Airbnb Short Term Rentals

The Los Angeles Short Term Rental Airbnb Laws

The Short Term Rental Conundrum

Utilizing your property for Short Term Rentals (STRs) such as Airbnb has proven profitable for some, but it is certainly not for everyone. Recent data from the LA Times reveals that the average daily rental cost in 2019 was $152, compared to this year where it has surged to $244. According to Airbnb, LA hosts earned a combined $375 Million in 2022. The reduced availability of listings played a role in driving STR revenue, dropping from nearly 17,000 listings in 2019 to just over 7,000 now. The rules around operating Short Term Rentals in the City of LA are robust. Below is a breakdown as of Sep 2023:

Utilizing Airbnb in the City of LA:
The Rules You Should Know

  • If hosting for 30 days or more:  No need to register to publish your listing.
  • If hosting for 1 to 29 days:  You must obtain a home-sharing permit from the City of Los Angeles.
  • Registration Eligibility:  Only primary residences are eligible.  ADUs must have a certificate of occupancy issued before January 1, 2017.  
  • Who is Ineligible:  Primary residences that are rental units subject to affordable housing covenants, rent stabilization, and/or income restricted under City, State or Federal law are ineligible to register.
  • If You Are a Renter: If you are renting your primary residence, you need to provide an affidavit signed by yourself and the property owner/landlord that approves you to host short-term rentals. 
  • Taxes Incurred:  14% transient occupancy tax for stays of 30 nights or less. Airbnb collects and remits City tax.  Hosts must file monthly returns for tax deductions.  County transient occupancy tax applies to unincorporated areas but is not collected by Airbnb.

The Effects of STRs

  • Less Long Term Rentals Available:  Many critics argue that Short Term Rentals remove units from the market thereby leading to more regular renters fighting over fewer units, which in turn would lead to higher rents – ultimately good for traditional landlords.  
  • Neighbors Chime In: Some argue that living next door to a short-term vacation rental can range from mildly concerning to completely life altering. Visitors usually rent the accommodation only for a couple of days, and thus neighbors often complain about trash, parking issues and noise disturbance.
  • Is This For You?  We often speak with owners who are considering the possibility of Short Term Rentals.  Some who have walked this path have achieved outsized returns, while others have fallen flat and do not believe it is worth the time invested.  Before you consider doing so, it is important that you know the rules in LA, in addition to understanding the time, effort and effects of your decision.