What’s the deal with Airbnb in San Diego? I’m confused

[Ellis Hammond]

As a owner of an Airbnb and a potential investor in more Airbnb properties, I’m trying to figure out what the heck is going on in San Diego. Rent control, appeals, new bills... what is actually going on and when will we know if it’s here to stay or not? Can someone help shed some light? Cheers

[Justin R.]

@Ellis Hammond They're free to operate ... for now.  

The current City Attorney has issued an opinion saying that current ordinance prohibits them in all zones, but the Mayor's office has decided to hold off enforcing that until more comprehensive rules can be drafted.

Last year, the City Council passed an ordinance essentially banning STRs operated by investors.  AirBnB and Homeaway (and local investors and related businesses) gathered enough signatures to put a repeal of those ordinances on a future ballot.  Instead of accepting the petition, the Council rescinded the ordinance and is trying to come up with a compromise.

It's going to come up again, most likely after the 1 year time period after the ordinance rescission - expect some new, slightly more investor friendly compromise ordinance after Oct of this year.

The rest is just personal conjecture, but I've attended some of the meetings and think the people living in the neighborhoods will eventually get relief in the form of limits on STRs. I'd bet money there will be a license fee and code compliance program. There will probably be some limit that prevents companies or out of town individuals from owning STRs, and probably limits local investors to 1 or 2 STR properties. I expect people running STRs as a business to come up with the short straw when it's said and done. The reason I say this is that both sides claim to be fighting for the little guy and against greedy business people ... and there's a real issue with shrinking rental housing stock and political will to solve housing affordability - it doesn't take much to see which way the river's running.

The problem is really just in the beach areas from everything I've seen.

I wouldn't personally invest in STRs as a business model as I look to the future. But, if it works as a long term rental and works even better as an STR, then why not?