Is San Diego’s Short-Term Rental Program About To Collapse?

The question has to be asked: given the surprisingly low number of short-term rental applications the city has received, is San Diego’s vaunted short-term rental program on the verge of collapse?

We now know that from today UT part by Lori Weisberg

“In total, the city received 3,110 vacation rental inquiries from across the city, excluding Mission Beach,” said San Diego Communications Director Rachel Laing. For whole-home rentals in Mission Beach alone, application submissions totaled 1,291, she said.

Recall that the city was to organize a lottery to select only 5,416 candidates for licenses from the deluge of thousands who would apply. It didn’t work that way. The city received only 57% of this total. And now the city is holding an additional application period next week for a two-year license for hosts.

The problem, of course, is money. As Weisberg says:

Revenue from the required license fee, which amounts to $1,000 for a two-year license, will be crucial to fund the administration and enforcement of the new regulations.

City officials previously estimated that applications for the first round of all types of short-term rentals could generate more than $7 million. This funding could be insufficient if the city fails to attract many more applications.

So, to recap: the city expected 5,416 permit applicants, at $1,000 each, to win more than $7 million to fund enforcement of the new short-term rental regulations. But it received less than 60% of applications whose licensing fees would fund the program. (Mission Beach is in a special category – see below.)

Currently, with no more applicants, funding for the program appears to be in jeopardy. That’s why the city is reopening the application period, although officials don’t yet know how long they will maintain the reopening.

Mission Beach is a “cut” exception. The city has 1,100 licenses for this community – 30% of the housing in the community – and has received 1,291 applications, so there will be a lottery for Mission Beach.

The city planned to hire an IT consultant to help identify unlicensed listings for all home-sharing platforms like Airbnb and VRBO. But with the lack of fees, maybe this position will only be part-time, and the city’s law enforcement team that had to respond to complaints and remove harmful properties might not be as large. .

Venus Molina, Campbell’s chief of staff, must be wondering, “Where have all the short-term rental hosts gone?” It was Campbell, under Molina’s initiative, who led the negotiation of a “compromise” with billionaire roommate companies to establish the program in the first place, much to the chagrin of his constituents.

Of course, it’s not all over and maybe the city will receive enough license applications and fees to run the program. Stay tuned.

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