Coastal Commission OKs Laguna Beach ban on new short-term rentals in residential zones

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An aerial overview of North Laguna. Photo by Daniel Langhorne

The California Coastal Commission unanimously approved Laguna Beach’s new plan to regulate short-term lodging, including a ban on new rental units in residential-zoned neighborhoods, at its virtual meeting on Wednesday.

The Commission’s decision effectively concentrates the conversion of residences into short-term rentals within the city’s commercial districts. This would provide relief to some residents who fear a proliferation of commercial ventures in neighborhoods, bringing in house parties, parking shortages, and trash.

Mayor Bob Whalen said in a statement Wednesday night that city leadership is very gratified by the Coastal Commission’s unanimous approval today of the short-term lodging ordinance.

“This culminates years of public hearings and work by City staff,” Whalen wrote. “I believe the result, which is to ban all new short-term lodging in residential zones, is strongly supported by our residents who value greatly the peace and quiet of their neighborhoods. It also helps to preserve our long-term rental housing supply and protects residents who are renting units in the residential zones from eviction for short-term lodging. This is a very positive outcome for our city.”

Laguna Beach currently has 117 short-term lodging units currently operating in the city limits, including 79 in residential-zoned districts. All of these units will be allowed to continue operations.

Following the Coastal Commission’s approval on Wednesday, Laguna Beach could allow up to 465 short-term rental units, including 300 non-home sharing units and 165 home-share units.

The amendment also allows existing residential units that don’t conform to city development standards, parking, and density in commercial-zoned districts to be converted into short-term lodging, except for units restricted by covenant.

The Coastal Commission has taken the position in recent years that short-term rentals are an essential component for public coastal access—especially to families who can’t afford a traditional hotel room. Some local advocates have pushed back on this, saying that many Laguna Beach rentals actually cater to wealthier customers.

“Us as an aggregated group tends to have a higher income than the rest of the state,” Commissioner Mike Wilson said to fellow commissioners. “Understand that shared homes—even in the early days or AirBnb with couches—do allow for accommodations that people can afford.”

Carl Kikerpill, a Laguna Beach resident and co-founder of Home Share 4 Laguna, said he was disappointed with the Commission’s decision to reject a simple solution presented by aspiring hosts.

“It’s going to limit the amount of families that are going to be able to come to Laguna Beach and visit,” Kikerpill said. “It’s going to impact businesses. [Our proposal] is a much more reasonable approach than allowing new buildings in the commercials district and use those as short-term rentals.”

Home Share 4 Laguna had hoped to allow Laguna Beach homeowners to rent their primary residence when they travel. Kikerpill pointed out that they’d be very careful about who they rent it to.

“For some people, the only ways they can afford their home is to rent it out in the summer,” he said.

The Commission’s decision lands at a time when Laguna Beach and other Orange County cities are pushing back against a regional housing allocation benchmark set by the Southern California Association of Governments (SCAG).

Commissioner Katie Rice asked Marc Wiener, community development director for Laguna Beach, if the conversion of homes to short-term rentals would have any impact on the city’s Regional Housing Needs Allocation. Wiener said SCAG officials told him there would be no impact at this time.

“We want to make sure that any units that are converted don’t end up with a vested right to be a short-term lodging property,” Rice said.

As a condition of approval, city officials must report back to the Commission in three years to revisit the short-term rental program and study whether the new units are contributing to the loss of lower-cost hotel and motel rooms or affordable housing.

This story is developing and will be updated as necessary.

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2 COMMENTS

  1. What a rotten stinky deal: those who already had an airbnb in a strictly residential area get to keep it as a business, but those of us who would want to, CAN’T. SO WRONG. Second stinky lump: developers or owners of high end mixed use properties along Coast Highway get to have their share of airbnbs whether already built or not and have unfettered access to attract short-term renters. But someone who has a residential property, such as a duplex, ADU or mother-in-laws quarters CAN’T. SO WRONG again.
    So much for sharing your lovely abode with world travelers…..unless you already have or have big $$$$$$$$$$.

  2. While the California Coastal Commission claims to be protecting access to the beach, they don’t seem to be doing a very good job. Multiple cities along the coast have banned, or effectively banned, short term rentals. Obviously, this will result in fewer STRs. When you cut supply, but demand stays constant, prices rise. Higher prices mean fewer people will get to enjoy meaningful time on our beaches.

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