Short-Term Rentals

Legal restrictions on short-term rentals are diverse and confusing. Short-term rental websites provide little help in complying with these laws.

Santa Monica has instituted the nation’s toughest regulations on short-term rentals, Manhattan Beach followed suit, and Los Angeles is considering it. West Hollywood wants to ban them altogether.

In Santa Monica hosts will have to live on the property during the renter’s stay, register for a business license, and collect the city’s 14-percent transient occupancy tax (TOT). According to the LA Times, this could shut down about 80 percent of the short-term rental listings. City officials say their reasons include the overall increase in housing prices, the potential decrease in the housing supply, and the potential for the community to look like a transient community.

Pushback is coming from organizations such as the Los Angeles Short Term Rental Alliance, which represents about 500 people. This group says that there have been beach rentals as long as there have been beachfront properties, and the regulations will hurt people on sabbatical or those seeking seasonal income, as well as reducing city revenue and generating additional personnel and paperwork.

San Francisco created a new agency to oversee short-term rentals. The Office of Short-Term Rental Administration and Enforcement will manage rental applications and coordinate efforts to pursue violators. The move is a response to the city’s effort to limit the length of stays for short-term rentals, amid concerns from opponents who say they may drive up prices for long-term renters. While the rentals generate revenue for residents in the city and promote tourism, local regulations need to be followed "to protect our housing supply and neighborhood character," proponents of the move say.

Written by Jane Carlson, an Associate at RSG.