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

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

San Francisco boasts one of the most tightly regulated short-term rental markets in the country. If you're considering jumping into the Airbnb or VRBO game in the City by the Bay, you'll need to navigate a complex web of rules designed to balance tourism opportunities with housing availability. The city's approach aims to prevent residential units from becoming de-facto hotels while still allowing residents to earn supplemental income through home-sharing.

Starting a Short-Term Rental Business in San Francisco, California

Starting a short-term rental business in San Francisco isn't as simple as snapping some photos and creating a listing. The city has established strict guidelines that must be followed to operate legally.

Primary Residence Requirement

The cornerstone of San Francisco's short-term rental regulations is the primary residence rule. You can only rent out your primary residence - the place where you actually live for at least 275 nights per year. This effectively means you must spend at least 75% of your time living in the property you want to list. The rule exists to prevent investors from converting long-term housing into vacation rentals, which could exacerbate the city's housing crisis.

Occupancy Limitations

San Francisco imposes a cap of 90 days per calendar year for un-hosted short-term rentals. This means if you're not present during the guest's stay, you can only rent your place for a maximum of 90 nights annually. However, there's no limit on the number of nights you can rent out a room or portion of your home while you're present.

Zoning Restrictions

Not all properties in San Francisco are eligible for short-term rentals. Zoning laws prohibit short-term rentals in certain zones and buildings. You can check your property's eligibility using the San Francisco Property Information Map.

Properties in RH-1(D) zoning districts face additional scrutiny. If your unit is in this zone, the OSTR will notify all property owners and residential tenants within 300 feet of your property when you submit your application. These neighbors have 45 days to submit comments, though these will only affect your application if they provide evidence that you or your unit is ineligible for short-term rentals.

Compliance and Reporting Requirements

Once registered, hosts must:

• Display their OSTR certificate number on all listings
• Submit quarterly reports detailing rental activity
• Collect and remit the 14% transient occupancy tax on all stays less than 30 days
• Maintain liability insurance or be covered by a hosting platform's insurance policy
• Adhere to the terms of private contracts, including leases and HOA agreements

Enforcement and Penalties

San Francisco takes enforcement seriously. Failure to register or comply with regulations can result in penalties of $484 per day per unit. The city has demonstrated its commitment to enforcement through high-profile cases, such as the $2.25 million settlement with landlords Darren and Valerie Lee, who operated illegal short-term rentals across 17 buildings.

In conclusion, starting a short-term rental business in San Francisco requires careful planning, thorough research, and strict adherence to regulations. While the process may seem daunting, many hosts find that the opportunity to share their homes with visitors to this iconic city makes the effort worthwhile. Just remember that the rules are designed to preserve San Francisco's housing stock and neighborhood character while still allowing residents to benefit from the sharing economy.

Short-Term Rental Licensing Requirement in San Francisco, California

Navigating San Francisco's short-term rental licensing process requires meticulous attention to detail. The city has established a comprehensive framework to regulate vacation rentals, with the Office of Short-Term Rentals (OSTR) serving as the primary regulatory authority. Here's everything you need to know about getting properly licensed in San Francisco.

Business Registration Certificate

Before you can even apply for a short-term rental certificate, you must register your business with the San Francisco Office of the Treasurer & Tax Collector. This establishes you as a legitimate business entity in the city and provides you with a Business Registration Certificate, which is a prerequisite for the short-term rental application process.

Short-Term Residential Rental Certificate

This is the primary license you'll need to operate legally. The certificate confirms your status as a San Francisco resident and authorizes you to rent your property for periods less than 30 nights. The application process includes several key requirements:

Primary Residence Verification: You must provide at least two documents proving the rental unit is your primary residence. Acceptable documents include:

1. California Driver's License or SF City ID Card
2. Vehicle Registration Card from California DMV showing your address
3. Voter Registration Card or Certificate
4. Proof of Homeowner's Tax Exemption (for single-family homes or condos)
5. Original utility bills from SFPUC, Recology, or PG&E (only one utility bill can be used)

Residency Duration Requirements: You must have lived in the unit for at least 60 days before applying and commit to living there for at least 275 nights per year.

Insurance Documentation: Proof of property liability insurance coverage of at least $500,000. If you're hosting on platforms like Airbnb or VRBO that provide this insurance, you may not need to submit separate proof.

Business Registration Certificate: Include the certificate issued by the San Francisco Office of the Treasurer & Tax Collector.

Affidavit of Compliance: A signed statement affirming that you meet all eligibility requirements.

Application Submission Process

All applications must be submitted to the Office of Short-Term Rentals. You can apply online through the OSTR's portal at the San Francisco Planning Department website. Physical copies and printouts of your documentation are not accepted - original documents must be presented.

Application Fees and Timeline

The non-refundable application fee has increased significantly in recent years. As of May 2025, the fee stands at $925, valid for two years from approval. This fee is designed to cover the operating costs of administering the city's short-term rental program.

The processing time for applications is typically 6-8 weeks, though this can vary based on application volume and completeness. The OSTR reports a denial rate of approximately 40%, underscoring the importance of ensuring your application is complete and accurate before submission.

Renewal Process

Your Short-Term Residential Rental Certificate is valid for two years, after which you must apply for renewal. The renewal process requires similar documentation to the initial application and payment of the application fee again.

Quarterly Reporting Requirements

Once certified, hosts must submit quarterly reports detailing their rental activity to the OSTR. These reports help the city monitor compliance with the 90-day cap on un-hosted rentals and ensure hosts maintain their primary residence status.

Penalties for Non-Compliance

San Francisco takes enforcement of short-term rental regulations very seriously. Operating without proper licensing can result in substantial penalties:

1. Daily Fines: Violations incur fines of at least $484 per day per dwelling unit. These fines can quickly accumulate into thousands of dollars for extended non-compliance.
2. Placement on Ineligible Host List: Persistent violators may be placed on the city's ineligible host list, which can lead to suspension from hosting platforms.
3. Additional Civil or Criminal Actions: Egregious or repeat offenders may face additional legal consequences beyond administrative penalties.
4. Mandatory Compliance: Even after paying penalties, hosts must still come into compliance with all regulations to continue operating.

The strict enforcement reflects San Francisco's commitment to preserving long-term housing stock and maintaining neighborhood character while still allowing residents to benefit from the sharing economy. By following the proper licensing procedures, hosts can avoid these costly penalties while operating their short-term rental business legally and responsibly.

Required Documents for San Francisco, California Short-Term Rentals

Successfully navigating San Francisco's short-term rental landscape requires meticulous documentation. Each required document serves a specific purpose in the city's regulatory framework, ensuring that hosts comply with local ordinances while maintaining the integrity of San Francisco's housing market.

Business Registration Certificate

This fundamental document establishes your short-term rental as a legitimate business entity within San Francisco. You must obtain this certificate from the San Francisco Office of the Treasurer & Tax Collector before applying for your short-term rental certificate. The certificate confirms your business is recognized by the city and has been assigned a Business Account Number (BAN), which you'll need for subsequent applications and tax filings.

Short-Term Residential Rental Certificate

This is the primary authorization document that permits you to rent your property for periods less than 30 nights. Issued by the Office of Short-Term Rentals, this certificate confirms your status as a San Francisco resident and verifies that you've met all eligibility requirements. The certificate is valid for two years from the date of approval and must be displayed on all your online listings.

Proof of Primary Residence (Two Documents Required)

These documents verify that the rental unit is indeed your primary residence, where you live for at least 275 nights per year. You must provide two of the following original documents (copies or printouts are not accepted):

1. California Driver's License showing the address of your rental unit
2. San Francisco City ID Card with your rental unit address
3. Vehicle Registration Card from the California DMV listing your rental unit address
4. Voter Registration Card or Certificate showing your rental unit address
5. Proof of Homeowner's Tax Exemption (only applicable for single-family homes or condominiums)
6. Original utility bill from SFPUC (water), Recology (trash), or PG&E (electricity/gas) with the payment stub showing your rental unit address (note: only one utility bill can be used as proof, and cable, cell phone, or internet bills do not qualify)

Proof of Property-Liability Insurance

This document demonstrates that you have adequate insurance coverage of at least $500,000 to protect against potential liability issues arising from guest stays. If you host exclusively on platforms like Airbnb or VRBO that provide host protection insurance, you may not need to submit separate proof. Otherwise, you'll need to obtain this coverage from an insurance provider and submit documentation with your application.

Application Fee Payment Confirmation

While not technically a document you need to prepare in advance, you'll receive confirmation of your non-refundable application fee payment. This fee covers the administrative costs of processing your application and conducting necessary verifications. As of May 2025, the fee stands at $925 for a two-year certification period.

Quarterly Reporting Documents

Once approved, you'll need to maintain quarterly reports detailing your rental activity. These reports must include:

1. Dates when the unit was rented
2. Whether you were present during each rental period
3. The hosting platform used for each booking
4. The amount paid for each stay

These reports help the city monitor compliance with the 90-day cap on unhosted rentals and ensure you maintain your primary residence status. The Office of Short-Term Rentals provides a reporting template through their online portal.

Each document in this comprehensive list serves as a critical component in San Francisco's effort to balance the economic opportunities of short-term rentals with the preservation of housing stock and neighborhood character. By meticulously preparing these documents, you demonstrate your commitment to operating within the city's regulatory framework while contributing positively to San Francisco's vibrant tourism economy.

San Francisco, California Short-Term Rental Taxes

Operating a short-term rental in San Francisco means navigating not just regulatory requirements but also a complex tax landscape. Understanding your tax obligations is crucial for maintaining compliance and maximizing profitability in this competitive market.

Transient Occupancy Tax (TOT)

The most significant tax affecting short-term rental operators in San Francisco is the Transient Occupancy Tax. The city imposes a 14% TOT on all reservations of fewer than 30 consecutive nights. This tax applies to the entire rental fee charged to guests and must be collected and remitted to the city.

Fortunately for hosts using Airbnb, the platform has been designated as a "Qualified Website Company" in San Francisco, meaning they automatically collect and remit this tax on behalf of hosts. If you list exclusively through Airbnb, you aren't required to submit separate TOT filings or obtain a Certificate of Authority. However, if you use other platforms like VRBO or direct bookings, you'll need to handle TOT collection and remittance yourself.

Business Registration Tax

As a short-term rental operator in San Francisco, you're considered a business and must pay the appropriate business taxes. The Business Registration Fee varies based on your gross receipts or payroll expenses for the calendar year. This fee must be paid annually to maintain your Business Registration Certificate, which is a prerequisite for your Short-Term Rental Certificate.

California State Rental Tax (Coming in 2025)

A significant change is on the horizon for California short-term rental operators. The Labor Force Housing Financing Act of 2023 will impose a new 15% state rental tax on all short-term rentals, effective January 1, 2025. This tax will be in addition to the existing local taxes and will apply to the rental rate charged to guests.

Federal Income Tax

All income earned from your short-term rental must be reported on your federal income tax return. How you report this income depends on several factors, including how often you rent the property and whether you provide substantial services to guests.

If you rent your property for 14 days or less during the tax year, you may qualify for the "14-Day Rule" (sometimes called the "Masters Rule"), which allows you to exclude the rental income from your tax return. However, this rule likely won't apply to most serious short-term rental operators in San Francisco.

For properties rented for more than 14 days, you'll typically report the income on Schedule E of your Form 1040 if you don't provide substantial services to guests. If you do provide services like concierge assistance, daily cleaning, or meals, you may need to report on Schedule C instead, which could subject your income to self-employment tax.

Tax Deductions and Write-offs for San Francisco STRs

Despite the tax burden, short-term rental operators can take advantage of numerous deductions to reduce their taxable income:

1. Depreciation: You can recover the cost of your property (excluding land) over 27.5 years using the Modified Accelerated Cost Recovery System (MACRS). Furnishings and appliances can often be depreciated over shorter periods.
2. Property Taxes: The property taxes you pay on your rental property are fully deductible as a business expense.
3. Mortgage Interest: Interest paid on a mortgage for your rental property is deductible. If you also use the property personally, you'll need to allocate the interest between personal and rental use.
4. Cleaning and Maintenance: Given the frequent turnover in short-term rentals, cleaning fees and maintenance costs can be substantial and are fully deductible.
5. Insurance Premiums: Property insurance, liability insurance, and any specialized short-term rental insurance are deductible expenses.
6. Utilities and Internet: Essential services like electricity, water, gas, and high-speed internet are deductible business expenses.
7. Platform Fees: Commissions and service fees charged by platforms like Airbnb and VRBO are deductible.
8. Marketing and Photography: Costs associated with promoting your rental, including professional photography, are deductible.
9. Furnishings and Supplies: Purchases of furniture, linens, kitchenware, and guest amenities can be either depreciated or deducted, depending on their cost and useful life.
10. Professional Services: Fees paid to property managers, accountants, attorneys, and other professionals are deductible.

For mixed-use properties (those used both as rentals and personal residences), expenses must be allocated based on the proportion of rental versus personal use. For example, if you rent your property for 60 days and use it personally for 30 days, you can deduct 67% (60/90) of eligible expenses.

Maintaining meticulous records of all income and expenses is essential for maximizing deductions while ensuring compliance with tax laws. Many San Francisco hosts work with tax professionals who specialize in short-term rental properties to optimize their tax strategy and avoid costly mistakes.

California Wide Short-Term Rental Rules

While San Francisco maintains its own rigorous regulatory framework for short-term rentals, hosts must also be aware of California state-level requirements that impact their operations. These statewide rules create an additional layer of compliance that affects all short-term rental operators across the Golden State, including those in San Francisco.

Housing and Fair Employment Laws

All short-term rental operators in California must comply with the state's Fair Employment and Housing Act, which prohibits discrimination based on protected characteristics including race, color, national origin, religion, sex, familial status, and disability. This means that San Francisco hosts cannot refuse guests or impose different terms or conditions based on these protected categories.

Building and Safety Codes

California's building and safety codes apply to all residential properties, including those used for short-term rentals. These include requirements for smoke detectors, carbon monoxide detectors, fire extinguishers, and other safety features. While San Francisco may have additional local requirements, these state-level safety standards establish the minimum compliance threshold.

Homeowners Associations and CC&Rs

California law recognizes the authority of Homeowners Associations (HOAs) to regulate or prohibit short-term rentals within their communities through Covenants, Conditions & Restrictions (CC&Rs). San Francisco hosts who live in properties governed by an HOA must comply with any short-term rental restrictions imposed by their association, even if their property otherwise meets all city and state requirements.

Business License Requirements

While not specific to short-term rentals, California requires all businesses operating in the state to have appropriate business licenses. San Francisco's Business Registration Certificate requirement aligns with this state-level expectation for business operations.

By understanding and adhering to both San Francisco's specific regulations and California's broader requirements, hosts can navigate the complex regulatory landscape while maintaining a successful and legally compliant short-term rental operation.

Does San Francisco, California Strictly Enforce STR Rules?

San Francisco stands as one of the most vigilant enforcers of short-term rental regulations in the United States. The city's approach to enforcement is notably more aggressive than many other major metropolitan areas, with dedicated resources and mechanisms designed to identify and penalize non-compliant operators.

The Office of Short-Term Rentals (OSTR) serves as the primary enforcement agency, actively monitoring listings across platforms and investigating complaints from residents. Their enforcement arsenal includes:

1. Daily penalties of at least $484 per dwelling unit in violation, beginning from the day a Notice of Violation is issued
2. Escalated penalties of $968 per day per dwelling unit for repeat offenders
3. Referral to the City Attorney's Office for additional civil and criminal actions in cases of egregious violations

The city's commitment to enforcement is exemplified by high-profile cases, including a $5.5 million penalty pursued against property owners operating illegal Airbnb rentals. This aggressive stance sends a clear message to potential rule-breakers about the serious financial consequences of non-compliance.

Despite the city's rigorous enforcement efforts, compliance rates have historically been problematic. A policy analysis report from 2016 revealed that nearly 80% of Airbnb hosts in San Francisco were operating without proper registration. While this data is somewhat dated, it highlights the persistent challenge of achieving widespread compliance even in a city with strong enforcement mechanisms.

The OSTR has pursued hundreds of enforcement cases since regulations were implemented, with many resulting in substantial financial penalties. What's particularly notable is that over 92% of these enforcement actions originated from resident complaints, demonstrating the community's active role in identifying illegal rentals.

Compared to other major cities, San Francisco cannot be considered Airbnb-friendly. Its regulatory framework is among the most restrictive in the nation, with multiple barriers to entry including:

1. The primary residence requirement (275 nights per year)
2. The 90-day cap on unhosted rentals
3. Extensive documentation requirements
4. High application fees ($925 for a two-year certificate)
5. Quarterly reporting obligations

Most successful long-term operators in the city have found ways to work within the regulatory framework, often by focusing on hosted stays (which have no night cap) or by maintaining multiple properties that each serve as a primary residence for different household members.

In conclusion, San Francisco maintains one of the strictest enforcement regimes for short-term rentals in the country, creating a decidedly unfriendly environment for Airbnb hosts compared to many other cities. While a significant underground market of non-compliant rentals persists, the city's dedication to enforcement means that operating outside the rules is increasingly risky and potentially financially devastating for hosts who are caught.

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

Starting a short-term rental business in San Francisco requires careful planning and strict adherence to the city's comprehensive regulatory framework. Follow these steps to establish your legal short-term rental operation in the City by the Bay.

Verify Your Primary Residence Status

Before beginning any paperwork, confirm that your property qualifies as your primary residence. San Francisco strictly requires that you live in the unit for at least 275 nights per calendar year. This means you can only be away from this residence for a maximum of 90 days annually. If you own multiple properties, you can only register the specific unit where you actually live, even in a multi-unit building you own. This requirement is non-negotiable and forms the foundation of San Francisco's short-term rental regulations.

Tip: Before investing time and money in the application process, honestly assess your living situation. If you split time between multiple residences, you'll need to commit to the 275-night requirement for your San Francisco property to qualify.

Register Your Business with the City

Obtain a Business Registration Certificate from the San Francisco Office of the Treasurer & Tax Collector. This establishes your short-term rental as a legitimate business entity within the city. When completing the online business registration, be sure to:

1. Use your rental property's physical address as the "business location"
2. Include apartment/condominium numbers if applicable
3. Select "Accommodations" as your business type
4. Indicate that your business involves short-term rentals and transient occupancy taxes
5. Never use a P.O. box as your business address

Tip: If you already have another business registered in San Francisco, you can add your short-term rental as a new business location under your existing account rather than creating an entirely new registration.

Secure Adequate Liability Insurance

San Francisco requires hosts to maintain liability insurance coverage of at least $500,000. This insurance protects both you and your guests in case of accidents or damages during stays. If you plan to list exclusively on platforms like Airbnb or VRBO that provide host protection insurance, you may be able to use their coverage to satisfy this requirement.

Tip: Even if you use a platform's insurance, consider getting your own supplemental short-term rental insurance policy. Platform coverage often has limitations and exclusions that could leave you exposed to certain risks.

Apply for a Short-Term Residential Rental Certificate

Submit an application to the Office of Short-Term Rentals (OSTR) for your Short-Term Residential Rental Certificate. This application requires:

• Your Business Registration Certificate
• Proof of primary residency (at least two documents such as driver's license, voter registration, utility bills)
• Documentation of your liability insurance coverage
• A non-refundable application fee of $925 (valid for two years)

Tip: The OSTR reports a 40% denial rate for applications, often due to incomplete documentation. Double-check all your paperwork before submission and consider scheduling a pre-application consultation with the OSTR to review your materials.

Understand the 90-Day Cap for Unhosted Rentals

San Francisco limits "unhosted" rentals (when you're not present during the guest's stay) to a maximum of 90 nights per calendar year. There's no limit on "hosted" rentals (when you're present during the stay). Develop a clear strategy for how you'll allocate your 90 unhosted nights throughout the year.

Tip: Consider focusing on hosted stays to maximize your rental income potential. Many San Francisco hosts find that offering private rooms or shared spaces while they remain on-site allows them to operate year-round without hitting the 90-day cap.

Set Up Your Quarterly Reporting System

Once certified, you must submit quarterly reports to the OSTR detailing your rental activity. These reports must include:

• Dates when the unit was rented
• Whether you were present during each rental period
• The hosting platform used for each booking
• The amount paid for each stay

Tip: Create a dedicated spreadsheet or use property management software from day one to track all this information. Retroactively compiling this data can be extremely time-consuming and prone to errors.

Register and Display Your Certificate Number

After approval, you'll receive a seven-digit registration number that must be displayed on all your online listings. Platforms like Airbnb require this number for San Francisco properties, and listings without valid registration numbers may be removed.

Tip: Take screenshots of your listings showing the registration number displayed. This documentation can be helpful if there are ever questions about your compliance.

Establish a System for Tax Collection

Ensure you have a mechanism to collect and remit the 14% Transient Occupancy Tax (TOT) on all stays shorter than 30 nights. If you list exclusively on Airbnb, the platform will automatically collect and remit this tax on your behalf. For other platforms or direct bookings, you'll need to handle this yourself.

Tip: If you're handling tax collection independently, consider building the tax into your nightly rate rather than adding it as a separate fee. This can make your listing appear more competitive in search results while ensuring you collect the required taxes.

Prepare for the Upcoming State Rental Tax

Beginning January 1, 2025, California will implement a new 15% state rental tax on all short-term rentals. Adjust your pricing strategy and financial projections to account for this significant additional tax burden.

Tip: Start communicating with potential guests about this upcoming tax change if they're booking stays that will occur after January 1, 2025. Transparency about future price increases can help manage guest expectations.

Create a Compliance Calendar

Develop a system to track important deadlines including:

• Certificate renewal (every two years)
• Quarterly reporting deadlines
• Business registration renewal
• Tax payment schedules

Tip: Set calendar reminders at least 30 days before each deadline to give yourself ample time to prepare the necessary documentation and payments. Late renewals or missed reports can result in penalties or loss of your certification.

Starting a short-term rental business in San Francisco requires significant upfront investment in time and money, but proper compliance protects you from the substantial penalties associated with unauthorized operations. By following these steps methodically and maintaining meticulous records, you can establish a successful and legally compliant short-term rental operation in one of America's most visited cities.

Who to Contact in San Francisco, California about Short-Term Rental Regulations and Zoning?

Navigating San Francisco's complex short-term rental regulations often requires direct communication with city officials and departments. Fortunately, the city has established dedicated resources to assist hosts with questions about regulations, zoning, and compliance requirements.

Office of Short-Term Rentals (OSTR)

The Office of Short-Term Rentals serves as the primary point of contact for all matters related to short-term rental operations in San Francisco. This specialized department oversees the registration process, monitors compliance, and handles enforcement of the city's short-term rental ordinances.

• Physical Address: 49 South Van Ness Avenue, San Francisco, CA 94103
• Phone Number: 628-652-7599
• Email: shorttermrentals@sfgov.org
• Website: sfplanning.org/office-short-term-rentals
• Office Hours: Monday through Friday, 8:00 AM to 5:00 PM

The OSTR staff can assist with questions regarding eligibility requirements, application procedures, quarterly reporting obligations, and compliance issues. They also provide guidance on interpreting the city's short-term rental ordinances and can clarify how specific zoning regulations might affect your property.

San Francisco Office of the Treasurer & Tax Collector

For matters related to business registration, tax collection, and remittance of the Transient Occupancy Tax, hosts should contact:

• Physical Address: City Hall, Room 140, 1 Dr. Carlton B. Goodlett Place, San Francisco, CA 94102
• Phone Number: 311 (within San Francisco) or 415-701-2311 (outside San Francisco)
• Email: treasurer.taxcollector@sfgov.org

Home Sharers Democratic Club

This local organization focuses on advocating for the interests of short-term rental hosts in San Francisco. They hold regular meetings and events where hosts can network, share experiences, and stay informed about regulatory developments.

• Email: homesharersdemclub@gmail.com
• Facebook Page: Home Sharers of San Francisco

By utilizing these official channels and community resources, hosts can ensure they receive accurate, up-to-date information about San Francisco's short-term rental regulations while also connecting with experienced operators who have successfully navigated the city's complex regulatory landscape.