On any given night, 2 million people are staying in Airbnb rentals across the world. And with over 650,000 hosts, Airbnb is one of the most popular ways for homeowners to make extra money via short-term renting.
As a year-round vacation location, the Coachella Valley is unmatched. Our warm sun, cool pools, and world-class dining and shopping make the Greater Palm Springs area an attractive destination for travelers from all over the globe.
The housing vacancy rate in Palm Springs is 36%, and most of those vacancies are second homes. From business travelers looking for a comfortable place to stay to young couples looking for the perfect summer escape, Palm Springs homeowners are in the perfect position to cash in on the year-round influx of vacationers by renting out their homes on a short-term basis via Airbnb.
But before you start listing your home, there are important things you need to know about the laws regarding short-term renting in the Palm Springs area. Here’s everything you need to know about renting out your Palm Springs home on Airbnb.
What is a “Short Term Rental” or “Vacation Rental”?
A “short-term rental” or “short term lease” means renting out your apartment or house for a relatively short period of time.
The specific time period varies by each city, or by a governing body (like an HOA), but is usually defined as less than 30 or 31 days. In some cities, this can be up to 3 or even 6 months.
The City of Palm Springs defines the time period of a short-term rental as 28 days or less.
Palm Springs Short-Term Rental Types
The City of Palm Springs recognizes two types of short-term rentals: a homeshare and a vacation rental.
- A homeshare is a rental of one or more bedroom for 28 days or less while the owner resides in the home throughout the duration of the rental.
- A vacation rental is any accommodation that is available for 28 days or less without the owner present.
Any unit that you rent for longer than the Palm Springs short-term rental period is a standard or long-term rental.
License Requirements for Short-Term Rentals in Palm Springs
Per Palm Springs’ short-term residential rental ordinance, hosts need 2 specific licensing requirements to legally operate either short-term rental type:
If you operate a short-term vacation rental or a homeshare without a Registration Certificate, you could be hit with a $5,000 fine from the City of Palm Springs, and permanent ineligibility for any vacation rental operations.
If you have a single-family dwelling with 5 or more bedrooms, then your home qualifies as an Estate home. That means you’ll need to follow other specific requirements to rent out your home on a short-term basis, including needing a Land Use Permit.
Can a Homeowner Own More Than One Vacation Rental or Homeshare?
A homeowner in Palm Springs can only operate one vacation rental or homeshare Registration Certificate at a time. As of 2018, the City of Palm Springs no longer accepts applications for additional vacation rentals/homeshare properties.
However, any multiple Registration Certificates issued prior to January 10, 2017 still remain valid.
Can My Business Apply for a Vacation Rental Certificate?
The City of Palm Springs no longer accepts applications for business entities to register as a vacation rental or homeshare property. A business entity means a corporation, partnership, or other legal entity that isn’t a natural person, a personal or family trust or a limited liability company consisting solely of natural persons.
Any existing businesses with current Registration Certificates must transfer each vacation rental homeshare to a natural person, or else no longer operate the property as a vacation rental.
Can I Register as a Vacation Rental or Homeshare Property if I’m in an HOA?
If your home is part of an HOA (Home Owners Association), you need to obtain a letter from your HOA Board of Directors or from the Property Management Company that states that operating a Vacation Rental or Homeshare doesn’t violate the CC&Rs (Covenants, Conditions & Restrictions) of your HOA.
You’ll present this letter when applying for or renewing your Registration Certificate.
What are the Insurance Requirements for Short-Term Rentals in Palm Springs?
In order to apply for a Registration Certificate, you must have a short-term rental insurance policy or personal liability policy. Your policy needs to have a minimum limit of $500,000 per occurrence.
The City of Palm Springs doesn’t have to be an additional insured party on the policy.
Advertising Requirements for Your Airbnb Home
Once you’ve received your vacation rental or homeshare Registration Certificate, you’ll get a four-digit City ID number. Include that number in the description of your Airbnb listing in the following format: “The City of Palm Springs ID #XXXX”.
Transient Occupancy Tax for Airbnb
The City of Palm Springs assesses transient lodging taxes on hotels, inns, vacation homes or houses, and other short-term rentals.
Your Transient Occupancy Tax must be reported and paid to the City each month. Check the City’s Vacation Rental TOT Information page for more information about the transient occupancy tax.
Occupancy Limits for Your Palm Springs Airbnb
Occupancy per bedroom is limited to 2 adult overnight guests and 1 vehicle.
Night Limits for Palm Springs Airbnbs
In Palm Springs, vacation rentals have an annual limit of 32 nights of guest stays per calendar year, with an additional 4 guest stays during July, August, and September. Homeshares don’t have an annual limit.
Although this blog provides the baseline information you need to know about using your home as a short-term rental, remember to check with your community about other types of local rules if your home belongs to a condo complex, HOA, timeshare, or other tenant organization.