Lake Forest Short Term Rental Regulation: A Guide For Airbnb Hosts

What Are Short-Term Rental (Airbnb, Vrbo) Regulations in Lake Forest, California?

Short-term rentals like Airbnb and Vrbo are allowed in Lake Forest, but the city has specific regulations that hosts must follow according to the municipal code and zoning ordinances. One of the key rules is that short-term rentals are only permitted in residential zones if the owner lives on-site as their primary residence. This prevents homes from being converted into full-time vacation rentals. The zoning code states:

"No short-term rentals shall be permitted...unless the short-term rental operator resides in such short-term rental property at all times when guests occupy such property."

There are also requirements for obtaining a short-term rental permit, paying transient occupancy taxes, having proper STR insurance, and following rules regarding parking, noise, trash, etc.

Enforcement has been an issue, with some residents complaining about investor-owned Airbnbs operating illegally in residential neighborhoods and the city struggling to identify violators. However, Lake Forest has been cracking down more recently by issuing violations and fines.

Starting a Short-Term Rental Business in Lake Forest

If you want to legally operate a short-term rental in Lake Forest as a resident host, here are the key steps:

• Ensure you will be living in the property as your primary residence, as the zoning code requires.
• Review the short-term rental regulations in Chapter 5.24 of the Lake Forest Municipal Code.
• Apply for a short-term rental permit and business license from the City. This involves a home inspection to ensure your property meets safety and parking requirements.
• Register with the City to pay your rental income 10% transient occupancy tax (TOT).
• Obtain proper liability insurance for operating a short-term rental business.
• Familiarize yourself with the operational requirements around noise, trash, parking, number of guests allowed, etc.
• Create your Airbnb/Vrbo listing, clearly stating you are a resident host who will be present.
• Pay an annual renewal fee to maintain your short-term rental permit.

While Lake Forest allows some resident hosts to operate short-term rentals, there are a number of regulations regarding permitting, taxes, insurance, and following best practices. Make sure you understand and follow all the rules to avoid penalties.

Short-Term Rental Licensing Requirement in Lake Forest

Lake Forest has specific licensing and permitting requirements for operating a short-term rental in the city. According to the municipal code, hosts must obtain a short-term rental permit from the city before listing their property on sites like Airbnb or Vrbo.

To get a short-term rental permit, hosts must go through an application process that includes:

1. Paying a permit fee (amount varies based on the number of bedrooms)
2. Having the rental property inspected to ensure it meets safety and parking requirements
3. Providing proof of proper liability insurance
4. Designating a local contact person available 24/7 to respond to complaints

The permit application also requires the host to acknowledge they will follow all the operational rules, such as:

1. Collecting and remitting 10% transient occupancy tax (TOT) on rental income
2. Adhering to occupancy limits based on the property's size/bedrooms
3. Ensuring guests don't create noise, parking, or trash disturbances
4. Providing guests with the permit number and good neighbor guidelines

Short-term rental permits need to be renewed annually. Hosts must pay a renewal fee each year and certify they have remained in compliance with all regulations.

Importantly, Lake Forest only allows short-term rentals where the owner lives on-site as their primary residence. Non-owner-occupied vacation rentals are prohibited based on the city's zoning code.

So, in summary, any Lake Forest resident looking to rent out their home or rooms on Airbnb must first obtain a short-term rental permit, follow operational requirements around taxes/occupancy/nuisances, and renew the permit annually. The permitting process aims to ensure short-term rentals operate safely and with minimal neighborhood impacts.

Required Documents for Lake Forest Short-Term Rentals

Lake Forest has specific requirements around the documents and information hosts must provide when applying for a short-term rental permit. According to the city's municipal code, the permit application must include:

1. Proof of property ownership, such as a grant deed or tax records.
2. Proof that the rental unit is the host's primary residence, such as a driver's license, voter registration, or utility bills matching the address.
3. Floor plans detailing the layout of the rental unit and number of bedrooms.
4. A site plan showing parking areas and nearby street parking.
5. Contact information for a local 24/7 contact person responsible for responding to complaints.
6. Proof of liability insurance appropriate for operating a short-term rental business.
7. An acknowledgment that the host will follow all regulations around occupancy limits, noise, trash, parking, etc.
8. Payment of the permit fee based on the number of bedrooms being rented.

In addition to the initial permit application documents, hosts must also maintain records and provide documentation on an ongoing basis, including:

1. Guest registration records include names, home addresses, vehicle information, and stay dates.
2. Quarterly reports and payments for the 10% transient occupancy tax (TOT) on rental income.

The city may also require updated documents like renewed insurance certificates when the short-term rental permit comes up for annual renewal.

Failure to provide any of the required documents, records, or permit information can result in denial or revocation of the short-term rental permit. Hosts must diligently comply with all documentation to legally operate in Lake Forest.

Lake Forest Short-Term Rental Taxes

Short-term rental hosts in Lake Forest are required to collect and remit two different tax payments to the city:

1. Transient Occupancy Tax (TOT)
2. Self-Apportioned Sales/Use Tax

The Transient Occupancy Tax rate in Lake Forest is 10% of the rental revenue collected from guests. Hosts must register with the city's TOT program and submit the 10% tax payment on a quarterly basis, along with documentation of rental income and guest stays.

Failure to pay the TOT can result in penalties, interest charges, and potential revocation of the short-term rental permit. The city actively enforces and audits TOT compliance for vacation rentals.

In addition to the TOT, short-term rental hosts must also collect a Self-Apportioned Sales/Use Tax and remit it directly to the California Department of Tax and Fee Administration.

The statewide sales tax rate is 7.25%, but it gets combined with district taxes based on the specific rental location. For Lake Forest, the total Self-Apportioned Sales/Use Tax rate is 7.75%.

Hosts need to register with the CDTFA for a seller's permit, collect the 7.75% tax from guests, file quarterly returns, and submit the tax payments. There are penalties for failure to properly collect or remit this tax.

Between the 10% TOT paid to Lake Forest and the 7.75% statewide sales tax, short-term rental guests will have their rental fees taxed at a total rate of 17.75%. Ensuring full tax compliance is critical for legally operating a short-term rental business in the city.

Lake Forest Wide Short-Term Rental Rules

Lake Forest has enacted several regulations that apply to all short-term rentals operating within city limits. These rules are aimed at minimizing impacts on residential neighborhoods. Key requirements include:

1. Permitting: All short-term rentals must obtain an annual permit from the city before operating. This involves an application, fee payment, inspection, and renewal process.
2. Owner Occupancy: Only properties that are the owner's primary residence can be used as short-term rentals. Non-owner occupied, or off-site investor rentals are prohibited.
3. Occupancy Limits: Based on the size of the rental unit, there are caps on the maximum number of overnight guests allowed. For example, a 2-bedroom rental is limited to 4 adults.
4. Parking: Sufficient parking must be provided on the rental property. No street parking is permitted for guests.
5. Noise: Strict noise rules prohibit any excessive sound that disturbs neighbors between 10pm-7am.
6. Trash: Rental guests must utilize proper trash/recycling bins and cannot leave garbage outside except on pickup days.
7. Posting Rules: Rental listings must display the city permit number, occupancy limits, parking rules, and contact information for the 24/7 complaint hotline.
8. Liability Insurance: Hosts must maintain active liability insurance that is appropriate for operating a short-term rental business.

In addition to these regulations, short-term rental hosts and guests must follow all other applicable local laws around noise, nuisances, safety, etc. Violations can result in citations, fines, and potential permit revocation.

The city takes enforcement seriously, relying on a 24/7 hotline for complaints and conducting regular monitoring and audits of short-term rental listings and activity. Hosts must ensure they understand and follow all the rules to operate legally in Lake Forest.

Does Lake Forest Strictly Enforce STR Rules?

Based on discussions on forums like Bigger Pockets and Reddit, it appears Lake Forest takes a relatively strict stance in enforcing its short-term rental regulations compared to some other cities.

Many hosts complain that Lake Forest's rules requiring owner-occupancy and prohibiting non-owner-operated vacation rentals are too restrictive. One Bigger Pockets user stated, "Lake Forest is extremely unfriendly to STRs unless you live on-site. They have really cracked down hard."

There are reports that the city is actively monitoring rental listings to identify violators. A Reddit post mentioned, "Just had a friend get a $1000 fine in Lake Forest for advertising his rental without a permit and not being the owner-occupant."

However, some hosts seem to try operating under the radar, with one commenting, "I've had an Airbnb running for 2 years in LF with no issues so far; just don't advertise loudly." However, others warn that this approach is risky given Lake Forest's enforcement efforts.

Overall, the consensus from local host communities is that Lake Forest is not an Airbnb-friendly city, at least for investors looking to operate non-owner-occupied short-term rentals. The regulations are relatively strict, and the city proactively identifies violations by monitoring listings, responding to complaints, and levying penalties.

While some hosts may try their luck, many acknowledge the rules in Lake Forest leave little room for full-time, short-term rental businesses operating outside of owner-occupied properties. The city prioritizes preserving residential neighborhood character over facilitating vacation rentals.

How to Start a Short-Term Rental Business in Lake Forest

If you want to legally start a short-term rental business in Lake Forest, you must follow these steps:

1. Ensure you live in the property as your primary residence, as only owner-occupied short-term rentals are permitted per city zoning rules.
2. Review the short-term rental regulations outlined in Chapter 5.24 of the Lake Forest Municipal Code.
3. Apply for a Short-Term Rental Permit from the city. This involves:
   1. Submitting proof of property ownership and residency
   2. Providing floor plans and site plans of the rental unit
   3. Paying the permit fee based on the number of bedrooms
   4. Having the property inspected for safety/parking compliance
4. Register with the city's Transient Occupancy Tax (TOT) program to collect and remit the 10% TOT on rental income.
5. Register with the California Department of Tax and Fee Administration to obtain a seller's permit and pay the Self-Apportioned Sales/Use Tax of 7.75%.
6. Obtain proper liability insurance coverage for operating a short-term rental business.
7. Familiarize yourself with all the operational rules around occupancy limits, noise, parking, trash disposal, posting requirements, etc.
8. Create your listing on Airbnb, Vrbo, or other platforms, clearly stating that you are a resident host who will be present.
9. Maintain records of all guest stays to submit with quarterly tax filings.
10. Renew your short-term rental permit annually by submitting updated documents and paying the renewal fee.

Following all of these requirements is crucial, as Lake Forest actively enforces its short-term rental regulations through monitoring, responding to complaints, and levying penalties for violations. Make sure you understand and comply with every step to operate legally.

Who to Contact in Lake Forest about Short-Term Rental Regulations and Zoning?

If you have any questions or need to report violations related to short-term rental regulations and zoning in Lake Forest, you can contact:

City of Lake Forest
Community Services Department
25550 Commercentre Dr. #100
Lake Forest, CA 92630
Phone: (949) 461-3450

The Community Services Department oversees the permitting, regulation, and enforcement of short-term rentals in Lake Forest. You can call or visit their offices to:

1. Inquire about short-term rental rules and the permitting process
2. Apply for or renew a short-term rental permit
3. Get clarification on regulations like occupancy limits, parking, noise, etc.
4. File a complaint about an illegal or non-compliant short-term rental.

For any issues specifically related to zoning rules, permitted uses in certain areas, or requesting an interpretation of the zoning code, you can contact:

City of Lake Forest
Planning Division
Phone: (949) 461-3491

The Planning Division enforces the zoning ordinances, including the requirement that short-term rentals only be permitted at a host's primary residence.

You can also report any general violations or nuisance issues related to short-term rentals through the city's 24/7 hotline:

Code Enforcement Hotline
Phone: (949) 859-4737

This hotline allows you to file complaints about noise, parking, trash, or other public nuisance violations from short-term rental properties.

For any permitting, zoning, or enforcement questions and issues regarding short-term rentals in Lake Forest, the Community Services and Planning departments are the primary points of contact.

What Do Airbnb Hosts in Lake Forest on Reddit and Bigger Pockets Think about Local Regulations?

The short-term rental regulations in Lake Forest, particularly the owner-occupancy requirement, are a point of contention among many hosts on forums like Reddit and Bigger Pockets:

Reddit user: "Lake Forest is extremely unfriendly to any kind of STR unless you literally live on the property full-time. Their rules make operating an Airbnb as an investment property impossible."

Bigger Pockets post: "Just got hit with a $1,500 fine from the city of Lake Forest for advertising my rental without the proper permit and not being the owner-occupant. They are cracking down hard on enforcing these rules."

Another Redditor: "I've had an Airbnb running for 2 years in LF with no issues so far, just don't advertise loudly. But always a risk of a neighbor complaining and the city coming down on you."

Some express frustration with the regulations and taxes:

"The 10% TOT that LF charges on top of other taxes makes it really hard to be profitable as a host there."

However, others understand the reasoning behind the rules:

"I get why cities like Lake Forest have strict policies - they don't want residential areas turned into de facto hotels with investor-owned Airbnbs everywhere."

Many hosts view Lake Forest as being relatively unfriendly towards short-term rentals, especially for investors looking to operate multiple non-owner-occupied units. The regulations prioritize preserving neighborhood character over facilitating vacation rentals.