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STR Laws by State · Updated July 22, 2026

California Short-Term Rental Laws: State Overview (2026)

California has no statewide short-term rental ban and no statewide STR license. Whether you can legally run an Airbnb or Vrbo here — and what it takes — is decided by your city or county. But California layers on something almost no other state has: in the coastal zone, a local government generally cannot ban or sharply restrict short-term rentals on its own, because doing so is treated as “development” under the California Coastal Act and needs the California Coastal Commission’s approval first. This page explains the statewide rules that apply everywhere in California: the coastal-zone overlay, the tax structure, an accessory-dwelling-unit trap in state law, and how the biggest markets differ.

Statewide STR ban? No — short-term rentals are regulated locally (by city and county), not banned by the state
Statewide license/permit? None — permits are issued by individual cities and counties
Governing state framework Local ordinances, plus the California Coastal Act (Pub. Resources Code § 30000 et seq.) inside the coastal zone and the Transient Occupancy Tax enabling statute (Rev. & Tax. Code § 7280)
Owner-occupancy required statewide? No — depends entirely on the local ordinance (San Diego requires it for some tiers; many cities do not)
State sales/lodging tax on STR stays None — California charges no state sales tax or state lodging tax on short-term stays; the only occupancy tax is the local TOT
Local occupancy (TOT) tax Set 100% locally under Rev. & Tax. Code § 7280; rates commonly run ~8%–15% and vary city to city
Coastal zone overlay Yes — local STR bans/restrictions in the coastal zone generally require California Coastal Commission approval (an LCP amendment or coastal development permit)
Last verified 2026-07-21

This page is a plain-language summary of public California law, not legal advice. State statutes and local ordinances change — confirm the current rules with the California Coastal Commission (in the coastal zone), the Franchise Tax Board, and your city or county before operating.

Yes. Nothing in California state law prohibits short-term rentals, and the state does not issue a statewide STR permit. California leaves licensing, zoning, and permitting to local governments — so the binding operating rules for your property come from your city (for example, San Diego’s four-tier STRO license or Los Angeles’s Home-Sharing Ordinance) or your county.

What makes California different from a state like Tennessee or Texas is not a state STR law — it’s the coastal zone. Along most of California’s ~840-mile coastline, a second layer of state authority sits on top of local zoning, and it can override a city’s attempt to ban short-term rentals outright.

The coastal zone: California’s statewide wild card

The California Coastal Act of 1976 created the coastal zone — a strip of land running the length of the state that can extend from a few hundred feet to several miles inland. Inside it, land-use decisions are governed by a Local Coastal Program (LCP) that each coastal city and county writes but the California Coastal Commission must certify. Once an LCP is certified, the local government cannot amend it — and cannot enact a new rule that conflicts with it — without the Commission’s sign-off.

Why a local STR ban can be unenforceable near the coast

Under the Coastal Act, “development” is defined broadly. Pub. Resources Code § 30106 includes within “development” a change in the intensity of use of land or water access — and courts have held that banning short-term rentals is exactly that kind of change. Because of this, a coastal city that prohibits or heavily restricts STRs is effectively amending its LCP, which under Pub. Resources Code § 30514 requires Commission certification, or is undertaking development that needs a coastal development permit under § 30600. Skip that step and the ban has, in the statute’s words, no force.

That is precisely what the Court of Appeal held in Keen v. City of Manhattan Beach (2022) 77 Cal.App.5th 142. Manhattan Beach’s zoning code had allowed short-term rentals; when the city passed ordinances banning them in the coastal zone without Coastal Commission approval, the court found the ban was an uncertified LCP amendment and enjoined the city from enforcing it. The California Supreme Court declined to review the decision, leaving it as binding authority.

The Coastal Commission’s own position reinforces this. The Commission has consistently declined to support blanket vacation-rental bans, treating them as inconsistent with the Coastal Act’s mandate to maximize public recreational access to the coast (Pub. Resources Code §§ 30210–30214) — on the theory that short-term rentals are often the only lower-cost overnight lodging available in expensive beach communities.

What this means for coastal hosts and buyers

If your property is inside the coastal zone, do not assume a city ordinance banning or capping STRs is enforceable. Check two things: (1) whether the restriction was certified by the Coastal Commission as part of, or an amendment to, the local LCP; and (2) what the certified LCP actually says. A rule that never cleared the Commission may be vulnerable — but this is a legal question, and you should confirm your specific parcel’s status with the city planning department and the Commission before relying on it. Outside the coastal zone, none of this applies and ordinary local zoning controls.

The direction of change

Coastal STR policy is actively contested in Sacramento. Legislation introduced in the 2025–26 session (for example, SB 1318) has proposed changing how the Coastal Commission must treat local limits on non-owner-occupied coastal rentals. Bills like this are introduced frequently and may or may not become law — check the current status before relying on any of them.

Do you need a permit in California?

There is no state STR permit. In practice, almost every California market that allows short-term rentals requires at least a local STR permit or registration and a local business license, plus registration to collect the local Transient Occupancy Tax. Requirements, fees, caps, and owner-occupancy rules vary widely by city — see the individual city pages for the specifics.

One statewide trap catches investors who plan to short-term rent a backyard unit: accessory dwelling units (ADUs). Under Gov. Code § 65852.2, an ADU created under the state ADU-streamlining rules must be rented for a term longer than 30 days — state law itself bars using those ADUs as sub-30-day short-term rentals, and local agencies enforce it. If your STR plan depends on a newly built ADU, confirm it is not subject to this restriction before you buy or build.

California short-term rental taxes

California’s tax picture surprises people who assume there is a “state hotel tax.” There isn’t.

No state lodging tax — TOT is 100% local

California imposes no state sales tax and no state lodging tax on short-term occupancy. The only occupancy tax is the local Transient Occupancy Tax (TOT), which cities and counties levy under the authority of Rev. & Tax. Code § 7280. Because the rate is set entirely locally, there is no uniform California figure — TOT commonly runs from roughly 8% to 15% depending on the jurisdiction (San Diego, for example, moved to zoned TOT rates starting at 11.75%). TOT applies to stays of 30 days or fewer; a stay longer than 30 continuous days is generally exempt.

Tourism and business-district assessments

Many California cities layer a Tourism Marketing/Business Improvement District assessment on top of TOT (often 1–2%), and a separate local business-license tax. These are set city by city; treat them as additional line items, not part of the TOT rate.

The 7% nonresident-withholding trap

Out-of-state owners are frequently blindsided by this one. Under Rev. & Tax. Code § 18662, a withholding agent (typically a property manager or booking intermediary) must withhold 7% of California-source rent paid to a nonresident owner once payments exceed $1,500 in a calendar year, unless the Franchise Tax Board grants a waiver or reduced rate (FTB Forms 587/588/589 and Publication 1017). Rental income from a California STR is California-source income, so a nonresident investor owes California income tax and can face this withholding regardless of where they live.

Tax / charge Who sets it Notes
State sales / lodging tax — None. California has no state occupancy tax on short-term stays
Transient Occupancy Tax (TOT) City / county (Rev. & Tax. Code § 7280) ~8%–15%, varies by jurisdiction; applies to stays of 30 days or fewer
Tourism / business-district assessment City Often ~1%–2% added on top of TOT where adopted
Business-license tax City Local; frequently required to operate an STR
Income tax + 7% nonresident withholding State (Rev. & Tax. Code § 18662) 7% withheld on California-source rent to nonresident owners over $1,500/yr, absent an FTB waiver

Pending and changing rules

California STR law moves in two places at once: local ordinances (which change constantly city by city) and Sacramento. Beyond the coastal bills noted above, measures such as SB 346 (2025–26) have addressed how platforms collect and remit the local TOT. Nothing on this page should be treated as the final word: before you rely on a coastal-zone argument, a tax threshold, or a specific local rule, confirm the current statute and your local ordinance, both of which can change between our verification dates.

Sources & verification

Every rule above is drawn from California state government sources and published court authority. Verified 2026-07-21:

Regulations change — verify with the California Coastal Commission, the Franchise Tax Board, and your city or county before operating.

Compare short-term rental rules in California cities

Frequently asked questions

Does California require a state license for Airbnb?

No. California does not issue a statewide short-term rental license or permit. You register and pay income tax with the Franchise Tax Board, but the operating permit, business license, and TOT registration come from your city or county.

Can a California coastal city ban my short-term rental?

Not easily, and not on its own. In the coastal zone, banning or sharply restricting STRs is treated as “development” under the Coastal Act (Pub. Resources Code § 30106) and generally requires California Coastal Commission approval — an LCP amendment under § 30514 or a coastal development permit under § 30600. In Keen v. City of Manhattan Beach (2022), a coastal ban adopted without that approval was held unenforceable. Outside the coastal zone, ordinary local zoning controls and a city can regulate or ban STRs.

Does California have a state hotel or lodging tax on STRs?

No. California imposes no state sales tax or state lodging tax on short-term occupancy. The only occupancy tax is the local Transient Occupancy Tax (TOT), set by each city or county under Rev. & Tax. Code § 7280, which is why rates vary so much across the state.

I live out of state. Do I owe California tax on my rental?

Yes. Rental income from a California short-term rental is California-source income, so nonresident owners owe California income tax. Under Rev. & Tax. Code § 18662, a property manager or intermediary must withhold 7% of rent paid to a nonresident owner above $1,500 per year unless the Franchise Tax Board approves a waiver or reduced rate.

Can I short-term rent an ADU (granny flat) in California?

Often no. Under Gov. Code § 65852.2, an accessory dwelling unit created under the state ADU rules must be rented for terms longer than 30 days, which bars sub-30-day short-term rentals of those units. Confirm your specific ADU’s status before counting on STR income from it.

Last verified: 2026-07-21. Rules change — confirm current requirements with the California Coastal Commission, the Franchise Tax Board, and your local city or county government before operating.