Laurie Johnson

Changes to Placer County Short Term Rentals

In July, the Placer County Board of Supervisors approved a temporary moratorium on new short-term rental (STR) permits in North Lake Tahoe. It was a measure to address the unprecedented and growing housing crisis in the region. Just recently, we’ve received information about exemptions. This will be good news for some sellers in possession of a current permit.

The urgency ordinance, approved by a 4-0 vote, took effect to allow county officials to review the county’s current vacation rental ordinance that went into effect in January 2020.

Reason for the Moratorium

The steep increase in housing prices seen throughout California and across the country in recent years has been especially acute in North Lake Tahoe, where the median price for a single-family has more than doubled in just a year - from $660,000 in April 2020 to $1,342,000 in April 2021.

The real estate “boom” encouraged many homeowners to sell houses that were used as long-term rentals, county staff report; further decreasing an already limited housing stock for the local workforce.

Currently, permitted short-term rentals account for about 15% of the total 15,747 housing units in eastern Placer County. Many other jurisdictions in California have already taken action to impose limits on the number of STR permits issued, imposed other location requirements or imposed moratoriums on new permits, including South Lake Tahoe, El Dorado County and Mammoth Lakes.

Balancing the Housing Crisis

“Short-term rentals are a vital part of our community and that has been a tradition for decades,” said District 5 Supervisor Cindy Gustafson. “But we’re acting here out of concern for community preservation, and we need to find balance. The housing issues in our community have dramatically escalated, and investments in homes for use as short-term rentals have contributed to inflating property values beyond the reach of local workers to afford. We need a time out to study this and really understand what is going on to improve our short-term rental ordinance.”

Several local employers, including the Tahoe Truckee Unified School District, report they’ve become aware of employees living out of their cars or camping in the forest after being displaced from long-term rentals and struggling to find new homes. Many other employers report increasing difficulty in hiring workers due to the lack of housing.

Placer County offices in Tahoe have also struggled to hire and retain employees, prompting the board’s related action to move forward with joining the Truckee Tahoe Workforce Housing Agency.

From January 2020 to May 2021, 62% of all applicants to Placer’s Tahoe job listings lived more than 55 driving miles away from the employment site, county data indicate. Managers have noted difficulty in filling positions and concern over retaining existing employees or filling future openings. Several applicants who were offered jobs declined due to the inability to find suitable housing in the area.

Good News Issued in September 2021

Obviously, this has created a lot of confusion and concern for current and future real estate transactions. However, in September the following exemptions have been clarified, which is good news for potential sellers:

  • Anyone who had a STR permit in 2020 and didn't renew for whatever reason can get a STR permit for the 2021 permit cycle.
  • Anyone who has a valid STR permit and is selling their property can essentially sell the home with the STR permit - the person who comes in to purchase that property may also get a STR permit. This exemption is not tied to the July 27 date - this will run through the entire moratorium period… so as an example, someone can sell their property in November and as long as they have a valid STR permit, the person buying can get a STR permit on the same property.
  • Anyone who started a STR permit application prior to the July 27, 2021 board action will get their permit issued.

ABOUT PLACER COUNTY STR ORDINANCE

Placer County’s Short-Term Rental Program establishes rules for vacation rentals in unincorporated areas of eastern Placer County. Short-term rentals are residential units rented for 30 days or less, typically advertised as vacation rentals.

Placer’s Short-Term Rental Ordinance  (PDF) is intended to strike a balance of reducing neighborhood nuisances like noise and parking issues related to vacation rentals without undermining the market for this important guest accommodation.

Per Tahoe Regional Planning Agency code, short-term vacation rentals cannot exceed four per parcel.

The Lake Tahoe Basin and surrounding areas in unincorporated eastern Placer County are known for their scenic beauty and recreational opportunities. The area has become a world-renowned vacation destination. While vacation rentals have been a staple in eastern Placer County for years, the recent surge in popularity of the short-term rentals in this area have created compatibility issues in established residential areas.

These issues are endangering the health and safety of residents and guest and endangering the very environment and resources that attract visitors. To ensure protection of the health and safety of residents and guests, and to protect the environment, it is the purpose of this article to provide permit procedures and establish standards for short-term rentals in this area.

This ordinance required permits and set out the requirements on how to obtain one. It requires an application process that includes owner name, information, unit type, number of bedrooms, maximum occupancy set at 2 people per bedroom, parking and noise controls, inspections and permit process. In addition, it allows for complaints to be processed by other residents.  Permits expire on March 31st of each year, unless revoked or suspended.

It is important to work with a realtor who is aware of the changes to STR ordinances. Home values have soared in Lake Tahoe. Use this tool to see how much your home is currently worth.

There has never been a better time to get top dollar for your property. Inventory levels remain low, while demand is at all time highs. Contact me today for a free property evaluation and sales strategy.

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