Why this matters
How to fix San Diego’s housing shortage is a problem that has dogged city leaders for years.
San Diego officials are considering a fee for those who stay in short-term rentals.
On Thursday, a committee voted unanimously to update a study that examines the link between vacation rentals and affordable housing needs — part of a long debate about whether platforms like Airbnb and Vrbo suck up the housing stock and raise costs. The study would recommend nightly fees.
“This is an opportunity to provide stable funding that would support our ongoing efforts to address our housing crisis,” said Councilmember Kent Lee, who serves as chair of the Land Use and Housing Committee.
Previously conducted in 2018, the study looked at the connection between visitor spending from short-term rentals and the need for affordable housing for low-wage workers — such as cleaners, maintenance, hosts, cashiers and dishwashers — and recommended various impact fees to consider.
Council members at the time decided to charge nightly fees of $2.73 for home shares and $3.96 for whole home rentals — projecting the fees could raise roughly $2.9 million every year to support affordable housing developments. After facing a polarizing debate where opponents pushed a repeal, the City Council scrapped its short-term rental ordinance and the fees were never implemented.
A new law regulating short-term rentals took effect in May 2023. Officials are now revisiting the idea of charging fees.
“We have a ready-made solution to help create more affordable homes, but it was put on ice years ago — and I want to bring it back to life,” Lee said in a statement to inewsource. “Updating this study is the first step toward putting this tool into action, providing an opportunity to identify a long-term, sustainable source of funding for affordable housing.”
City staff anticipates returning in a few months with an updated study, which will cost at most $90,000, and a new fee recommendation. Any new fees would have to be approved by the full City Council.
The San Diego region, like many other communities across the state, is grappling with a housing and affordability crisis that experts say is driven largely by underproduction. A regional housing study projected San Diego will need more than 13,500 housing units every year to meet the demand of all income levels by the end of the decade. Last year, the city only authorized construction on a third of that.
Craig Benedetto, a lobbyist for Airbnb, told committee members the city already collects more than $35 million in local taxes from short-term rentals. He urged them to consider potential impacts that might discourage visitors.
“Additionally, according to independent research,” Benedetto added, “Airbnb has had an extremely small impact, and in many cases no impact at all on rental cost increases.”
Councilmember Sean Elo-Rivera pushed back, saying, “Tourism should work for San Diegans and not the other way around.”
“I recognize that Airbnb is not the cause of the housing shortage, but if it’s having an impact, it’s having an impact,” Elo-Rivera said. “And if we all agree that there’s some real supply and demand issues that are impacting the cost of housing, and Airbnb or short-term vacation rentals are part of what is chewing up that supply, it’s part of the problem.”
Type of Content
News: Based on facts, either observed and verified directly by the reporter, or reported and verified from knowledgeable sources.
