It’s been three years since the City of Los Angeles passed a home sharing ordinance (HSO) to regulate what properties can be offered as a short term rental, what fees can be collected by the city and what homeowners need to do to prepare a unit to be a short term rental (STR). But a recent report from Better Neighbors L.A. shows that enforcement of the ordinance dropped precipitously in 2022, and that leads to bad results for Angelenos, visitors and residents of neighboring cities including Santa Monica.
One way in which homeowners skirt laws about home sharing is to list them in neighboring cities. This can lead to both higher rent as a house in Santa Monica generally rents for more than one in neighboring Venice or Mar Vista. It can also lead to confusion about where fees can be paid, what rules need to be followed and even what emergency services might be called upon if needed.
From a regional perspective, units that should legally be used to address the housing and homelessness crises are taken off the long-term housing market by homeowners that use subterfuge to avoid local home sharing laws.
In 2022, McGill University Professor David Wachsmuth studied the effect of short term rentals (pdf) on affordable housing in LA. He found that STRs have removed 2,500 homes from the long-term rental market and are responsible for more than 5,000 extra people experiencing homelessness each night.
For the past year, residents along 5th avenue in Venice have suffered as a result of one of these rogue rentals.
905 5th Avenue in the Venice Community has become a headache for locals. In March of 2022, the house was sold and converted from a local house to an AirBnB. The new owners listed the property in Santa Monica instead of Venice (it’s close, but definitely still in Venice). Listing a house in the wrong city is a clear violation of AirBnB and the City of Los Angeles’ HSO, but it was hard to get anyone to actually care.
“They just ignored us,” said a local resident whose property shares a wall with 905 5th Ave, of the city and even AirBnB when they launched complaints following after-hours parties and unpleasant encounters. “AirBnB finally pulled their listing when we were on the phone with them and they could hear the noise coming from the house through the phone at 3 in the morning.”
However, the City of Los Angeles awarded the owners a permit to continue operations and AirBnB reinstated them after the permit was issued. Instead of getting help from either the city or AirBnB, the neighbors found themselves buying a higher fence instead.
This is not a unique story in Los Angeles today. Better Neighbors LA monitored 60 home sharing sites in 2022 and noted there were an average of 4,272 monthly STRs advertised. More than half did not comply with the HSO. From the 2,228 non-compliant monthly listings found by Granicus, the City only fined and/ or sent warning letters to around 64 of those hosts per month—allowing roughly two-thirds of violators to operate with impunity.
“Illegal short-term rentals hike up rents, creating a cascade that pushes people out of their neighborhoods and pushes those on the verge of homelessness into homelessness,” said Executive Director of Better Neighbors LA, Randy Renick. “The city of Los Angeles can’t afford to lose any more affordable housing.”
For its part, Santa Monica is more focused on enforcing its own Home Share Ordinance than worrying about its neighbors inability to enforce their own. First passed in 2015, the ordinance was challenged by AirBnB and other home share websites because of a rule that they would be prohibited from collecting fees for Santa Monica properties that don’t comply with elements of the Home Share Ordinance. Santa Monica won in court, and other communities have followed the city’s lead when writing their own ordinances.
However, in the case of Venice property listed above, there was no attempt to register with either Santa Monica nor Los Angeles until after the neighbors’ complaints.
