PB planner Iain Richardson, debriefing Pacific Beach Town Council in June on the number and location of short-term rentals in the community, made a case for such rentals depleting the housing stock and exacerbating the housing crisis.

But short-term rental industry spokesperson Pedro Tavares later disputed that contention, arguing instead that short-term rentals are “a poor scapegoat for the affordable housing crisis.”

“So far, nearly 7,500 short-term rental licenses have been issued in the City and 5,000 of those are whole-home rentals,” Richardson told PBTC at an in-person meeting on June 21. He concluded during his slideshow presentation that the lion’s share of STRs under the new City ordinance, which took effect May 1, are along the coast.

Noting the new Short-Term Rental Ordinance covers all residential rentals of less than one month, Richardson pointed out that, of 7,453 licenses issued by June 2, 5,066 (68%) are whole-home licenses. Graphics he provided in his in-depth analysis of PB STRs revealed 49% of all licenses are in Mission Beach, Pacific Beach, La Jolla, and Ocean Beach. A total of 80% of those licenses are in Council Districts 1, 2, and 3.

“PB has 1,076 licenses, 838 of which are whole-home licenses,” Richardson said adding those whole-home licenses are also concentrated. “In PB, 49 single property parcels have 154 (18%) of the Tier 3 licenses,” he said.

Contacted after the June 21 PBTC meeting, Tavares, a board member with the San Diego Short Term Rental Alliance, disputed the conclusion that there are an unreasonable number of STRs in PB, or that they are significantly contributing toward the housing shortage.

“The reality is that a housing crisis has been declared by San Diego’s City Council since 2002, 21 years ago and long before the terms ‘over-tourism, VRBO, or AirBnB’ was well-known or a point of contention,” said Tavares. “The City is vastly failing to produce enough housing to keep up with current and forecasted demand. Add to that the amazing amenities offered in this city, particularly in the beach communities, and it’s no wonder the cost of housing is only going to rise and will continue to do so.”

Added Tavares: “Reducing the number of short-term rentals will not bring them all to the long-term housing market and will not make a dent in rental or sale prices of units. While opponents of short-term rentals continue to beat the affordable-housing drum, they are simultaneously opposing this city’s efforts at increasing density along transit corridors, reducing parking to spur housing development, and increasing height limits to add more housing units to San Diego. The debate around short-term rentals boils down to the privileged few, lucky enough to reside in paradise, saying keep the riff-raff out.”

During his presentation, Richardson noted the City has a dedicated staff of 10 in place to manage the Short-Term Rental Ordinance program and enforcement. He added, under the terms of the Short-Term Rental Ordinance, those with noise, trash, or nuisance complaints need to reach out to the local contact required to be publicly listed by the ordinance. “Under the ordinance, local contacts must respond within one hour,” Richardson said. He added possible operating or licensing violations under the ordinance can be reported using the City’s Get-It Done app, a dedicated phone number, and an email, which are 619-533 6489, and [email protected], respectively.

Asked what conclusions might be drawn from his deep dive into the preponderance of short-term rentals in PB, Richardson replied: “The idea is that there is a real impact on the community when this much housing is taken out. These rentals are housing that is not available to them (local residents). We’re taking housing out that otherwise would be available on the local market.”

But Richardson pointed out that short-term rentals are just one element factoring into the current housing crunch. To keep up with current housing demand, he concluded, “The City needs to build about 12,000 new homes a year.” And, to highlight how far the City is falling short of that mark, Richardson noted, “In 2021, The City added 5,033 new homes including 871 ADUs (granny flats).”

SHORT-TERM RENTAL ORDINANCE FACTS & FIGURES

As of July 2022, San Diego had just under 13,000 short-term rentals, defined as a home rented out for less than 30 days, with the highest concentration located in Mission Beach.

Under the new STR Ordinance, the number of STRs will be cut in half, bringing the City’s new total to roughly 5,400 units. The ordinance will also cap the number of short-term rentals available for more than 20 days per year to 1% of the City’s housing units. There are currently over 500,000 housing units in San Diego.

Mission Beach was carved out of the STR Ordinance as the exception, given its historically high number of short-term rentals. Those rentals once were largely college students in summer. That population has been largely replaced today by out-of-town vacationers. The cap for Mission Beach under the new STRO will be 30% of available units, around 1,080 units of total inventory.

San Diego STR Tier System

There are four tiers of permits under these new rules. Under each tier, homeowners are allowed to operate only “one” short-term rental.

Tier 1 is for homes that will be rented out for less than 20 days in a calendar year. In this instance, the owner does not need to reside in the home.

Tier 2 is for home-share permits. In this situation, the homeowner occupies the home they are renting out for at least 275 days of the year. The home is their primary residence and includes duplex properties and eligible accessory dwelling units.

Tier 3 covers whole-home rentals outside of Mission Beach that are rented out for over 20 days per calendar year. In this scenario, the homeowner does not need to reside on the property. Guests are required to stay a minimum of two nights, and the total number of Tier 3 permits shall not exceed 1% of the City’s total housing units, excluding Mission Beach. The total number of Tier 3 licenses will be re-evaluated every two years.

Tier 4 is specific to whole-home Mission Beach rentals. The total number of units cannot exceed 30% of the total housing units in this area, and guests must stay a minimum of two nights.