Journal

The San Diego short-term rental license, explained for buyers and sellers

Written by Zohra Azizi, CA DRE# 01992847 · Updated 2026-07-30

Whole-home short-term rentals in the City of San Diego run under a licensing system with hard caps — and the license dies at close of escrow rather than transferring with the deed. What the four tiers mean, where the caps stand right now, and what to verify before pricing rental income into an offer in Pacific Beach, La Jolla, Ocean Beach or Mission Beach.

How does San Diego's short-term rental license system work?

Short-term rentals inside the City of San Diego — any stay under one month — have required a Short-Term Residential Occupancy license since May 1, 2023, under Municipal Code chapter 5, article 10. Licenses come in four tiers: part-time (20 days a year or less), home-sharing while the host lives onsite, whole-home citywide, and whole-home Mission Beach, which has its own rules.

Two structural facts drive everything else. The license is issued to a host — a natural person, not an LLC — and one host may hold one license for one dwelling unit at a time, so an owner of several rentals needs a separate person as host for each. And the whole-home tiers are capped in number citywide, which is what makes the license a scarce asset in the beach communities rather than a formality.

Are whole-home short-term rental licenses still available in San Diego?

Tier 3 — whole-home rentals anywhere in the City of San Diego outside Mission Beach — is capped at one percent of the city’s housing stock, and the cap has not yet been reached: the City Treasurer’s table showed 4,840 licenses issued and 821 remaining as of July 17, 2026, with applications open.

The margin is the number to watch. If the cap is reached, the application period closes within 45 days and later applicants go to a waitlist ordered by a lottery held per community planning area — the Treasurer’s 2025 lottery-administration rule spells out the mechanics. A purchase premised on Tier 3 income is therefore a purchase premised on a number that moves monthly, and checking the current count is a thirty-second job on the Treasurer’s STRO page before an offer, not after.

Why is Mission Beach different for short-term rentals?

Mission Beach has its own tier in San Diego’s STRO system — Tier 4 — capped at 30 percent of the community’s housing units in recognition of its century-old vacation-rental economy, and that tier is currently closed: 1,098 licenses issued, zero remaining, with a lottery-ordered waitlist from the July–August 2025 application window.

The waitlist itself is published on the Treasurer’s site and updates as licenses become available; applications reopen for 45 days once the list runs down to 25 names. For buyers comparing Mission Beach against Pacific Beach on rental income, the tiers cut both ways: Mission Beach’s cap is proportionally thirty times more generous, but today a Pacific Beach buyer can still apply for a license and a Mission Beach buyer joins a queue.

Does a short-term rental license transfer when the house is sold?

A San Diego STRO license does not transfer with the property — the Municipal Code states that licenses are not transferable and the City will not accept any request to transfer or assign ownership or location of a license. The seller’s license is cancelled, and the buyer applies new, subject to whatever availability exists at that moment.

This is the fact that breaks deals priced on "turnkey Airbnb" listings. The workable sequence: a buyer in escrow may apply before closing by attaching ownership-transfer documentation, per the Treasurer’s FAQ — so the license application can run parallel to the transaction rather than after it. Two operating rules matter to the same math: whole-home licenses require a minimum of 90 rental days a year with quarterly reports to keep the license, and whole-home stays carry a two-night minimum. There is no tier at all for renting a non-primary home 21 to 89 days a year — the ordinance simply does not allow that pattern.

What does a San Diego short-term rental license cost to hold?

A whole-home San Diego STRO license costs $1,129 plus a $41 application fee for its two-year term at the rates effective March 1, 2025, and the operating taxes are larger: transient occupancy tax on every stay under one month at 11.75, 12.75 or 13.75 percent depending on the property’s zone, plus the city’s annual rental unit business tax.

The three-zone TOT structure dates to May 1, 2025, when Measure C took effect — the zones tier by proximity to the Convention Center, and the city publishes a lookup map. Home-sharing tiers cost less to license ($33 application, $193–$284 license) and carry no caps. Renewal is not automatic protection: the license runs two years from issuance, the renewal notice arrives by email 60 days out, and a missed expiration date means reapplying from zero — against whatever remains of the cap at that point.

Which neighborhoods does the San Diego STRO ordinance actually cover?

The STRO ordinance applies only inside City of San Diego limits — which includes La Jolla, Pacific Beach, Mission Beach, Ocean Beach, North Park, Hillcrest and Downtown — while every neighboring city runs its own separate short-term rental rules: Chula Vista, Del Mar, Encinitas, Oceanside and Carlsbad each license under their own ordinances.

So the first question about any "San Diego" short-term rental is which jurisdiction the parcel actually sits in — Del Mar’s own ordinance, for instance, was certified by the Coastal Commission in February 2026 with a citywide cap of 129 permits. One more date worth knowing inside the city: the tier-and-cap rules sunset in the Coastal Overlay Zone on January 1, 2030, unless amended or extended — meaning the coastal rules get renegotiated with the Coastal Commission before then. A license strategy with a horizon past 2030 should watch that docket.

License counts, fees and tax rates above are from the Office of the City Treasurer’s STRO pages and the San Diego Municipal Code as of July 2026. Counts change as licenses issue and expire, and the caps recalculate every two years — confirm current availability with the City Treasurer’s STRO program before relying on it in a transaction.

Published 2026-07-30