San Diego reaffirms vote to sharply reduce short-term rental volume

San Diego City Council on Tuesday officially confirmed its decision in February to impose an annual cap on whole-home vacation rentals, which could potentially reduce volume by 30%.

To enact the new regulations governing Airbnb-style rentals, the board had to approve a second reading of the order it approved following a six-hour hearing on February 23. The new rules will not come into effect until July of next year. Councilor Joe LaCava, whose district includes La Jolla, cast the only dissenting vote, as he did in February.

Under the new plan, whole house rentals available for more than 20 days per year will be capped at 1% of the city’s over 540,000 housing units, or around 5,400. An exception, however, has been made. for Mission Beach, which has a long history of vacation rentals that predates the rise of online home-sharing platforms like Airbnb and VRBO. For this community, the allowance is much more generous, limited to 30 percent of the total housing units in the community, or about 1,100.

According to an analysis by the city’s independent budget analyst based on home-sharing activity before the pandemic, the annual cap could mean 1,650 to almost 2,800 fewer listings for whole house rentals that would be allowed to operate for more than 20 days a year. This equates to a reduction of about 20-30% of these rentals. For seasonal rentals subject to the annual cap, a minimum stay of two nights will be required.

One question that remains unclear is how the limited number of short-term rental licenses will be allocated. The council has already agreed to return in October to consider a lottery system that would prioritize what it calls existing hosts “good players” who paid the required taxes and operated responsibly. Only one license per person will be allowed.

The new rules, regarding the city’s beach communities, have yet to be approved by the California Coastal Commission.

The cap will not apply to guests who rent an entire house for no more than 20 days per year. Likewise, there will be no limit for people who rent a room or two in their house while they reside there.

It is not yet clear how much it will cost to obtain short-term rental licenses. City officials expect to return to council later this year with a proposed fee package. An early version of a proposal developed by the office of Council President Jennifer Campbell suggested a cost range of as low as $ 50 for someone renting their home less than 20 days a year to $ 1,000 for those who rented their home. hosts renting out their entire house for more than 20 days a year.

The city treasurer’s office estimates an initial start-up cost of $ 1.7 million, plus ongoing costs of $ 2.4 million to administer the licensing effort.

Tuesday’s vote crowns a multi-year process that so far has failed to control the skyrocketing growth in vacation rentals. It’s been two and a half years since Airbnb and Expedia, the parent company of HomeAway and VRBO, successfully staged a referendum campaign that killed much stricter council-approved restrictions that would have banned second home rentals for stays. of short time.

The regulations approved and approved on Tuesday were born out of a compromise plan from Campbell’s office that has won backing from Airbnb and other major home-sharing platforms, as well as the local hospitality workers union. Critics of the new regulations say they remain concerned about activity they say has taken over their once peaceful neighborhoods.

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