San Diego Short Term Rental Laws Go Into Effect!

Hey guys, San Diego just released new laws for short term rentals and everyone is wondering how this might affect our market! So here’s a detailed article breaking it all down for you.

So far folks have been able to do short-term rentals all over San Diego city without any hiccups. Now that the new laws have been approved and will go into effect this fall, everybody’s worried about how this will possibly flood the market with inventory among other concerns.

Number of properties allowed to be short term rentals

1% of the total inventory available in San Diego county can be designated toward short-term rentals. This leaves us with around 6,500 licenses that can be given out for short-term rentals. The one stipulation to that is Mission beach, where 30% of properties can be put up short-term. Based on my research, around 12,300-12,500 properties are currently short-term rentals.

No permit needed?

So when you look at the guidelines, a lot of properties will actually not fall into the category of needing a permit at all. These are the guidelines:

  1. Property rented out less than 20 days per year.
  2. If you live on site.
  3. If you have an ADU out back.

So out of a 100, there will likely be around 10-20 properties that are actually set-up as businesses that require permits. The rest of them are generally just folks casually renting out extra rooms and ADU’s so don’t get too excited about new property coming onto the market because it’s not likely to affect more than perhaps 1,000-2,000 homes. Also, many of those are likely to switch over to traditional long term rentals.

Where’s the opportunity?

Around 30% of people in Mission beach will be able to get licenses, but it’s also likely to affect around 25% of the current AirBnB’s in that market right now. This may result in some of those people selling, which would mean new inventory coming onto the market. Pacific Beach may also be similarly affected due to the fact that it’s a vacation area with a relatively large number of short term rentals. Just remember once again that this only affects San Diego city, not the county.

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