An accessory dwelling unit (ADU) provides additional living space on your property that you can use for a wide range of purposes. On top of giving a senior loved one or an adult child a place to live nearby, you may also opt to allow others to rent the ADU. In California, you can list your ADU for rent on Airbnb, but you’ll need to be aware of both state and city laws that may affect how and when you operate a rental property. Below, the pros from Forever Builders, one of the top remodeling companies San Diego homeowners trust for exceptional craftsmanship and outstanding service, explain what you need to know about listing your ADU on Airbnb.
Make Sure the Airbnb Rental Meets Building Requirements
The first thing to know is that an ADU is typically defined by its ability to provide people with a place to live independently. This means it has a permanent kitchen along with a bathroom that has at least a toilet, a sink, and a shower. This differs from a typical room addition that may provide space for sleeping but not access to a place to cook and bathe. If you’re building an ADU, you’ll also want to work with a contractor who understands the state and local laws that govern safe buildings. For example, sleeping areas typically require two exits in case of a fire, one of which can be a window.
Know the State & City Laws Regarding Length of Stays
Many laws governing rentals in California are designed to alleviate the current housing shortage. In an effort to encourage property owners to use ADUs for long-term primary residential use, state law restricts short-term rentals to no longer than 30 days. Keep in mind many cities have different ordinances in place regarding how long you can rent the ADU out. For instance, San Francisco currently allows ADUs to be listed for a maximum of 90 days in a calendar year.
Understand the Owner Occupancy & Residency Laws
Many cities require you to live in your primary residence for a certain portion of the year to be eligible to place your ADU for rent on services such as Airbnb. For example, Los Angeles requires you to live in your primary house for at least six months out of the year. Meanwhile, San Jose offers you the ability to use the ADU for rentals throughout the entire year, provided you live on-site the whole time. If you live in the main house for only part of the year, your rental time is reduced to 180 days each year.
Find Out if You Need a Business License or Permit
California doesn’t require you to get a permit, but you’ll be considered a business owner according to state law. This also means you’ll be required to pay taxes, including the Transient Occupancy Tax, on your rental earnings.
Most cities require special licenses or permits. Los Angeles even specifically requires you to list your home-sharing registration number on the unit’s Airbnb listing.
Maximize Your Rental Property
The laws and ordinances that govern ADU rentals in California are designed to protect everyone. The extra effort you put into renting the ADU can also produce quite lucrative returns. To get the most from your listing, remember to build your ADU or remodel your existing one to ensure it’s appealing to renters. Making sure you keep your ADU rented for maximum occupancy helps you capitalize on your investment with a steady income.
If you’re considering adding an ADU to your home, it’s essential to hire top-notch contractors. The team from Forever Builders are trusted experts in home remodeling San Diego homeowners rely on, offering affordable services that bring your vision to life. From design to completion, we’ll help you create your dream home, meeting all your expectations while staying within budget. To learn more about our exceptional remodeling services, contact one of our friendly team members today.