San Diego
Can you run an Airbnb or do rental arbitrage here? What the city requires: permits, taxes, safety rules and enforcement.
Yellow light: whole-home licenses are open but capped, one per host
San Diego issues whole-home licenses outside Mission Beach under a 1% cap, and the city counted 807 left as of Sep 25, 2026, with none left in Mission Beach.[1] A license costs $1,129 plus a $41 application fee and lasts 2 years.[1] One host can hold only one license and run only one unit, so each unit needs its own host.[1]
Our verdict, based on the sources at the end of this guide.
A tenant can hold a whole-home license outside Mission Beach if the lease allows stays under a month.[1] The host must be a natural person, and one host can hold only one license, so each unit needs its own host.[1, 2] Licenses are capped at 1% of housing units, cost $1,129 for 2 years, and need at least 90 days of use a year.[1, 2] Mission Beach has no licenses left, and renting without a license is unlawful.[1]
Key requirements
One host, one license
A host must be a natural person with the legal right to occupy the unit and allow stays of less than a month.[2] A host can hold one license at a time and can't run more than one unit at a time.[2] A property manager can't be the host of several units, so each unit needs its own license and its own host.[1]
Tenants and the landlord
If you don't own the unit, you must submit a right-to-occupy document showing you can sublease for less than a month per guest stay.[1] The city's examples are a lease with a clause allowing it, a statement signed by the owner and you, or the Owner's Authorization form.[1] You also need a Business Tax Certificate, and the host must be at least 18.[4]
Whole-home license and cap
A whole-home license outside Mission Beach (Tier 3) is capped at 1% of the city's housing units outside Mission Beach, and the cap is updated every two years.[2] Licenses are issued by lottery if demand is high enough, and the application window closes within 45 days after the cap is reached.[2, 5] La Jolla, Pacific Beach and Ocean Beach are community planning areas, and every area except Mission Beach falls under Tier 3.[1, 6]
Fees and term
A Tier 3 license costs $1,129 and the application costs $41, and both are non-refundable.[1] The license lasts 2 years, and renewal costs the same, with a notice emailed 60 days before it expires.[1] Licenses can't be transferred to another host or address.[2]
Before you apply
You need an active Transient Occupancy Tax certificate, which is free, and the property's Rental Unit Business Tax account must be active and paid.[1] You also can't owe back Transient Occupancy Tax.[1] The city won't process an application for a unit with a pending enforcement action.[2]
Operational and safety standards
Minimum use and stays
Tier 3 hosts must use the license at least 90 days a year and file quarterly reports showing the days used.[2] The city's FAQ says there are no exceptions to the 90-day rule, and falling short could lead to revocation.[1] Each guest must stay at least 2 consecutive nights.[2]
Ads and signs
Put your Transient Occupancy Tax certificate number and license number on every advertisement.[2] Post an 8.5 by 11 inch notice outside, visible from the sidewalk, in all-capital black bold type of at least 20 points, with those numbers and contact details.[2] Signs promoting a business on the premises aren't allowed.[2]
Local contact and neighbors
Name a local contact who must respond to a complaint, in person or by phone, within one hour and act to resolve it.[2] Give every guest a Good Neighbor Policy notice that covers noise limits, parking, trash and the maximum number of occupants, and says noise citations can reach $1,000 for each guest and the host.[2] Update host and local contact details with the city within 30 days of a change.[7]
Safety and records
The unit must comply with the current California Fire Code, which the city can confirm by inspection or a host affidavit.[2] Post guidance for guests to report human trafficking, and keep proof that you completed a human trafficking awareness course.[2] Keep each stay's dates, nights and gross receipts for 4 years, and hand them over when the city asks.[2]
What you can't rent
The city's FAQ says accessory dwelling units can't be used for short-term rental, except permitted companion units from before Oct 15, 2017.[1] RVs, camper vans and temporary structures such as tents or sheds can't be used either.[1] The rules apply in every zone, and the unit must stay in residential use at all times.[1, 2]
Tax obligations
Registration and collection
Anyone renting a unit in San Diego for less than a month must hold a Transient Occupancy Registration Certificate and collect the tax from guests.[3] You hold the tax in trust and remit it to the city monthly, and if you fail to collect it you owe it anyway.[3] The certificate is free.[1]
Rates by zone
The city rate is 11.75%, 12.75% or 13.75% depending on which of the 3 Measure C tax zones the property sits in, effective May 1, 2025, up from 10.50%.[3] Use the city's interactive tax zone map to find a property's rate.[3] A separate 2.00% Tourism Marketing District assessment applies to lodging businesses with 70 or more rooms.[3]
Filing and penalties
Remit by the last day of the month after the rental month.[3] A late payment carries a penalty of 1% for the first late day plus one-third of 1% for each day after, up to 25%.[3] A non-refundable cleaning fee is taxable, while a fully refundable one isn't.[3]
Booking platforms
A booking platform must collect and remit the tax only if it collects rent from guests.[1] The city says how you book, whether through a property manager or an online service, doesn't change your duty to hold a Transient Occupancy Registration Certificate.[3] Platforms can't process bookings for a unit without a valid STRO license on the city registry.[1]
Business taxes
Owners who rent out a unit for more than 6 days a year owe the city's Rental Unit Business Tax.[3] If you aren't the owner, you also need a Business Tax Certificate in your name, which costs $34 a year for a business with 12 or fewer employees.[1] The Rental Unit Business Tax stays the owner's bill, but its account must be active and paid before you can apply.[1]
Enforcement
Unlicensed rentals
Renting without a license has been unlawful since May 1, 2023, and the city says it can bring a notice of violation with penalties.[1] It also says operating without a license can hurt your chances of getting one later.[1]
Warnings and appeals
The city can issue a verbal warning, a written warning, a notice of violation or a revocation, in any order.[2] You can appeal a notice of violation or a revocation by asking in writing within 10 calendar days of receiving the notice.[2] The hearing is set within 90 calendar days of your request, unless you and the city agree to a later date.[2]
Revocation
A third violation of the operating rules within 12 months can lead to revocation after a hearing.[2] Regulatory action can also follow from breaking a condition of the license, failing to fix a violation after written notice, or breaking a state or local law tied to the license.[2] After a revocation, the city won't process your application for 12 months, and it won't renew a license while a revocation is in progress.[2]
Penalties and complaints
The city's code enforcement page says civil penalties for code violations may reach $10,000 a day and $500,000 in total.[8] The ordinance says noise citations can reach $1,000 for each guest and the host.[2] Neighbors file STRO complaints through a dedicated online form, and the city won't accept anonymous requests.[8]
Law changes
California's SB 346, signed Oct 13, 2025, lets a city require platforms to report listing addresses and show license numbers, but only if the city adopts an ordinance.[9] It doesn't override a city's own short-term rental rules.[9] In the Coastal Overlay Zone, the licensing rules apply until Jan 1, 2030 unless the city amends them or the Coastal Commission extends the date.[2]
Bottom line for arbitrage
San Diego works one unit at a time, with a person as the host on each license, and only while Tier 3 stays open. Get the landlord's written OK before you sign.
Step 1 is the hard part. We find landlords who already said yes →
Sources
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