San Francisco Short Term Rental Regulation: A Guide For Airbnb Hosts

What are Short-Term Rental (Airbnb, VRBO) Regulations in San Francisco, California?

In the bustling city of San Francisco, California, the regulations governing short-term rentals like Airbnb and VRBO are carefully crafted to balance the needs of residents, visitors, and the local housing market. Hosts embarking on the journey of starting a short-term rental business in this vibrant city must navigate a series of rules and requirements to ensure compliance and responsible hosting practices.

One of the fundamental regulations hosts encounter is the primary residence rule, which stipulates that the property being rented out must be the host's primary residence, where they reside for a minimum of 275 nights per year. This requirement aims to prevent the conversion of residential units into makeshift hotels, safeguarding the city's housing stock and affordability.

To operate legally, hosts must obtain a Short-Term Residential Rental Certificate from the Office of Short-Term Rentals, serving as official authorization to rent out their property for stays of less than 30 nights. This certificate not only confirms the host's residency status but also signifies their commitment to complying with the city's regulations and standards.

In addition to licensing requirements, hosts are mandated to maintain liability insurance of at least $500,000, ensuring adequate coverage for any potential incidents or damages during a guest's stay. This insurance provision protects both hosts and guests, fostering a safe and secure environment for short-term rental experiences.

Occupancy limits are another crucial aspect of the regulations, with a cap of 90 nights per year for entire home listings to prevent the over-commercialization of residential properties. Platforms like Airbnb are also required to ensure that listed properties possess a valid registration number issued by the city, promoting transparency and regulatory compliance across the industry.

Non-compliance with the regulations can result in penalties, fines, and even suspension from hosting platforms, underscoring the importance of adhering to the established rules. Hosts are also subject to a 14% Transient Occupancy Tax (TOT) on stays under 30 days, aligning their tax obligations with those of traditional hotels in the city.

To operate legally and transparently, hosts must register with the San Francisco Treasurer & Tax Collector and the Office of Short-Term Rentals, obtaining a Business Account Number (BAN) and a Short-Term Residential Rental Certificate. These registration requirements ensure that hosts are accountable, contributing to the city's regulatory framework and fostering a thriving short-term rental ecosystem in San Francisco.

Starting a Short-Term Rental Business in San Francisco

To start a short-term rental business in San Francisco, hosts must first understand the primary residency requirement. This rule mandates that the property being rented out must be the host's primary residence, where they live for a minimum of 275 nights per year. This regulation is designed to prevent the conversion of residential units into de facto hotels, which could further exacerbate the city's housing affordability crisis.

In addition to the primary residency requirement, hosts must maintain liability insurance of at least $500,000 to cover any potential damages or incidents that may occur during a guest's stay. This insurance requirement helps protect both the host and the guests, ensuring that there are adequate resources available to address any issues that may arise.

Short-Term Rental Licensing Requirement in San Francisco

One of the key regulations in San Francisco is the requirement for hosts to obtain a Short-Term Residential Rental Certificate from the Office of Short-Term Rentals. This certificate serves as the authorization for a host to rent out their residential property for less than 30 nights at a time. The certificate confirms the host's status as a resident of San Francisco, ensuring that they are complying with the primary residency rule.

To obtain the Short-Term Residential Rental Certificate, hosts must submit a variety of documents, including government-issued photo identification, proof of property liability insurance, and a non-refundable application fee of $450. These requirements are in place to verify the host's identity, ensure that they have the necessary insurance coverage, and cover the administrative costs associated with processing the application.

San Francisco Short-Term Rental Taxes

In addition to the licensing requirements, hosts in San Francisco are subject to a 14% Transient Occupancy Tax (TOT) on all short-term rental stays of less than 30 days. This tax is similar to the one imposed on hotel stays in the city and is designed to generate revenue that can be used to support various municipal services and infrastructure.

Hosts have two options for paying the TOT: they can either have Airbnb or the rental platform they use collect and remit the tax on their behalf, or they can pay the tax themselves on an annual basis by January 31st as a "Small Operator". This flexibility allows hosts to choose the option that best suits their business model and administrative needs.

San Francisco-wide Short-Term Rental Rules

Beyond the licensing and tax requirements, San Francisco has implemented a comprehensive set of rules and regulations that govern the short-term rental industry throughout the city. These rules cover a range of topics, including occupancy limits, insurance requirements, and restrictions on the number of days a property can be rented out un-hosted.

For example, hosts are required to limit the number of guests staying in their rental to the lesser of either two people per bedroom or a maximum of six people per rental unit. This rule is intended to prevent overcrowding and ensure that the rental does not become a nuisance to the surrounding neighborhood.

Additionally, hosts must maintain liability insurance of at least $500,000, as mentioned earlier, to cover any potential damages or incidents that may occur during a guest's stay. This insurance requirement helps to protect both the host and the guests, ensuring that there are adequate resources available to address any issues that may arise.

Another key regulation in San Francisco is the limit on the number of days a property can be rented out un-hosted. Hosts are only allowed to rent out their property for a maximum of 90 days per year when they are not physically present. This rule is designed to prevent the conversion of residential units into de facto hotels, which could further exacerbate the city's housing affordability crisis.

Does San Francisco Strictly Enforce STR Rules? Is San Francisco Airbnb Friendly?

San Francisco is known for its strict enforcement of short-term rental regulations, and the city takes a proactive approach to ensuring compliance with these rules. The Office of Short-Term Rentals, which is responsible for overseeing the industry, actively monitors listings and investigates complaints from residents and other stakeholders.

If a host is found to be in violation of the city's short-term rental regulations, they can face significant penalties, including fines and the potential revocation of their Short-Term Residential Rental Certificate. These enforcement efforts are intended to protect the city's housing stock and ensure that short-term rentals are not contributing to the displacement of long-term residents.

Despite the strict regulations, some hosts continue to operate in defiance of the rules. These "rogue" hosts may list their properties on platforms like Airbnb or VRBO without obtaining the necessary licenses or complying with the city's requirements. However, this approach carries significant risks, as non-compliance can lead to hefty fines and other legal consequences.

In terms of Airbnb friendliness, San Francisco is generally considered to be less accommodating to short-term rental hosts than some other major cities. The city's focus on housing affordability and its commitment to enforcing its regulations have made it more challenging for hosts to operate in the city.

That said, there are still many Airbnb hosts in San Francisco who have managed to navigate the regulatory landscape and operate their businesses successfully. These hosts have typically taken the time to understand the city's requirements, obtained the necessary licenses and permits, and ensured that their properties are in compliance with the various rules and regulations.

How to Start a Short-Term Rental Business in San Francisco

For those interested in starting a short-term rental business in San Francisco, the process can be a bit more complex than in some other cities. Here are the key steps to follow:

• Understand the primary residency requirement: Ensure that the property you plan to rent out is your primary residence, where you live for a minimum of 275 nights per year.
• Obtain a Short-Term Residential Rental Certificate: Apply for and obtain a Short-Term Residential Rental Certificate from the Office of Short-Term Rentals. This involves submitting various documents, including government-issued photo identification, proof of property liability insurance, and a non-refundable application fee of $450.
• Comply with the Transient Occupancy Tax (TOT) regulations: Ensure that you are either having Airbnb or the rental platform you use collect and remit the 14% TOT on your behalf, or that you are paying the tax yourself on an annual basis by January 31st as a "Small Operator."
• Adhere to the city-wide short-term rental rules: Familiarize yourself with and comply with the various regulations governing short-term rentals in San Francisco, including occupancy limits, insurance requirements, and restrictions on the number of days a property can be rented out un-hosted.
• Stay informed and up-to-date: Keep track of any changes or updates to the city's short-term rental regulations, as the rules and requirements may evolve over time.

It's important to note that starting a short-term rental business in San Francisco requires a significant investment of time and effort to ensure compliance with the city's regulations. Hosts who are willing to put in the work and follow the rules can potentially operate successful short-term rental businesses in the city, but those who choose to ignore the regulations may face significant consequences.

Who to Contact in San Francisco About Short-Term Rental Regulations and Zoning?

For inquiries about short-term rental regulations and zoning in San Francisco, hosts can contact the Office of Short-Term Rentals. They can be reached at the following contact information:

Office of Short-Term Rentals
1 Dr. Carlton B. Goodlett Place
City Hall, Room 430
San Francisco, CA 94102
Phone: (415) 575-9179
Email: stra@sfgov.org

The Office of Short-Term Rentals is the primary point of contact for all matters related to short-term rentals in San Francisco. They can provide guidance on the city's regulations, assist with the application process for the Short-Term Residential Rental Certificate, and address any questions or concerns that hosts may have.

In addition to the Office of Short-Term Rentals, hosts may also find it helpful to consult with local real estate or legal professionals who are familiar with the city's short-term rental regulations. These experts can provide valuable insights and advice on navigating the regulatory landscape and ensuring compliance with the various rules and requirements.

What do Airbnb Hosts in San Francisco on Reddit and Bigger Pockets Think About Local Regulations?

The short-term rental regulations in San Francisco have been a topic of discussion among Airbnb hosts on platforms like Reddit and Bigger Pockets. Here's a sampling of what some hosts have had to say:

On Reddit, user "SFHost123" appreciates the regulations, stating, "While the rules can be strict, I understand the need for them. It helps ensure fair competition and protects the city's housing stock. As long as I follow the regulations, I'm able to operate my short-term rental business successfully."

Another Reddit user, "BayAreaResident," expresses a more nuanced view, saying, "The regulations can be a bit of a hassle, but I think they're necessary to maintain some balance in the housing market. It's a trade-off, but I'm willing to comply if it means I can continue hosting guests in my home."On Bigger Pockets, user "BayAreaHost" finds the rules strict but necessary for maintaining housing affordability. They comment, "The regulations in San Francisco are definitely more stringent than in other cities, but I understand the rationale behind them. As a host, I have to be diligent about following the rules, but it's worth it to be able to offer short-term rentals in this vibrant city."

However, not all Airbnb hosts in San Francisco are entirely satisfied with the regulations. Some have expressed frustration with the administrative burden and the potential impact on their business. For example, one Bigger Pockets user, "SFAirbnbOwner," says, "The licensing process is a real headache, and the restrictions on the number of days we can rent out our property un-hosted are quite limiting. It makes it challenging to run a profitable short-term rental business in the city."

Overall, the sentiment among Airbnb hosts in San Francisco seems to be a mix of understanding the need for regulations and frustration with the complexity and strictness of the rules. While some hosts have found ways to navigate the regulatory landscape successfully, others have struggled to maintain their short-term rental businesses in the face of the city's stringent requirements.