What Are the Legal Considerations for Short-Term Rentals?

What is compliance in real estate

Navigating the world of property management in La Jolla, San Diego, CA can be a challenging feat, especially in terms of new amendments to associated regulations which are already difficult to keep up with. The debate over sharp new restrictions on short-term vacation rentals in La Jolla and other areas across San Diego is still ongoing. 

Those negatively affected by the potential new regulations have lodged legal protests on multiple occasions, while supporters continue to advocate for a step in this direction. 

What actions are being considered in order to legalize home sharing and Airbnb and Airbnb-style rentals according to the decision reaffirmed in the recent second reading of the July 2018 ordinance? So who will eventually call the shots and what do these potential changes mean for those in the short-term rental business?

What do the new regulations stipulate?

According to supporters of the new regulations, short-term rentals are wreaking havoc on San Diego neighborhoods. Furthermore, renting a house in a single-family zone for a period of less than 30 days is not permitted by the current San Diego Municipal Code. 

By majority vote, the Council has reached the following decisions:

  • Short-term stays will be limited to a person’s primary residence only. The only exception are additional units on the same property for which a second vacation rental license can be obtained.
  • Hosts will be able to rent out the primary residence in their absence.
  • The maximum rental period is up to 6 months a year.
  • Hosts must apply for special permits and pay annual fees in a timely manner.
  • The annual fee shall be $949. 
  • A three-night minimum stay duration will apply in the more saturated areas of San Diego such as downtown and coastal areas.

What are the key issues with the new regulations?

Slashing the number of Airbnb and Airbnb-style rentals which would reduce their numbers by roughly 60% according to some estimates on account of the primary-residence-only requirement would devastate the business economy in the coastal and downtown areas of San Diego.

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The matter is further complicated by the following issues: 

  • The City Council and the California Coastal Commission have to chime in before any such regulations can be enacted. The City Council has voted in favor of the regulations, but the California Coastal Commission generally favors vacation rentals so the regulations are unlikely to fly.
  • A written description of the regulations could be interpreted as a violation of the Brown Act as it erroneously exempts Mission Beach community from the new set or rules.
  • Adopting these regulations would mean that new code enforcement officers would need to be hired, which in turn would lead to a rise in license fee costs. 
  • A compromise plan was initially proposed by San Diego Mayor Kevin Faulconer, but it was rejected by the Council. The plan envisioned that up to 2 short-term rental permits be available to the residents of San Diego and a single permit be available to non-residents. The only exception to this rule would be that San Diegans who have two units within the same property, namely, the primary residence and an additional unit, could apply and be issued a licence for the second vacation rental.
  • There is a risk that imposing the new regulations could lead to a rise in property listings on the black market.

What is compliance in real estate?

Real estate compliance encompasses the sets of regulations that govern properties, including short-term rentals. A property manager can help you keep up with applicable regulations and stay compliant. A responsible and responsive property manager will be at your service to address your concerns and enable you to respond to changing regulations in a prompt and timely manner.

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We understand that being on the lookout for the latest changes to applicable laws and regulations can be daunting, tedious, time-consuming and even frustrating. The pressure continues to rise and the future is uncertain. But that is where we come in to share some of the burden and make things easier for you. 

At Lofty Property Management, we offer our clients running Airbnbs or similar short-term rentals the opportunity to stay in full control of their property while streamlining the whole process. You get a steady stream of revenue without having to worry about all the pesky paperwork, non-background checked tenants, vendors and contractors and nasty evictions. Let us take over the management of your property and give you back your peace of mind. Call now!