What is the Home-Sharing Program?

Two years have passed since the Los Angeles City Council adopted the Home-Sharing Program, and one year since the City began to enforce this new program. A program which today has established a regulatory framework to allow short-term rentals only in one’s primary residence.

Granted, short-term rentals were already prohibited under the City’s prior Zoning Code, even prior to the creation of the Home-Sharing Program, Council adoption of the Home-Sharing Ordinance provided additional clarification and tools for enforcing against unlawful rentals. 

It provided a legal pathway for legitimate homeowners to rent out a room, or even their entire home, as a source of income without the unintended consequences associated with taking long-term housing units off the market. Given how cities across the nation are confronted with a housing shortage, Los Angeles remained vigilant about protecting its housing stock.

As a City, we did not want to indirectly subvert or hinder access to housing at a time when City Planning is focused on achieving a well-balanced distribution of market-rate and affordable units, including housing for working-class and lower-income residents across Los Angeles. 

In 2015, when Council first introduced this topic, the mandate to City Planning was simple: help us draft an ordinance that would allow Los Angeles residents to rent out a spare room, back house, or even their entire home while they are out of town, but make sure to prohibit individuals from renting our unit or buildings that are not their primary residence or units that are subject to the Rent Stabilization Ordinance, and for good reason!

More than three years have passed since Council first considered this issue. Multiple hearings have taken place, the issue was debated in an open public setting, and an extensive outreach campaign took place to solicit input and feedback from neighborhood stakeholders.

What is in place today is the result of that process. An ordinance that has helped prevent the wholesale conversion of homes into rental properties, while still allowing a limited form of short-term rentals in a manner that is in alignment with the City’s housing needs.

 

We didn’t just pass an ordinance. We created a framework that showcased how city agencies can ease the application process for both the host as well as the City when it comes to enforcement. To register, City Planning developed an online portal, which has made it possible for hosts to register in less than 30 minutes and from the comforts of their home.

The City began accepting applications on July 1, 2019 but started enforcement on November 1, 2019, in order to give hosts time to register and to launch an educational campaign that consisted of citywide workshops. These public workshops had more than 550 attendees, not to mention countless others who participated in the webinar and Twitter chat.

With this new program, hosts today must register with the City and be approved prior to engaging in Home-Sharing. In addition to meeting all of the requirements as set forth in the ordinance, hosts are responsible for listing their registration number on all advertisement listings. This unique number is what the City uses to verify whether a host is following the rules.

Short of meeting those requirements, hosts are in violation of the HSO. As further outlined below, City Planning has taken enforcement action against illegal listings that were not in possession of a valid registration number. (To learn more, check out our website!)

As of July 3, over 9,000 unique listings have been referenced in warning letters for non-compliance. The good news is that nearly 80% have taken steps to fall into compliance after receiving a second warning letter, without having to resort to the issuance of any citations. 

From a housing perspective, the results have fared even better. As of November 2019, we’ve seen a 62 percent decrease in listings across all hosting platforms in Los Angeles, from about 36,700 short-term listings in November 2019―a sign that we are off to a good start.

What’s next, you ask? At City Planning, we’re finalizing the testing for the first-of-its-kind online compliance system that would further streamline the removal process for illegal listings. This new system will rely on an Application Programming Interface (API), and will grant the City the ability to monitor many of the world’s short term rental websites using secure artificial intelligence algorithms that link multiple listings for the same property across hosting platforms.

Beyond linking multiple listings to actual addresses, the API system will also give City Planning the ability to easily cross-reference other data sources including zoning maps, property ownership records, a list of Ellis Act evictions, and other datasets that the City maintains.

At City Planning, we’re all about efficiency, and leveraging technology and innovation to provide better services to our residents and customers alike. This has been our approach with Home-Sharing from the outset and a reason why we remain proud of our efforts to date. There is certainly more work to do, including around enforcement, but we are committed to the task at-hand, and are working with our enforcement agencies (both Building & Safety and Housing + Community Investment Department) to deliver on our commitment to the City. 

For additional information, do not hesitate to contact us at planning.home-sharing@lacity.org.