Carlsbad, CA - any insight in to STR regulation trends?

[Lisa Pond]

Hi there, I am researching STR investments in Carlsbad, California and understand the 2018 restrictions to the Coastal zone and the recent changes in city of San Diego. For those of you who are local, do you have a sense of the Carlsbad City Council and their perspective on STRs? Am looking for a current temperature check on whether Carlsbad is currently (and in the short-term) friendly for STRs in general.

I acknowledge that laws can change and have changed quite a bit in recent years, and that I should also consider an investment as working for MTR or LTR.  Thanks in advance for any insight you can provide!
   

[Madison Carlson]

Hi Lisa,

Many have concerns about the impact the upcoming STRO (Short Term Residential Occupancy) Ordinance in San Diego will have on rents/values.

The STRO webpage was recently updated. The updates include:

• Published STRO Implementation timeline:

• October 3rd, 2022 – Application Period Opens for all STRO license Tiers
• November 30th, 2022 – Tier 3 & Tier 4 License Period Closes
• December 16th, 2022 – Lottery conducted & hosts notified of the results
• January 6th, 2023 – Tier 3 & Tier 4 License Fees Due
• May 1st, 2023 – STRO Ordinance Implementation Date

I work on a team with the managing brokers at Class Realty Group. Personally, they own 4 units in Mission Beach as well as we manage 20+ rental properties for clients. Therefore, we have kept a close watch on STRO in San Diego. A few concerns we have are:

• What are my chances of getting a Tier 3 (Pacific Beach) or Tier 4 (Mission Beach) License for short term rentals?

• Will the reduction of short-term rentals increase rental inventory so much that long term rents go down and vacancy increases significantly?
• Will those that do not get a license choose to sell all at one time in an already cooling/uncertain real estate market?

Although we don't have all the answers, we have spent quite a bit of time analyzing the data provided by the City of San Diego and would be happy to share the insights with you! Hope this was somewhat helpful and would be happy to connect and chat more!