20 Replies Latest reply: May 4, 2013 1:11 PM by mudstump RSS

    crackdown in los angeles on vacation rentals - they call you a hotel

    New Member

      i have a condo in west hollywood which i have been renting out as a vaction property and quite successfully for two years.  recently, i received a notice from the city to stop renting it out for less than 30 days.  i also had to pay a roughly $368 "research fee", to pay the city for the time they took to print out a copy of my home away listing and the reviews (people loved the space... by the way!) and to then send me their notice to stop.  my note was from building department.  they said it's illegal in los angeles to do a vacation rental because that is the same as running a hotel.  (really?!  since when?!)


      i then saw on another site, airbnb, that a los angeles host who rented out her second bedroom also received a note from the city -- but this was from the office of finance, who demanded that within 10 days she pay 14% occupancy tax on the rentals she had.


      my neighbor also rent out space in his 2br condo, and he's always been busy with great renters and very happy guests.


      has anyone else in the los angeles area received similar notices?  what can we do to band together and tackle this?  my guests have always been happy AND they've spent literally tens of thousands of dollars in the city shopping, eating, renting cars etc.  one couple even bought a neighboring condo.


      home away says these efforts are most effective when started on a grass roots level (kind of like occupy wall street!).  but i'd be grateful and interested to hear if others have are having similar experiences and problems....!



        • Re: crackdown in los angeles on vacation rentals - they call you a hotel
          New Member

          In my little city, vacation rentals have to go through a conditional use permit process which has various requirements including owner or manager living on site and adequate parking just to name a few.  After meeting all the requirements and paying the substantial fees (ours is about $900), the owner can apply for and buy an annual business liscence and then open for business. We also collect a tax for both our city and state and pay this quarterly.  This information is available to anyone on our city website. Operating a vacation rental business legitimately takes time, money and honesty.  Some owners im my town do not go through this process creating an unfair advantage over those that do. Eventually the city catches up with them and they are required to play by the same rules as their neighbors and friends as well as suffer penalties. I would suggest to anyone that they find out what their city/state requirements are to operate a traveler's accomodation first as part of their business plan so they do not find out the hard way later on.

          • Re: crackdown in los angeles on vacation rentals - they call you a hotel
            harborfields Active Contributor

            To the OP: did you review the city's zoning ordinances (or other ordinances as applicable) before starting your vacation rental business to ensure compliance; are you registered with the city as a business;  are you paying the occupancy tax on your rentals?


            erla is right.

            • Re: crackdown in los angeles on vacation rentals - they call you a hotel
              New Member

              How many tax dollars will be lost if they shut down VRs? Foreclosed properties don't pay tax. But that's just common sense and I'm preaching to the converted. I think you need to think about who's really behind the crack down, Hotels! If I'm the CEO of a hotel chain I'm pressuring, bribing and begging my congressman to shut down VRs. I think JE is on to something. We need a nation wide organization to represent us.

              • Re: crackdown in los angeles on vacation rentals - they call you a hotel
                New Member

                Thanks for this note, peacelove+ groovy.  I am trying to find out the exact same information.  We have three vacation rentals units.  The one in Marina del Rey is a single-family home that we bought a year ago and are renting out short term very successfuly and happily. But a very petulant neighbor says she is going to  complain to the City, though she has no logical grounds for doing so  other than simply that we're renting out the house short-term (she's claimed "noise" which our next door neighbor will testify has NOT happened, but what can you do?).


                If nbecessary, we will be hpapy to get a business permit for the city of LA and pay the 14% vagrant occupancy tax the city Finance Department apparently requires.  I've called the Small Business Administration to have them research this, which they said they are doing today.  But my question is:  Can these neighbors harass us further with no cause?  Since this is a single-family and there is no rent control, we didn't realize we are doing anything "illegal," but give the amount of publicity on the City about to crack down on short term rentals, we feel it's definitely preferable that we do everything "legit" as soon as possible.


                Does any one out there know the rules and regulations for vacation rentals in the LA area (including Mar Vista, Venice, Marina del Rey)?  Luckily, we are not based in Santa Monica, where enforcement again short-term renters seems to be already starting.


                Hoping that some of you will respond --


                Best, J



                • Re: crackdown in los angeles on vacation rentals - they call you a hotel
                  New Member















                    • Re: crackdown in los angeles on vacation rentals - they call you a hotel
                      swlinphx Premier Contributor

                      That's awful and scary!  We had an issue here where they were considering banning vacation rentals for less than 30 days.  Is your ban for less than 30 days only or all vacation rentals??

                        • Re: crackdown in los angeles on vacation rentals - they call you a hotel
                          New Member

                          Can you scan/send to the Community the notification you received?  Right now the City of LA(which is not the same as Beverly Hills, which is an incorporated City I believe) is NOT shutting down vacation rentals (yet) but IS  trawling the vacation websites and then sending out Notices of non-compliance in paying "Transient Occupancy Tax" which is pegged at 12% of your rental income.  We and several others have had to go down to the City Finance Dept. (NOT the Housing Dept) and file for this and you are required to submit your rental amounts every month and then pay your taxes on that.  While 12% is onerous, it is not the same as shutting people down, but again, we don't know where this is all leading.  I personally believe the City of LA would be absolutely insane to shut down such a huge source of tourist income, which is why they are simply now trying to tax us -- but at least in the City of LA (which includes the Marina, Mar Vista and other beach-area communities) not shutting folks down yet.   Im personally willing to go along with paying taxes on our business, but it would be devastating to all of us if they shut these hard-working, revenue-generating businesses down. The City wants and needs the tax money more than they want to see us go away I believe.


                          We should all band together for a meeting, however, because we DO need to start getting organized.  This issue will be fought in the City Council before long -- and we should have all our ducks in a row.

                      • Re: crackdown in los angeles on vacation rentals - they call you a hotel
                        New Member

                        New to this forum and site, found it because I had a property on airbnb and there too, property owners are running into issues  -- even ultimatums from other “users”.  But here’s some info for everyone for what it’s worth, I’ve tried to look into as much as possible so I know myself.


                        “Transient occupancy”.  It’s no wonder everyone’s confused (i am still confused).  This is one side of the city of LA (dept of building + safety) saying no it’s not ok to have a vacation rental or place of transient occupancy, while another side of the city (office of finance) giving permits and saying pay transient taxes if you do it (without them commenting on the legitimacy or not of doing it).  The code to research is 12.21A.1 of Los Angeles Municipal Code.


                        If the building dept says you are running a transient occupancy place it gives you an order to comply and you have 30 days to do what they say, or be fined.  If you still don’t comply within 15 days of that end date, you may be fined a second time for non compliance.  And if you are late paying the non compliance fee they can charge you 2.5x the amount -- the fine is doubled, with a 50% collection sircharge.


                        So why is the finance department issuing transient occupancy permits and gladly taking the money (which is all good for the city... 12% tax is a very high tax), while the building department says it’s a no go?  Again, its no wonder everyone is confused. 


                        Anyway this seems to be a volatile topic. ;-(


                        And if you wonder how conflict-laden it can be, this is a note that a “host” on airbnb sent to numerous hosts.  My wife and I live 3 miles away from him so he is hardly a neighbor, but he clearly trolled the site and sent this.  Two other locals I know with vacation properties also received the same email from him, they were all sent on the same Sunday afternoon.  We know because we compared notes.






                        1 Guest


                        Purpose of trip business

                        I need to politely notify you that you need to cease using your home for commercial purposes, as a boarding house.

                        Your activities are illegal and are causing daily problems and using up our very short supply of parking and interfering with my general sense of safety and privacy up here.

                        I prefer to have you respect this polite request to cease all rentals, business activity and construction. If you choose not to comply with these requests in the next few days, I will have no recourse but to call the City Building and Safety, Zoning and Planning, notify AirBNB and take any legal action necessary to end this unfair and illegal intrusion into my neighborhood.

                        There are no licenses or City codes that exist to gain compliance in this regard: No commercial, rental or business activities are permitted in this R1 Zone residential street. What you are doing is not permitted, pure and simple. You really need to take down all advertising and cease all rental (really sub-rental) activities immediately. Running a B&B is simply not OK or legal. I might also begin to question if the income from this operation is being reported to the IRS, which is an even far more serious matter.

                        Again, if these concerns are not dealt with promptly (meaning now), I will pursue all available legal means to gain compliance. Today is your polite, friendly, considerate warning. Beyond this, city investigators and lawyers will become involved. I'm sure neither of us want to go down that path. It will turn a mere "bummer" into a major calamity.

                        Please do not test my determination to bring this to a rapid end. Swallow hard and find a way to earn extra income that does not violate the safely, security, property rights, property values and peace of mind of other.

                        W J


                        creston drive

                          • Re: crackdown in los angeles on vacation rentals - they call you a hotel
                            swlinphx Premier Contributor

                            Wow, what a terrible notice to receive.  I'm glad I'm not in that area, as we had our own legal scare where we operate as well, but it seems to be resolved to be left up to the HOA to decide.  And even then it was only a question of the legality of allowing vacation rentals for less than 30 days.


                            What are you going to do??

                            • Re: crackdown in los angeles on vacation rentals - they call you a hotel
                              New Member


                              Your post was quite a while ago but for anyone still interested, the reason for the conflict between the finance dept and building & safety in LA is that 'theoretically' you could be in the process of applying for conditional use permits and re-zoning that would make your business legit but the reality is that those options have almost zero chance of success. Mainly for the reasons that others have already cited - the politicians who make the rules are all bought off by the hotel lobby. 


                              The truth is that they're just looking for a way to take your money for permits and taxes on something that is technically illegal because they're broke.  It's similar in concept to why medical marijuana legalization gets passed at the state level so it can be taxed even though federal law supercedes it making these laws illegal anyway.


                              It definitely helps to have Finance Dept. permits but at the end of the day, if someone turns you in to Building & Safety's zoning enforcement you can be shut down at any time.  As we just discovered, it's actually quite easy for them to do nowadays as the complaint process is all on-line. 


                              Good luck!

                            • Re: crackdown in los angeles on vacation rentals - they call you a hotel
                              New Member

                              I am an AVID supporter of AirBnb!   


                              I have traveled the world! I have slept in buses, cars, trains, parks, hotels and beautiful homes.  I know how ****** traveling can quicly turn and I know how easily it can be enjoyed.


                              Supporting travelers is listening to the basics of humanity; which thrives on trust and community; anchored in communication on a personal level.


                              All of my guests are flabbergasted by the level of kindess and attention I give to their comfort and well-being.  I love where I live in West Hollywood!  I love being a member of this community and I want to share that with as many individuals the fates will grant me!


                              I feel it is my responsibility as a person and member of the community to offer a safe, comforting and unique space for travelers.


                              I have not recieved a notice to stop hosting transient guests under 30 days. 


                              I do want to be ready.  What steps should I take?





                              • Re: crackdown in los angeles on vacation rentals - they call you a hotel
                                New Member

                                You all are unbelievable! There's laws and regulations in place for a reason. If you're going to run a business and profit then it's your responsibility to ensure you're in compliance. You can whine all you want but you get no sympathy from me. Learn how to research the rules and play by them just like the rest of us in the world.

                                • Re: crackdown in los angeles on vacation rentals - they call you a hotel

                                  My cottage is located in a very popular coastal town.  The city requires that your property is inspected every year and that you have a business license.  Your home must have windows according to code for property egress, smoke and carbon monoxide detectors, fireplace damper clamps for gas starters....on and on.  We can not rent our homes more than once in a two-week period.  We must have a local representative.  The business license and local rep info must be posted in the house.  We must provide off-street parking.  The number of cars is permitted by the city.  We must collect the names of all guests, their mailing address and phone number (during their stay) and the license plate numbers of all cars on the property.  Guest information must be given to the local rep.  Throughout the year the police chief conducts audits of owner's records to make sure you aren't breaking the municipal code.  We must also collect local and state lodging taxes and report those taxes to both each quarter.


                                  I follow the rules because I understand why local full-time residents might object to vacation rental traffic and noise.  However, I do believe that one rental in a two-week period is a bit too strict.  I like the inspection requirement as the safety of the public is very important.