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

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

San Francisco County has some of the most stringent short-term rental regulations in California. To legally operate a short-term rental (stays less than 30 days) in San Francisco, hosts must meet several requirements and obtain the necessary permits. Here's what you need to know:

Starting a Short-Term Rental Business in San Francisco County

To start a short-term rental business in San Francisco, you must:

• Be the permanent resident of the unit you wish to rent. You must spend at least 275 nights per year in the unit and can only rent it for up to 90 un-hosted nights annually. You may only register the specific unit in which you reside, even if you own a multi-unit building.
• Register with the City of San Francisco as a business and obtain a Short-Term Residential Rental Certificate. You must obtain a Business Registration Certificate from the San Francisco Office of the Treasurer & Tax Collector and a Short-Term Residential Rental Certificate from the Office of Short-Term Rentals. The application fee for the Short-Term Residential Rental Certificate is $250 and is good for two years.
• Display your registration number on all listings. Once registered, you must post your Short-Term Residential Rental Certificate number on all listings advertising your short-term rental.

It's important to note that if your application is rejected, suspended, or revoked, you must cancel any pending reservations and remove any online listings offering stays less than 30 days, even if you plan to file an appeal. Failure to comply can result in penalties of $484 per day per unit.

Airbnb and VRBO both have processes in place to help hosts comply with San Francisco's regulations. Hosts must complete the platforms' online registration process or provide a valid certificate number and expiration date for each property they wish to list.

As of 2024, short-term rental hosts in San Francisco are also required to collect a Tourism Improvement District (TID) fee from guests, which can be passed on to them at the time of booking. Hosts booking outside of the major platforms must file and pay the TID fee annually starting in 2025.

San Francisco's strict short-term rental laws aim to protect the city's housing stock and preserve neighborhood character. By carefully following the registration process and operating within the regulations, hosts can legally share their homes with visitors while being good neighbors. The Office of Short-Term Rentals provides a helpful starter kit and can answer questions to guide hosts through the process.

Short-Term Rental Licensing Requirements in San Francisco County

To legally operate a short-term rental in San Francisco County, hosts must meet the following requirements according to the San Francisco Office of Short-Term Rentals (OSTR):

1. Be the permanent resident of the unit. Hosts must reside in the unit for at least 275 nights per year and can only rent it for up to 90 un-hosted nights annually. If the property has multiple units, only the specific unit the host resides in may be registered for short-term rentals.
2. Register with the City of San Francisco. Hosts must obtain a Business Registration Certificate from the San Francisco Office of the Treasurer & Tax Collector and a Short-Term Residential Rental Certificate from the OSTR. The non-refundable application fee is $250 and the certificate is valid for two years.
3. Provide required documentation. When applying, hosts must submit proof of primary residency, liability insurance coverage of at least $500,000, and compliance with tax requirements.
4. Display the OSTR certificate number on all listings. Once approved, the host must include their certificate number on any listings advertising the short-term rental.
5. Submit quarterly reports. Hosts must provide the OSTR with details on rental activity every quarter.

Applications can be submitted online through the OSTR website. The office has a current processing time of 6-8 weeks and a 40% denial rate. Incomplete applications will not be reviewed.

Failure to register or comply with short-term rental regulations can result in penalties of $484 per day per unit. Even if a host plans to appeal a rejected application or revoked certificate, they must cancel pending reservations and remove online listings in the meantime. Hosting platforms like Airbnb are also required to verify that San Francisco listings are registered with the OSTR before allowing bookings.

By carefully following the licensing process and operating within the regulations, San Francisco hosts can legally share their homes with visitors. However, certain types of properties, including below-market-rate units, student housing, and buildings with previous Ellis Act evictions are never eligible for short-term rentals. Prospective hosts should review the full requirements on the OSTR website before applying.

Required Documents for San Francisco County Short-Term Rentals

To apply for a Short-Term Residential Rental Certificate in San Francisco County, hosts must provide the following documents according to the San Francisco Office of Short-Term Rentals (OSTR):

Proof of Primary Residency: Hosts must submit at least two of the following documents to prove they reside in the unit for at least 275 nights per year:

1. Driver's license or state-issued ID card
2. Voter registration card
3. Utility bill (gas, electric, water, garbage, etc.)
4. Homeowner's or renter's insurance policy
5. Property tax statement
6. Deed or lease agreement

Business Registration Certificate: Hosts must register their short-term rental business with the San Francisco Office of the Treasurer & Tax Collector and obtain a Business Registration Certificate. This ensures the host is properly registered to conduct business in the city.

Liability Insurance: Hosts must provide proof of liability insurance coverage of at least $500,000. This can be a stand-alone policy or coverage provided through the hosting platform (e.g., Airbnb's Host Protection Insurance). The insurance helps protect hosts in case of accidents or damages related to their short-term rental.

Affidavit of Compliance: Hosts must sign an affidavit affirming they meet all the eligibility requirements for short-term rentals, including permanent residency, insurance coverage, and compliance with building and housing standards. This sworn statement holds the host legally accountable for providing accurate information.

These documents help the OSTR verify that hosts meet the strict requirements for operating short-term rentals in San Francisco. The OSTR has up to 60 days to review and approve or deny an application once all required documents are submitted. Incomplete applications will not be processed.

Hosts must submit their application and documents through the OSTR's online portal. The non-refundable application fee of $250 can be paid by credit card, debit card, or electronic check. Once approved, the Short-Term Residential Rental Certificate is valid for two years, after which hosts must apply for renewal.

By carefully compiling the necessary documents and following the application process, San Francisco hosts can demonstrate their eligibility and commitment to operating lawful short-term rentals. The OSTR provides detailed instructions and can answer questions to help guide hosts through the requirements.

San Francisco County Short-Term Rental Taxes

Short-term rental operators in San Francisco are subject to several taxes related to their rental business. Here's a breakdown of the key taxes to be aware of:

Transient Occupancy Tax (TOT): San Francisco imposes a 14% transient occupancy tax on the rental of accommodations for stays of less than 30 days. This tax is collected by Airbnb and remitted to the city on behalf of hosts. If you host exclusively through Airbnb, you are not required to submit separate TOT filings or obtain a Certificate of Authority, as Airbnb is currently the only Qualified Website Company in San Francisco.

Business Property Tax: All property used in businesses, including short-term rental businesses, is subject to property tax unless an exemption applies. This includes furnishings such as furniture, appliances, equipment, and supplies used in the rental activity. The assessed value of business property is based on the cost of the assets, taking into account depreciation. The Assessor-Recorder's office estimates a typical assessed personal property value of $7,500 for a 1-bedroom short-term rental in San Francisco.

Business Registration Fee: Short-term rental operators must obtain a Business Registration Certificate from the San Francisco Treasurer & Tax Collector's Office. The registration fee varies based on the business's San Francisco gross receipts or payroll expenses for the current calendar year.

Possible Deductions and Write-Offs

As with any business, short-term rental operators may be able to deduct certain expenses related to their rental activity on their tax returns. These could include:

1. Mortgage interest and property taxes (for the portion of the property used for rental)
2. Utilities, such as electricity, water, and internet
3. Cleaning and maintenance costs
4. Supplies for guests, like toiletries, linens, and coffee
5. Depreciation of furniture and equipment used in the rental
6. Fees paid to hosting platforms like Airbnb
7. Insurance premiums for liability coverage

It's important to keep detailed records of all income and expenses related to your short-term rental business. Consult with a qualified tax professional to determine which deductions you may be eligible for and how to properly report your rental income and expenses.

By understanding the applicable taxes and potential deductions, San Francisco short-term rental hosts can ensure they are in compliance with local regulations and minimize their tax liability. The Office of Short-Term Rentals and the Treasurer & Tax Collector's Office provide resources to help guide hosts through the process.

California Wide Short-Term Rental Rules

While most short-term rental regulations in California are determined at the city or county level, there are a few state laws that San Francisco hosts should be aware of:

1. Definition of Short-Term Rentals: California law defines a short-term rental as a residential property or portion thereof that is rented to a guest for 30 consecutive days or less. This broad definition applies across the state, though local jurisdictions may add more specific criteria.
2. TOT Collection by Hosting Platforms: Short-term rental platforms like Airbnb are required to collect and remit applicable transient occupancy taxes (TOT) on behalf of hosts in California. However, hosts are still ultimately responsible for ensuring compliance with local tax laws.
3. Rent Control Limitations: Under the Costa-Hawkins Rental Housing Act, rent-controlled units in California generally cannot be used as short-term rentals. This statewide law applies in San Francisco, limiting the pool of eligible properties.
4. Building and Housing Standards: All short-term rentals in California must comply with state building and housing codes related to habitability, safety, and construction. This includes having working smoke detectors, carbon monoxide detectors, and fire extinguishers on the property.
5. Liability Insurance: While not legally mandated statewide, it's highly recommended that California short-term rental hosts carry liability insurance of at least $500,000 to $1,000,000. Some cities, like San Francisco, require proof of liability coverage as part of the permit process.

These statewide laws provide a baseline for short-term rental operations, but San Francisco hosts must also navigate the city's more stringent local regulations. This includes capping rentals at 90 unhosted nights per year, requiring hosts to be permanent residents, and prohibiting rentals in certain types of housing.

By understanding both state and local short-term rental rules, San Francisco hosts can ensure they operate legally and avoid potential fines or penalties. The San Francisco Office of Short-Term Rentals is a key resource for hosts looking to stay compliant in the evolving regulatory landscape.

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

San Francisco is known for its strict enforcement of short-term rental regulations compared to many other major cities. The city takes a proactive approach to ensuring compliance, with the Office of Short-Term Rentals actively monitoring listings and investigating complaints. Hosts found in violation can face significant penalties, including hefty fines and revocation of their Short-Term Residential Rental Certificate.

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 substantial risks, as non-compliance can lead to severe financial and legal consequences.

Overall, San Francisco is generally considered less accommodating to short-term rental hosts than many other cities due to its focus on housing affordability and commitment to enforcing regulations. A 2016 city report found that most short-term rental hosts were out of compliance and had not registered with the city's Office of Short-Term Rentals.

On Reddit and Bigger Pockets, San Francisco hosts express mixed feelings about the regulations. While some appreciate the need for rules to protect housing stock and ensure fair competition, others find the licensing process burdensome and the restrictions limiting. One Bigger Pockets user shared an anecdote about a friend's property being permanently blacklisted from rental activity after a city official's visit.

In conclusion, San Francisco strictly enforces its short-term rental regulations and is generally less Airbnb-friendly than other major cities. Although some hosts still operate despite the rules, they face significant risks in doing so. The majority sentiment among San Francisco hosts on forums like Reddit and Bigger Pockets is that while the regulations can be challenging, they are a necessary trade-off for operating short-term rentals in the city.

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

Starting a short-term rental business in San Francisco requires careful planning and adherence to local regulations. Here's a step-by-step guide to help you get started:

• Determine your eligibility: Review the city's requirements to ensure you qualify to operate a short-term rental. You must be the permanent resident of the unit, spending at least 275 nights per year there, and can only rent it for up to 90 unhosted nights annually. Certain types of housing, like below-market-rate units, are ineligible. Thoroughly review the eligibility criteria on the SF Planning website and contact the Office of Short-Term Rentals with any questions before proceeding.

1. Register as a business: Obtain a Business Registration Certificate from the San Francisco Office of the Treasurer & Tax Collector. When registering, use your rental property address as the business location, select "Accommodations" as the business type, and indicate that your business involves short-term rentals and transient occupancy taxes. If you already have a business registered in San Francisco, add your short-term rental as a new business location under your existing account.
2. Apply for a Short-Term Residential Rental Certificate: Submit an application to the Office of Short-Term Rentals (OSTR), including proof of permanent residency, liability insurance coverage of at least $500,000, a Business Registration Certificate, and an affidavit affirming your eligibility. Pay the non-refundable $250 application fee.
   Carefully compile all required documents before applying to avoid delays. The OSTR has a 6-8 week processing time and denies about 40% of applications.
3. Prepare your space for guests: Ensure your rental unit is clean, well-maintained, and equipped with essential amenities. Install safety features like smoke detectors, carbon monoxide detectors, and fire extinguishers. Create a welcome guide with house rules, emergency contacts, and local recommendations. Put yourself in your guests' shoes and anticipate their needs. Small touches like fresh linens, toiletries, and local snacks can enhance their experience and lead to positive reviews.
4. Create your listing: Once your OSTR certificate is approved, sign up with a hosting platform like Airbnb or VRBO. Craft a compelling listing description, take high-quality photos, and set competitive rates. Be sure to include your OSTR certificate number on your listing. Research similar listings in your area to gauge market rates and amenities. Highlight unique features of your space and neighborhood to stand out.
5. Manage your bookings and guests: Respond promptly to booking inquiries and guest questions. Provide clear check-in instructions and be available to address any issues that arise during stays. Maintain a high level of cleanliness and professionalism throughout. Use a booking management tool to automate tasks like sending confirmations and reminders. Solicit feedback from guests and address any concerns promptly to maintain a strong reputation.
6. Stay compliant and keep records: Submit quarterly reports to the OSTR detailing your rental activity. Maintain records of your bookings, income, and expenses for tax purposes. Stay current on any changes to local short-term rental regulations. Set aside time each month to review your records and ensure you're meeting all reporting requirements. Consider working with a tax professional familiar with short-term rental regulations.

By following these steps and prioritizing compliance and guest satisfaction, you can build a successful short-term rental business in San Francisco. Stay informed, adaptable, and focused on providing exceptional experiences to navigate the city's dynamic short-term rental landscape.

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

For questions about short-term rental regulations and zoning in San Francisco, the primary point of contact is the San Francisco Office of Short-Term Rentals (OSTR). You can reach them via:

• Phone: (415) 575-9179
• Email: shorttermrentals@sfgov.org
• Address: 49 South Van Ness Avenue, San Francisco, CA 94103
• Website: https://sfplanning.org/office-short-term-rentals

The OSTR is responsible for registering eligible hosts, providing information about the city's short-term rental rules, and handling enforcement. Their website offers a wealth of resources, including a starter kit for hosts, frequently asked questions, and the online application portal.

For general inquiries, you can also contact the San Francisco Planning Information Center:

• Phone: (628) 652-7526
• Email: pic@sfgov.org

In addition to official city resources, connecting with other local hosts can provide valuable insights and support. Some online communities San Francisco hosts may find useful include:

San Francisco Airbnb Hosts Forum on Facebook: A private group for Airbnb hosts to share experiences, ask questions, and stay up-to-date on local regulations.

San Francisco VRBO/HomeAway Hosts Forum on Facebook: Similar to the Airbnb group, this private forum is geared toward VRBO and HomeAway hosts in San Francisco.

San Francisco Short-Term Rental Alliance: A non-profit trade association representing short-term rental hosts and advocating for fair and effective regulations.

Bigger Pockets' San Francisco Real Estate Investing Forum: While not exclusively focused on short-term rentals, this forum is a platform for real estate investors to discuss strategies, challenges, and local market conditions.

By engaging with both official sources and peer communities, San Francisco hosts can navigate the complex regulatory landscape and connect with others facing similar challenges. As always, for specific legal or tax questions, it's best to consult with a qualified professional who specializes in short-term rental matters.

What Do Airbnb Hosts in San Francisco County on Reddit and Bigger Pockets Think about Local Regulations?

San Francisco Airbnb hosts have mixed feelings about the city's strict short-term rental regulations, according to discussions on Reddit and Bigger Pockets forums. While some appreciate the need for rules to protect housing stock and ensure fair competition, others find the licensing process burdensome and the restrictions limiting. Here are a few examples of hosts' experiences and opinions:

Reddit user u/culdesaclamort shared their experience registering as a short-term rental host in San Francisco: "Airbnb would not register my listing until the city of SF and my apartment management approved the listing. First, I had to register as a short term renter LLC... Then I had to provide documents to the Office of Short Term Rentals (OSTR) that proved it was my primary residence."

In a thread on r/AirBnBHosts, a prospective San Francisco host was advised to "Make sure you check your local laws and lease agreement, especially with San Fran and CA tenancy laws" before starting to host.

On Bigger Pockets, a San Francisco host asked for pros and cons of Airbnb vs long-term renting for a 2-story home. While no definitive answer was provided, the post highlights the considerations hosts must weigh in the city's regulatory environment.

Commenting on a post in r/sanfrancisco about Airbnb's impact on housing availability, user u/gulbronson noted "The city makes it very hard to rent out anything but your primary residence on Airbnb, and even that is limited to a certain number of days."

In 2017, Airbnb settled a lawsuit with San Francisco, agreeing to register all local hosts and ensure they are complying with the city's home-sharing rules. A post on r/sanfrancisco shared the news, with some commenters expressing skepticism about enforcement.

These examples suggest that while San Francisco hosts generally understand the rationale behind the city's short-term rental regulations, navigating the registration process and restrictions can be challenging. The strict rules have forced some hosts to adapt their strategies, such as shifting to long-term rentals. However, many continue to operate within the legal framework, recognizing it as a necessary compromise to share their homes with visitors in a city facing a severe housing crunch.

Disclaimer: While we here at BNBCalc strive to keep all of our regulation guides updated and accurate with all the latest local laws, we still do not suggest using them as your sole or primary source for local regulations. We also do not recommend you rely on the third-party sources we link to or reference, and we are not responsible for any of the information on these third-party sites. These guides are for entertainment purposes only and only provide basic information and should not be considered as legal advice.

We highly recommend directly contacting the responsible parties for each and hearing what their officials have to say. Ultimately, it's your responsibility as an investor to ensure you fully comply with the local laws, and it's best to speak with professionals before making an investment decision.