New Regulations for Short-Term Vacation Rentals

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The topic of short-term vacation rentals (STVR), has been one of contention in San Diego for quite awhile now. Home owners and investors have been renting homes through sites like Airbnb for periods less than 30 days. Detractors note that these units create hotels in residential areas which brings with it assorted problems. It is estimated that approximately 11,000 homes across San Diego County are being used as short-term vacation rentals, with the majority located in coastal communities. Recently, the mayor and city council, took up the issue. While the regulations are not yet finalized, here are some of the main points that came out of the meeting.

 

  • STVR’s will need to be licensed with the city and pay an annual fee of $995.

 

  • STVR’s are only allowed for an owner’s primary residence and one investment property. There may be a loop-hole, however, if a property is sub-leased.

 

  • Properties can only be available for rent, on a short-term basis, for 6 months out of the year.

 

  • A proposal to carve out Mission Beach, an area estimated to have 44% of housing stock being rented as STVR, was rejected

 

  • Online platforms used to market STVR’s will have to comply with the new laws and display the required license number for homes. Failing to do so will likely carry stiff penalties.

 

  • These new regulations take effect July of 2019.

It looks like these new regulations are about to cause strain in the short-term vacation rental industry. What do you think? Does this law go far enough? You can also read about it here or here.
It has been my view that the purchase of residential units, with the goal of increasing returns through short-term rentals, was a risky strategy due to potential regulation. With these new laws, my hunch has shown to be correct. If you have a property that no longer is generating the returns you require, contact me. Would be happy discuss some additional options you may have.