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Santa Monica imposes Airbnb restrictions

The City Council of Santa Monica voted 7-0 yesterday to impose some of the toughest short-term rental regulations in California.

  • No rentals of entire units for less than 30 days.
  • Homesharing is allowed provided the resident occupant obtains a city business license and pays 14% hotel tax on rentals.

The primary issue is Airbnb accounts for around 4 to 6% of all housing units in places like Venice and Santa Monica beach cities and Hollywood, California. This reduces available housing for rent to local residents. Check out this map of Airbnb rental listings in this Los Angeles Times piece from December 2014. The loss of thousands of available rental housing units makes it harder for residents to find affordable housing.

Why is Santa Monica so popular with Airbnb?

Santa Monica is basically the beach for the city of Los Angeles and 13 million people in the LA metropolitan area. Los Angeles County beaches are a strip of land along the north coast of Los Angeles County, that runs from extremely exclusive Malibu along a narrow strip of beach where the Santa Monica Mountains meet the shoreline to the cities of Santa Monica, Venice Beach and Marina del Rey. Los Angeles Airport is south of the water channel cut at Marina Del Rey dividing Los Angeles County northern beaches from the beaches south of LAX Los Angeles Airport.

Santa Monica has about 93,000 residents and is the largest city along the north Los Angeles County coastline. Santa Monica is also the city with the most hotels. This place is a historic beach resort with the Santa Monica Pier. The pier was the western terminus of Historic Route 66.

Santa Monica Pier Route 66   Santa Monica Muscle Beach

The original location of Muscle Beach was Santa Monica by the pier. Venice Beach a few miles south is now the Muscle Beach scene and all-around scene for creative street life. Santa Monica is a bit more gentrified with historic beachfront resorts.

Hotel Casa Del Mar     Casa del Mar lobby

Hotel Casa Del Mar, Santa Monica was originally built as a beach club in 1926, and served many other functions over the decades. The hotel underwent a $50 million restoration and re-opened in 1999 as a luxury beachfront hotel in Santa Monica.

Shutters on the Beach

The same owners also have Shutters on the Beach across the street from Casa Del Mar to the north, along the beach front walkway near Santa Monica Pier. Both hotels are luxury hotel members of The Leading Hotels of the World.

The deal about Santa Monica is some 13 million residents live in the Los Angeles metropolitan area. Add that to travelers around the world arriving at LAX. Santa Monica is the primary beach destination for the LA region.

Santa Monica Hotel Lodging Scene

2-Star Hotels = 9 ($152 – $180)

3-Star Hotels = 10 ($200 – $350)

4-Star Hotels = 12 ($279 – $519)

5-Star Hotels = 2 ($550 – $670)

There are nine 2-star hotels in Santa Monica including a Days Inn, Travelodge and Comfort Inn. Rates for Friday, May 29 start at $152 for the Days Inn, $153 for the Travelodge and $179 for the Comfort Inn.

Ten hotels in the 3-star range start at Best Western Plus Gateway at $204, Wyndham Santa Monica at the Pier $319 and DoubleTree Santa Monica $349.

12 hotels in 4-Star range are priced at $279 Le Meridien Delfina Santa Monica, Loews Santa Monica Beach Hotels $398, JW Marriott Santa Monica $420, Fairmont Miramar $519.

The two 5-Star hotels are the hotels I mentioned above with photos for Casa Del Mar and Shutters on the Beach.

Airbnb swamped Santa Monica housing

The point of showing hotel rates is to drive home the point of why Santa Monica is an extremely popular Airbnb rental city.

Panoramic Ocean Views on a Budget, Santa Monica $218.50 per night for May 29-31, 2015 on Airbnb.

Airbnb Santa Monica rental May2015

This rental property gets great reviews from guests, except for the noise. It is located over a beach bar. This Airbnb rental is 60% less than the nightly hotel rate of nearby Shutters on the Beach.

Looks like this property will be regulated under the new Santa Monica city rules on short term rentals since this is listed as an entire home for rent on Airbnb.

This unit at about $160 per night for a base rental fee of $4,800 per month through Airbnb.

I wonder how much the beach bar pad can rent for as a monthly rental unit in Santa Monica to a resident?

1 Comment

  • Brent May 13, 2015

    San Diego has started to crack down on Airbnb’s in the past year. They’ve sent out letters to people renting out their rooms demanding they pay hotel taxes. The city counsel has had hearings just recently concerning Airbnb rentals. They are kicking around the idea of requiring a 14 day minimum stay and the ability to only rent out once per month.

    Airbnb is a huge business and they seem to do very little to educate their hosts on the legal issues within their city and state. Beyond that, it seems that many who rent rooms or their apartments are actually breaking their lease.. which makes me question if these hosts would actually pay the hotel taxes unless they are forced by Airbnb.

    There is a housing shortage in San Diego. There is an influx of people coming into the city and not enough housing. The cost of renting has skyrocketed in the past year or two. This is especially true for places near the beach. It will also become more and more difficult for people to rent with bad credit. I personally do not host people on Airbnb, but have met many that are hosts. I’ve found that the reason they choose to host is to rent a place that is beyond their means financially (they want a bigger place or something closer to the beach). They highly depend on Airbnb guests to help them afford their place. There is also the added wear and tear by having so many short term guests. There are a lot of apartments rented and furnished just for the sole purpose of renting them out on Airbnb. This reduces the number of available places to rent and drives up the price of rentals. If a landlord can get double the income by renting out a place on Airbnb they may want a lot more in monthly rental for long term tenants.

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