) and a tourism business improvement district (1%).

Staying on Top

Unlike states such as Wyoming, where regulations on short-term vacation rentals are minimal, cities in California have implemented laws to govern and restrict such rentals.

The laws, regulations and taxes applicable to Airbnb vacation rentals differ by location. Apart from city codes, rules including taxes imposed by relevant counties may also apply.

Each municipality has its own set of requirements including residency, permits and licensing, zoning, health and safety regulations, insurance, occupancy limitations and good neighbor policies.

Hosts should also be mindful of regulations established by neighborhood associations, including homeowners’ associations, condo boards, and other tenant organizations.