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IPFS News Link • Housing

Santa Monica to Air BnB Renters: We Will Crush You

• http://popularliberty.com

The city of Santa Monica has instituted some highly questionable new regulations that target AirBnb style rentals and are predicted to lead to a shut down of 80% of the short-term rentals within months. Forbes reports:

The Los Angeles suburb of Santa Monica has instituted the nation's toughest regulations on short-term rentals like Airbnb. Starting today, hosts will have to live on the property during the renter's stay, register for a business license and collect the city's 14 percent occupancy tax.

The city estimates that this will shut down about 1,400 of the 1,700 short-term rental listings – about 80 percent – in this upscale beach town and major tourist destination, population about 92,500.

More than just driving up rents, [Assistant Director of City Planning] Valles says, the decrease in owner- and long term renter-occupancy has the potential to change the character of the city. "It becomes more of a transient community than a neighborhood where people are invested in the community."

"Our city council thought that it was important to intervene and return rentals to the housing market," he says. Violators will face a $500 fine.

Although the new regulations ban absentee hosts, hosts are not required to be on site full time. Valles told me that hosts' work, social and personal business can go on as normal, as it would for a non-paying guest. Registration for the business license is free, and no business tax would be owed for any rental income below $40,000, though the occupancy tax would still be required.

My immediate response after reading that first paragraph was to suspect that the city's lust for new revenue sources had led to them demanding business licensing fees. However,...