Lakewood Short Term Rental Regulation: A Guide For Airbnb Hosts

Starting a Short Term Rental Business in Lakewood

Lakewood, California has implemented strict regulations for short-term rentals (STRs) like Airbnb and VRBO. Effective May 25, 2023, the city banned non-owner occupied whole home rentals for less than 30 days through Ordinance 2023-2. 1 However, owner-occupied "home-share" rentals where the property owner remains on-site during the guest stay are still permitted with certain restrictions.

To start a legal short-term rental business in Lakewood as a home-share host, you must follow these key steps:

• Ensure Owner-Occupancy: The property you wish to rent out must be your primary residence where you live for at least 275 days per year. Non-owner occupied or investment properties cannot be used for short-term rentals in Lakewood. 12
• Obtain Licenses: All short-term rentals require both a Short-Term Rental License and a Business License from the City. The STR license application process opened on May 1, 2023, and you can apply online, in-person, or by mail. 9
• Provide Required Documents: To obtain an STR license, you must submit proof of property ownership, passing home inspection report, proof of insurance, floor plan, and other documents outlined on the city's website. 3
• Pass Property Inspection: Your property must meet minimum safety and habitability standards set by the City. An inspection by a certified inspector is required as part of the licensing process. 4
• Follow Operational Rules: Permitted home-share rentals have rules like a maximum of 90 rental nights per year, on-site parking for guests, compliance with building/municipal codes, and registration/payment of transient occupancy taxes. 2
• Renew Annually: Short-term rental licenses must be renewed annually by submitting a new application and paying applicable fees.

It's important to carefully review and adhere to Lakewood's short-term rental regulations, as the City can issue significant fines starting at $1,500 for the first violation of operating an unlicensed rental. 1 Violators may face further penalties for repeated offenses.

Short Term Rental Licensing Requirement in Lakewood

To legally operate a short-term rental in Lakewood, California, hosts must obtain a Short-Term Rental License from the City Clerk's Office. The key licensing requirements include:

• The rental property must be the host's primary residence where they live for at least 275 days per year. 12
• Hosts must provide proof of property ownership or authorized long-term tenancy. 3
• The property cannot have any pending code violations or unpermitted work. 3
• A home inspection report demonstrating the property meets safety standards must be submitted. 4
• Proof of adequate liability insurance coverage for the short-term rental use is required. 3
• The license application must include a floor plan of the rental unit. 3

If the property is governed by an HOA, the host must provide the HOA's rules/covenants regarding short-term rentals. 3

Incomplete applications missing any of the required documents will not be processed or approved. 3 All complete applications are processed in the order they are received by the City.

If the short-term rental license is approved, the host will be notified via email, and the license will be provided for printing. Licenses must be renewed annually. 8Hosts must also obtain a separate Business License from Lakewood and register to pay transient occupancy taxes (hotel taxes) on the rental income. 2

Required Documents for Lakewood Short Term Rentals

To apply for a Short-Term Rental License in Lakewood, California, hosts must submit several documents along with the completed application form:

• Proof of Property Ownership: This could be a property deed, tax records or other documentation showing you own the residence. If you are not the property owner but an authorized long-term tenant, a notarized property owner authorization form is required. 3
• Proof of Primary Residency: Documents demonstrating the rental property is your primary residence where you live at least 275 days per year, such as a driver's license, utility bills, etc. 12
• Passing Home Inspection Report: A report from a certified home inspector (like ASHI) confirming the property meets all safety and habitability standards required for short-term rentals. 4
• Proof of Insurance: Documentation showing you have adequate liability insurance coverage for operating a short-term rental business on the property. 3
• Floor Plan: A detailed floor plan clearly showing the layout of the rental unit and rooms. 3
• HOA Rules/Covenants: If the property is part of an HOA, you must provide a copy of the HOA's governing rules, covenants, conditions and restrictions related to short-term rentals. 3
• Airbnb Tax Collection: Proof that Airbnb or your chosen platform is collecting and remitting sales/lodging taxes on your rental income in Lakewood. 3

The City will not accept or process any incomplete short-term rental license applications missing the required documents. Once all documents are submitted, applications are processed in the order received. 3

Lakewood Short Term Rental Taxes

Short-term rental operators in Lakewood, California are required to collect and remit two key taxes on their rental income:

• Transient Occupancy Tax (TOT) - Also called a "hotel tax",
• Sales Tax - Short-term rental hosts must also collect the local sales tax rate of 10.25% on the rental income. 5

Hosts are required to register for a Transient Occupancy Tax account and Sales Tax account with the City of Lakewood in order to properly report and remit these taxes. 11While Airbnb and some platforms do collect taxes like sales tax on the host's behalf in Lakewood, hosts are still responsible for registering, reporting and paying the transient occupancy tax themselves directly to the City. 13

Failure to properly register, collect and remit both the TOT and sales taxes can result in penalties and fines from the City. Providing proof of tax registration and collection is part of the short-term rental licensing requirements. 3

Lakewood-wide Short Term Rental Rules

In addition to the licensing and tax requirements, Lakewood has implemented several key rules that all permitted short-term rental hosts must follow:

• Rental Night Limits: For un-hosted stays where the owner is not present, rentals are limited to a maximum of 90 nights per calendar year. 2
• On-Site Parking: All guest parking must be provided on the rental property's premises. No guest street parking is allowed. 2
• Owner-Occupancy: The rental unit must be occupied by the property owner as their primary residence. 2
• Building/Code Compliance: The short-term rental property and operation must fully comply with all relevant building codes and provisions of the Lakewood Municipal Code. 2
• Rental Ratio Limits: Depending on the number of units in a building, there are limits on the percentage of units that can operate as short-term rentals. For example, in buildings with 11-50 units, only 10% may be used as STRs. 12
• Operational Permits: Short-term rentals may be prohibited or require additional permits in certain zoning districts like single-family residential (R-1) or light industrial (L-1) zones. 15
• Quiet Hours: Some jurisdictions require quiet hours when noise must be limited, typically overnight.
• Responsible Parties: Hosts must provide local contact information for a responsible party to respond to complaints or issues.
• Signage: Restrictions on advertising signage for the short-term rental.

Violating any of these rules can result in fines, penalties or revocation of the short-term rental license by the City of Lakewood. It's crucial for hosts to understand and follow all applicable local regulations.

Does Lakewood strictly enforce STR rules? Is Lakewood Airbnb friendly?

Based on discussions on platforms like Reddit and the Bigger Pockets real estate forum, Lakewood appears to be taking a strict stance on enforcing its new short-term rental regulations, especially the ban on non-owner occupied whole home rentals for under 30 days.

One Bigger Pockets user commented: "San Pedro is within the city of LA city limits. Also, it must be your personal residence and there is a cap of how many nights you rent it out per year. Most of the cities around LA are cracking down on Airbnb/short term rentals that are not owner occupied."7

Another user seeking to operate an Airbnb in Lakewood was warned: "They have been playing around for years and years with policy," suggesting the city's rules have been evolving and tightening over time to restrict short-term rentals. 7

Compared to cities like Los Angeles that still allow some non-owner occupied short-term rentals, Lakewood's new ordinance prohibiting this rental type seems to position the city on the less Airbnb-friendly side currently within the region.

However, some hosts may still choose to operate illegally in Lakewood despite the restrictions. As one source notes, "While some Reddit and Bigger Pockets posts suggest that some hosts still operate in Lakewood despite the rules, it's not recommended to do so."3 Violators face steep fines starting at $1,500 per violation under the new ordinance. 1

So while Lakewood is permitting some short-term rentals like owner-occupied home-shares, it is enforcing the new regulations strictly compared to other nearby cities. Operating an unlicensed or illegal short-term rental in Lakewood carries significant risks of penalties from the City.

How to Start a Short Term Rental Business in Lakewood

To legally start a short-term rental business for home-shares in Lakewood, California, follow these steps:

• Ensure Eligibility: Verify that your property meets the requirements to operate as a permitted home-share rental, including that it is your primary residence where you live at least 275 days per year.
• Review Regulations: Carefully review Lakewood's short-term rental regulations, zoning restrictions, rental night limits, parking requirements, and tax obligations. Understand the penalties for violations.
• Obtain Licenses: Apply for both a Short-Term Rental License and Business License from the City of Lakewood. This involves submitting proof of ownership, passing a safety inspection, providing insurance documentation, and other required materials.
• Schedule Inspection: As part of the licensing process, schedule and pass the required home inspection by a certified inspector to verify compliance with safety standards.
• Register for Taxes: Register for a Transient Occupancy Tax (TOT) account and Sales Tax account with the City of Lakewood. Collect and remit all applicable taxes from guests.
• Follow Operational Rules: Comply with all rules around maximum rental nights per year, providing on-site parking for guests, maintaining your primary residency, and adhering to building/municipal codes.
• Renew Annually: Each year, renew your short-term rental license by reapplying, paying fees, and demonstrating continued compliance with the City's regulations.
• Consider Professional Help: Due to the complexity of Lakewood's regulations, hosts may want to consult legal counsel or a property manager to ensure full compliance and avoid penalties.

Attempting to operate an unlicensed or illegal short-term rental in Lakewood can result in significant fines starting at $1,500 per violation under the new ordinance, so carefully following the regulations is crucial for hosts. 1

Who to contact in Lakewood about Short Term Rental Regulations and Zoning?

If you have any questions or need to report violations related to short-term rental regulations and zoning in Lakewood, California, contact:

City of Lakewood
5050 Clark Ave.
Lakewood, CA 90712
Phone: 562-866-9771
Email: Service1@lakewoodcity.org

The City's website also has an online complaint form specifically for reporting unlicensed or illegal short-term rental operations in Lakewood. 9

For questions about obtaining the required Short-Term Rental License, you can contact:

City of Lakewood Business License Division
Phone: 562-866-9771 ext. 2622
Email: BusLic@lakewoodcity.org

The Business License Division is responsible for processing new short-term rental license applications and renewals in Lakewood. 11

For any zoning questions about where short-term rentals are permitted or prohibited based on the property's location and zoning district, contact:

City of Lakewood Planning Division
Phone: 562-866-9771 ext. 2350
Email: PlanningPermits@lakewoodcity.org

The Planning Division can provide details on zoning regulations, permitted use types, operational requirements like parking minimums, and any location-specific rules that apply to short-term rentals in Lakewood.

What do Airbnb hosts in Lakewood on Reddit and Bigger Pockets think about local regulations?

On online real estate forums and discussion platforms like Bigger Pockets and Reddit's /r/AirbnbHosts, some users have expressed frustration with Lakewood's evolving and increasingly restrictive policies towards short-term rentals:

One Bigger Pockets user commented: "They have been playing around for years and years with policy," suggesting the city has been frequently changing its short-term rental rules over time. 7Another user considering operating an Airbnb in Lakewood was warned by others: "San Pedro is within the city of LA city limits. Also, it must be your personal residence and there is a cap of how many nights you rent it out per year. Most of the cities around LA are cracking down on Airbnb/short term rentals that are not owner occupied."7

This points to some hosts viewing Lakewood's new owner-occupancy requirement and ban on non-owner occupied rentals under 30 days as overly restrictive compared to policies in nearby cities like Los Angeles.However, other sources note that despite the strict regulations, "some hosts still operate in Lakewood despite the rules, as indicated by various sources." But they caution that "violating the city's short-term rental rules can result in fines."3

So while there is some frustration among hosts about Lakewood's regulatory environment for short-term rentals, particularly the owner-occupancy and rental night caps, some still choose to operate illegally despite the risks of penalties from the City.

Responsible hosts seem to acknowledge that Lakewood is enforcing its new ordinance strictly compared to other nearby cities. As one commenter put it, "Most of the cities around LA are cracking down on Airbnb/short term rentals that are not owner occupied."7 Complying with Lakewood's regulations is crucial to avoid fines and penalties.