The BREAKDOWN: Santa Cruz Vacation Rental Ordinances
Hello from Bri Steel, Broker/Realtor® & Owner of Live Love Santa Cruz!
Many people want to invest in buying a house and then rent it out "short term". However, they do not know that there are many rules and regulations associated with rental properties in our county. As a result, people make risky buying decisions without having the right information. There are things they need to know, such as that some areas do not allow short-term rentals or that permit capacity has reached a limit.
If you are thinking about purchasing a rental home in Santa Cruz, this is the information you need to know.
In 2021, Santa Cruz County enacted a new ordinance that regulates the operation of short-term rentals. These rules apply only to residences in Santa Cruz County. Homes and rentals in City of Santa Cruz and City of Capitola continue to fall under the ordinances for those jurisdictions.
Let us find out what this means.
The County has established three "Designated Areas" along the coast, each with its own capacity limit on the total number of short-term rental permits allowed in those areas.
The Designated Areas are Live Oak Designated Area (LODA), Seacliff, Aptos, and La Selva Beach Designated Area (SALSDA), and Davenport/Swanton Designated Area (DASDA).
Here are the Designated areas and the property limits associated with the area so you can better determine which one applies to your property.
Live Oak Designated Area (LODA) - This includes the Yacht Harbor Special Community and that portion of Live Oak that lies east and south of East Cliff Drive and Portola Drive from the intersection of 9th Avenue and East Cliff Drive to the intersection of Portola Drive and 41st Avenue.
Seacliff, Aptos, and La Selva Beach Designated Area (SALSDA)- This includes the Aptos Planning Area, which is bounded on the west by the Capitola City limits, on the north by Highway 1, and on the east and southeast by Bonita Drive, San Andreas Road, the Urban Services Line from San Andreas Road to Monterey Bay, and the community of La Selva Beach.
Davenport/Swanton Designated Area (DASDA): This includes the North Coast Planning Area bounded on the south by Riverside Ave and San Vincente Street in the unincorporated town of Davenport and extending north along Highway 1 to include the New Town and Davenport Landing areas south of Highway 1, and bounded on the north by the intersection of Swanton Road and Highway 1 and including all parcels within one-quarter mile of Swanton Road, but excluding all parcels adjoining Last Chance Road.
In addition to the capacity on the total number of allowed short-term rental permits in each area, there is also a maximum cap of 20% per block.
This means that just because a spot opens up on the waitlist, the permit may not automatically be granted if too many short-term rental permits are already on the block. You can check the map of existing vacation rentals here. Vacation rental permits do not convey/transfer upon selling a property with an existing permit.
There are three categories of permits for short-term rentals:
1) Vacation Rental Permit for an entire home. Important Note - Vacation Rental Permits are valid for 5 years. Vacation Rental Permits are NOT allowed on properties with Accessory Dwelling Units (ADUs).
2) Hosted Rentals are short-term rentals of one or two bedrooms in a home where the owner remains on-site during the rental. There is a cap of 250 total permits for the County and restrictions on permits in certain beach districts. Currently, there are no other permits available for vacation rentals. Permits for rentals are valid for 5 years.
3) Bed and Breakfasts are hosted short-term rentals of three to five rooms in a home where the owner will stay on-site during the rental. Bed and breakfast inns are currently permitted in the RA, RR, R-1, and RM Zone Districts. They are not allowed in the Beach Residential (RB) zone district.
With these restrictions buying a rental property might sound daunting, but there is good news!
There is still a total and block capacity outside of the designated areas; therefore, permits are still currently available!
Certain areas are not limited in the number of vacation rentals allowed, which include beach drive in Aptos, the Condos on Rio del Mar boulevard above Beach Drive, and certain areas of Capitola Village.
Don't be discouraged by the permit restrictions and regulations if you are considering purchasing a rental home; with the proper guidance buying a property is the easiest part.
At Live Love Santa Cruz we bring a fresh and innovative “boutique” approach to real estate in the Santa Cruz area. In the process, we make dreams come true.
Looking to sell? We will make your home SHINE. Listings like ours that are beautifully presented and professionally inspected sell faster and for more money.
Looking to buy? We help our clients write offers that WIN. We are competitors at heart and negotiators at work. We get results.
Call or email us to set up an appointment with our broker and owner, Bri Steel.
Bri Steel
Broker/Realtor® + Owner
Live Love Santa Cruz
831.200.6338
bri@livelovesantacruz.com
Bri Steel at the Live Love Santa Cruz office with her two mini Aussies Kiwi and Fiji.
