Supervisor David Chiu’s proposed law which would lift the existing outright ban on short-term rentals in San Francisco but establish a new set of rules and disclosures by which all hosts and “Hosting Platforms,” such as Airbnb, would have to adhere, or be subject to a penalty of up to $1,000 a day, will be reviewed by San Francisco’s Planning Commission in a public hearing this week.
The proposed ordinance would allow residents who occupy a unit as a permanent residence for at least 275 days a year to offer it as a short-term rental for the other 90 days, as long as it’s pre-registered with the City, occupancy taxes are paid and insurance is maintained.
While Supervisor Chiu’s proposal would exempt single-family homes and hosted rentals (where the resident is present during the guest’s stay) from the 90-day limit, San Francisco’s Planning Department is recommending that no exceptions to the 90-day limit be allowed.
In addition, the Department is recommending that the addresses of all registered short-term rentals be publicly disclosed and mapped; that any posting or advertisement for a short-term rental in San Francisco include a valid registration number or be subject to a fine; and that penalties for repeat violators be increased and enforced.
Hosting Platforms would be responsible for notifying hosts as to the applicable restrictions and requirements for registration as well as for collecting and remitting Transient Occupancy Taxes and an accounting of the number of days a property was rented. Failure to provide the required notice or accounting would subject Hosting Platforms to a fine of up to $1,000 a day per violation as well.
The proposed legislation would not supersede the terms of an existing lease or homeowners association (i.e., illegally subletting would still be grounds for eviction), and tenants in rent-controlled units would not be allowed to collect any more money than is being paid to their landlord in rent, but it would create an exception for first time violators of the standing “illegal use” clause which landlords having been using to evict tenants from rent-controlled units.
What is a “hosted rental”?
[Editor’s Note: A partial rental of a unit (suite, room, couch, etc.) where the full-time resident is present during the guest’s stay.]
Tenants should not be allowed to put their units on airbnb if their landlords doesn’t expressly agree with it, period.
Something really interesting in the fact that rent controlled tenants cannot collect more than they pay in rent, is how they will enforce it.
Will they let the landlord do the math (how will they know how much their tenant made from the various websites?), or will there be a centralized registry of rent on rent controlled units? I would LOVE to put my hand on such a registry, and compare the extreme disparity between lucky and unlucky tenants.
According to a legislative aide in Chiu’s office, they expect enforcement would be driven by complaints similar to now because the gov’t doesn’t know the rental terms and doesn’t intend to gather that information.
Hmmm… now why wouldn’t Planning/Chui just include this data point in their registry/database? It would be simple enough, one more question to answer when signing up; one more field to add to the database.
Just another example of SF policy makers running scared of tenants.
And what’s up with changing the just cause eviction rule to give tenants a 30 day warning? Are homeowners going to get a warning too?
Well, as it stands now, tenants can’t put their units on airbnb, period, whether their landlords agree or not (well, they can, but it is a criminal violation of the law).
I believe tenants can always do 30+ days rentals as long as their lease allows it. 30+ days is within the law I believe.
Less than 30 days is illegal for SF, agreed. Right now it’s “everything goes” where people will do something illegal since there’s an App for it.
Yes, that is my understanding. Easy to put a “no subletting” clause in a lease. Curiously, many years ago, I sublet a couple of places from friends who were traveling, over their landlords’ objections, because their written leases expressly permitted subletting. Likely just used some form they found. May be more common than one would think.
$1000/day per violation is pittance for airbnb
For renters, I think the landlord should have to agree and this be part of rental agreement. Otherwise , I think the tenant should be evicted for charging for a room or apt to a person not listed on the lease
UHG. I’m grateful there’s wording in our HOA agreement that precludes owners of other units in our building from going the airbnb route. Though most have been great, a couple long-term renters in the building were pretty disrespectful of the common areas (to say nothing of the units they were renting), so I can only imagine the sh!t show having owners rent their places out by the weekend would be. I do wonder whether other buildings’ HOA agreements have similar language because I see A TON of listings for full lofts & apartments on airbnb nearby us.
Beware what you see on airbnb’s map. If you look up through the map only without selecting dates, you’ll find all places that have been on airbnb at some point. Say your upstairs neighbor used it once for a week-end, they’re likely to stay there for a long time on the map even through they have no availability, and this until they’ve deleted the listing.
I advise you to make a search way in the future, like 6 months, in a quiet period. Then you’ll see what’s actually active around you.
Interesting – thanks for the tip. That halved the number, from almost 200 to about 100 listings for the “entire place” in my neighborhood, primarily in what look like condos. But even 100 still strikes me as a surprisingly large number of people willing to gamble.
It all depends on what you call “gambling”. Some of these listings are probably posted by the owners or intermediaries working for the owners. If they are tenants they deserve to be Kicked out and let someone more deserving rent the place.. Short term renting is illegal but you have very little risk today except if you have upset a neighbor. I do 30+ days, within the law, and the main risk is one guest asking to stay longer term at the inflated price by invoking the rule that a lease starts after 30 days. I would laugh all the way to the bank if that were the case…
Craigslist’s very large clerical organization is just waiting to work with Dave on this. Meanwhile until the city steps up and increases housing opportunities, everyone’s a scapegoat which allows then to never really address the housing situation. Limp, by-committee, passive no planning leads to one by one approvals instead of an aggressive visionary plan for ANY neighborhood. Octavia took 15 yrs of meetings (I was there) — and we get four tall buildings on corners like a Lego set. It only starts with Airbnb and it will not end.
8 octavia is a terrible looking building coming in from the freeway. it looks like a concrete slab in the slums of Rio
I could not disagree more
I could not disagree with you more. It is a terrible looking building. Coming off the fwy it looks like a prison.
It’s insane that they would not exempt single family homes from all airbnb legislation. It’s one thing to regulate apartment buildings that are meant to be part of the rental stock, but with SFH’s we’re talking about someone’s home. That is blatant taking of property. SFH’s aren’t even subject to rent control, why should they be subject to airbnb laws?
I think they still believe that a family making the median income of 79K should be living in your SFH, and the only reason it is not happening is because of landlord greed and punishing landlords will solve all problems…
It’s as if all the loser kids who flunked economics 101 decided to go into politics in SF to fight until numbers heed and make SF the affordable city it has never been.
SFH’s are subject to tons of laws (building codes, zoning, etc.). As it should be, and it is not a taking. One very solid rationale for not exempting SFHs is that most residential neighborhoods are not zoned for, nor appropriate for, running a hotel. Just like they are not zoned for dynamite storage, a pig farm, manufacturing, or a thousand other prohibited uses. Personally, I really don’t care about SFHs being rented out on airbnb. But it is a perfectly legitimate use of a city’s regulatory authority to prohibit this.
I generally agree. There is a process available to go through Planning and be approved to run a “B and B” out of one’s home, and that is the process that should be followed. I suspect that is how the final legislation will read.
Sorry, meant to agree with Jill below . . .
personally i think all should be outright banned. your neighbors didnt move in knowing a hotel was next door. unless the area is zone for a hotel, like maybe union square, then i dont think it should be allowed without rezoning
All laws were created under a certain context. For instance, we had to regulate the Internet. Now with content being streamed through pipes owned by cable providers we need to regulate net neutrality. Cable providers know they are losing market share to a more client-oriented business model, and they are trying to stop the revolution from happening.
I believe we need to regulate airbnb-styled businesses. SFH are less an issue than apartments but there needs to be strict guidelines for respect of your surroundings.
One idea: strongly enforce laws against noise. Immediately fine the owner for violations so that he can pass it on to the guests through the security deposit. This will make the host conscious of the issue, an the guest aware that he needs to respect the neighbors. Since airbnb is a review-based system, there could be some friction that people want to avoid, but if it comes from the City itself then people will not go at each other and accept they broke the rules.
JR, interesting issue. Are SFH cutting into the hotel business?
I do not think that many people who rent a SFH on airbnb would go to a hotel if airbnb went away overnight.
Yes airbnb probably cuts into hotel revenue in some tourist areas. But there’s a whole new use that was subdued before technology expanded the possibilities: home exchanges. In the old model, you’d go on craigslist.org and search for unlikely matches. It’s more personal, maybe a bit scary for some. Today you give your place for money and you use this money to go where you want to go. If anything, it’s the exploitation of an untapped resource thanks to technology. Think of it as coal exploration before we had ways to bring people and materials to greater depths. An added benefit for airbnb: people will pay taxes on the income, which cannot happen for old-styled home exchanges.
Wholeheartedly agree that the new sources of information are great. I’ve used VRBO and airbnb many times when traveling (France, England, Japan, Italy, all over the U.S.). Anecdotally, in nearly every case, if these weren’t available, I’d have gotten a hotel room. But I couldn’t tell you if these cut into hotel rates on a macro level.
But my point above was a zoning issue – not an issue of economic efficiency. What if 3 out of 4 SFHs on a block vacated and just rented out to tourists full time? A problem? Many would think so. Yes, this is a “parade of horribles,” slippery-slope and all that. My point above was that it is certainly a credible and legitimate position to ban SFHs in a residentially-zoned area from being used commercially as a tourist hotel.
(Here is another extreme example – if I rented every room in my house by the hour through an app to hookers or to addicts looking to shoot up, I’d make a mint. Very economically efficient and far superior to the ad hoc addict/hooker-in-the-alley status quo. But I suspect my neighbors would not be happy at all about this. Legitimately so. Not a “taking” to prohibit such a use).
airbnb cannot really be compared with organized prostitution, dynamite storage or pig farms…
It is merely an expansion of an already existing business model which is providing regular housing to humans for financial compensation. Yes existing zoning prevents some of the current airbnb uses. Yes some cities will forbid some of of this airbnb-related activity. But we are not talking about crimes against humanity there. All proportions should be respected. We need regulation. We need enforcement of laws protecting neighbors. Tenants should NOT become landlords as long as he landlord hasn’t agreed to it. But that’s the extent of what we need to do I think.
I think a pig farm is a pretty good analogy
Tourist hotel rentals are not the same as (or an extension of) monthly residential leases. Very different animals. We could draw up some regulatory structure based on noise, annoyance to neighbors, etc. I agree. But that would be a hot mess. Much cleaner and more sensible to just leave commercial tourist uses to commercially-zoned districts, I think. I certainly see both sides to this one.
Regardless, the hourly prostitution analogy is pretty apt — pretty sure there is a fair amount of sexual activity in most SF homes. Difference is in degree more than kind.
The difference is less and less obvious. For instance I am spending now less than 60% of my time in my main residence. The rest is taking care / enjoying 2nd and 3rd home as well as spending time in other people’s houses and even hotels. The world is changing fast. My work moves with me and this means my life can be anywhere I want it to be. I don’t think I am the only one in that case. Many of my corporate airbnb guests are mobile and have lived in at least 2 cities in the past few years.
I applaud Chiu for starting this and I applaud SF Planning Dept for adding their recommendations – which I totally approve of – esp the SFH and the mapping.
Why shouldn’t SFH’s be part of this as well? I want them to be available (up to 90 days) and I also want them NOT to turn into full time airbnb (like someone said, they can turn themselves into a B&B if they want to do that).
Also, the mapping is critical..if I am a home buyer or renter, I want to know if I am buying or renting next door to an Airbnb unit…or how much of my block is doing that. I KNOW that the VRBO folks are pissed about that one as they have always been able to fly under the radar and this would bring them back up. Expect this point to be a battle (but again, if you don’t want to have your place mapped, then just DON’T be in the business!).
Lastly, one thing I am curious about: what about In-laws (legal or unlegal) that are part of a SFH??
There’s an almost direct connection between rental laws in SF and the number of airbnb offerings.
What I feel: here are 2 kinds of people who would want to transform their place into a permanent airbnb place:
1 – renters who want to collect the difference between what they pay and what they collect. They are very unlikely to pay market rate. Why would anyone rent a 1/1 for 3200 in a good area to sublet it for $160/night? It doesn’t make sense. After taxes, etc, you’re not making any money. Nope, they are likely to pay much less than market rate. These are rent controlled tenants making an (easy) buck.
2 – Landlords who will furnish their place and rent it out outside of a regular lease. The goal there is obvious: get around rent control laws. They’re not likely to make much more money than with regular rentals, for the same reasons as #1. But for them keeping control is more important than the extra buck.
In short, without rent control you’d see way less people offering their place on airbnb.
Chiu’s legislation is BS. First, you can only airbnb the unit you reside in. LL’s with multi units, fugrtaboutit. So that blows. Second, who wants to register all their info with this stupid city? I sure as hell don’t.
Forget this bureaucratic nightmare. Airbnb is trying to do something that would most likely be better, without having to register with the city.
Sign their petition! http://sf.fairtoshare.org/sign_the_petition
Despite claims and concerns, the scenario by which even 25% of residential units are converted to part-time rentals has an extremely small chance of occurring. There simply isn’t the demand to sustain that level of occupancy at a rate that potential hosts would be willing to accept. The total number of units available appears to be far less than 1% of the city’s total. Included in the current listings, btw, are listings for regular small-scale hotels and B&Bs.
In some neighborhoods like Union Square, the Financial District, Fisherman’s Wharf and SOMA near Moscone, the demand will be higher. There, there will be overflow demand from hotels and a larger potential market. (Even then, a quick check shows unrented units for Wed/Thursday of this week)
I’m going to start a ballot campaign to eviscerate Bierman’s law banning rentals for less than 30 days in all residential buildings in the city. My law will be simple. Strike the language from the SF rent stabilization ordinance that bans all rentals of units or rooms in the city for less than 30 days.
Let the ballot wars begin!!!!
Screw BIG government.
Are you actually going to do this, or are you just blowing smoke? I was part of a group that put an initiative on the ballot successfully and it was a lot of work. It took about a dozen of us working every weekend for two months to get the signatures. You can pay for signature gatherers but that costs about $20,000 just to get on the ballot.
As an SF homeowner, the ridiculous rental situation here turns me off from offering up spare space in my home for rent in spite of the crazy amount I would get for it. So that space goes wasted, one less unit of housing.
I’m very attracted to airbnb to allow someone to get some value out of my space, and for me to be compensated. Hooray free market. However much it would eat into my profit, I think we should regulate airbnb in some way.
Hotels are regulated for a reason (as has been pointed out earlier). It’s also unsustainable to allow both regulated and unregulated participants in the same market – it’s completely unfair and distorts the outcome. And before you say boo hoo hotels, learn to compete .. I don’t think you’ll like the future that creates. We should have regulation for all BUT it should be sane, please. As a single person operating a short term rental out of my home I think some modest fees and paperwork is proportional burden. I doubt whatever SF comes up with will be sane.
Gee Ess, you could do 30+ days, corporate rental. It’s less work than tourist airbnb, plus it’s legal 😉
About Hotels, times change. Hotels for mass tourism are not something very ancient, way less than 100 years old. In the 19th century hotels would be split between single quarters for workers, furnished hotels for new families, luxurious hotels for people making their Grand Tour. Most of these uses are all but gone.
Today visitor tastes are evolving, rapidly splitting between different needs: mass tourism, eco-tourism, urban-tourism. Airbnb helps to accommodate some of these new needs. Hotels are still relevant, but need to look very closely at this issue.
Would the 30+ day corporate tenant be entitled to assume lease after 30 days?
Yes, this would be an issue. But, if you are charging corporate rental rates you are getting substantially more than today’s high rents. Only someone like Maksym would try to invoke tenant rules and pay (or not) the very high corporate rental rates.
30 days+ = tenant in CA. Think twice!
SanFonzi- I have a couple of great guys who’d love to rent 30+ days from you. Maksym and Denys Pashanin. Europeans too….wheeee!
UPDATE: Framework To Legalize, But Limit, Airbnb-ing In SF Approved.