San Diego recently approved a move that will nearly halve the number and bring the new total to about 6,500. What does this mean for short-term tenants in the city? In this article, we will review the current state of these rentals, what new laws are in place, and how this will affect landlords. Late transposition: The new rules will not enter into force until July 2022. That gives San Diego`s short-term homeowners just over a year to prepare. For the rental of entire homes that operate more than 20 days a year, the STRO permit application period is open from Monday noon to November 30 at 5 pm. Full resident permit holders will be announced by December 16. The application period for other types of licences remains open indefinitely. In short, here`s how the city of San Diego is reducing short-term rentals in 2022: As of July 2019, 16,000 units were used for short-term housing, according to a report from the city`s auditor. Of these, only about 6,600 paid the required temporary occupancy taxes. Mission Beach received an exception because of its long history of vacation rentals. Their community is limited to only 30% of the total housing units, which amount to about 1,100. „Hosts now know well in advance whether or not they will get a license, so the timeline certainly passes the smell test,“ said Mechanic, who sold his vacation rental company but remains involved in providing feedback to the city on how to implement the new regulations.
„I think there`s some nervousness on the part of the hosts because it`s part of people`s livelihoods, whether it`s how they pay their mortgage or get their kids into college. Mission Beach is the only neighborhood where the cap is raised to 30% of housing units due to its popularity with short-term rentals. Gary Wonacott, who has lived in the neighborhood for a long time, said he was disappointed that the new rules are moving forward. On April 6, the San Diego City Council passed new regulations limiting Airbnb-style rentals. As a result, the volume of short-term rentals is expected to decrease by 30%. The remaining questions revolve around how rental licenses are issued for short-term limited rentals and how much licenses cost. City Council will set fees later this year. In October, the Commission will update a proposal for licensing through a lottery system.
Jeff Macgurn has owned a Hillcrest property for nearly eight years, which he uses as a short-term rental for about 70% of the year. Although the new rules for all forms of short-term rentals were approved by the city council last year, they could not take effect in beach communities until the California Coast Commission intervened, which happened in March. However, the city agreed that hosts who regularly market their rentals on platforms like Airbnb needed more time to find out if they would get a lottery license before the summer season starts. This was done through the efforts of City Council Chair Jennifer Campbell. She found a compromise between Airbnb and VRBO, which represents rental service companies to landlords. This corresponds to a discount of 20 to 30% for short-term rentals. After years of inaction on how to legalize short-term rentals, elected leaders in San Diego agreed last year to limit the number of full-time units throughout the city to 1 percent of the city`s more than 540,000 housing units, or about 5,400. An exception was made for Mission Beach, which has a long history of vacation rentals. In this municipality, the allowance is more generous, with licenses limited to 30% of the total housing units in the municipality, or about 1,100. Short-term tenants in San Diego have to pay taxes on their annual profits. Two types of taxes must be declared: On February 23, 2021, the San Diego City Council passed the first reading of the short-term rental ordinance by an 8-1 vote.
If you wish to continue renting your property as a holiday home, you will need to apply for a permit again. The application period begins in the fall of 2022. If the total number of Stream 3 and Stream 4 applications received exceeds the number of licences available, applications will be selected by batch. Short-term tenants, who have long been able to rent out their San Diego apartments to visitors without formal regulation, will now have to apply for a license starting next month, hoping to get a coveted license as part of a municipal lottery. While short-term tenants have welcomed the delay in permitting as summer approaches, critics have remained skeptical that the city`s new regulations will make a difference in preserving the residential character of single-family neighborhoods. The Short-Term Housing Occupancy Ordinance (STRO) limits short-term vacation rentals to 1% of the city`s total housing stock, except in Mission Beach, where 30% of the units can be rented. Under the city`s new ordinance, that number will be cut in half, bringing the total for the new city of San Diego to about 5,400 units. It will also limit short-term rentals of more than 20 days per year to 1% of the city`s units. There are currently more than 500,000 housing units in San Diego. The STRO license is required from 1 May 2023. The law limits short-term vacation rentals to 1% of the city`s housing supply and prioritizes „good players“ in a lottery to determine who can offer properties for entire vacation rentals.
To fund the administration and enforcement of vacation rental regulations, royalties and application fees range from $100 for a two-year license for hosts who rent their properties less than 20 days a year to $1,000 for those who rent entire homes more than 20 days a year. Ironically, the Office of Independent Budget Analysis estimates that fewer short-term rentals reduce the city`s annual temporary occupancy tax revenue from $7.3 million to $4.4 million. That`s a loss of $2.9 million! Leave the city with a shortfall of $500,000. It will be interesting to see how the city gets more revenue from this ordinance. The legislation also has a good neighborhood policy wherein hosts and guests can be fined up to $1,000 for violating rental rules. Guests who rent an entire home in San Diego must stay at least two nights. Proponents of this issue, which has caused controversy and delays in the past, believe that if the council approves this law, there will be a structure for how rentals can operate in San Diego. This was previously considered virtually unregulated by Councillor Campbell and community leaders. A new roadmap posted this month on the city`s website identifies key deadlines as San Diego prepares to enact its vacation rental bylaws already approved on May 1 next year. WeLease handles all types of rental properties in the greater San Diego area. Our property management includes renting from single-family homes to large apartment complexes. Another advantage is passive income.
You receive monthly rental payments on a regular basis and don`t have to worry about a constant stream of guests. You also benefit from tax breaks if you own a rental property. „This vacation rental regulation was doomed from the get-go,“ said Matt Valenti, a tenant and member of Save San Diego Neighborhoods, who argues that vacation rentals in residential areas should be banned. „Our city is already unable to enforce the most basic quality of life issues, such as noise complaints. It will never be able to properly enforce this overly complicated system, resulting in the loss of increasingly affordable rental housing in San Diego. „I want to reassure citizens that this delay will actually ensure the success of the short-term vacation rental ordinance,“ said Councillor Jennifer Campbell, whose office revived efforts a few years ago to formally regulate short-term stays in people`s homes.
