Short Term Rental Rules around Lake Tahoe
Will your Lake Tahoe property be a vacation rental?
(Updated on May 17th, 2022)
Many people dream about owning a second home in Lake Tahoe. But for many, having a home sitting empty when they are not using it, is not a good option. When buyers look to purchase a property in Lake Tahoe, they don't want just a second home, they are simultaneously looking for an investment. They wish to rent the property when they are not using it in order to offset some costs. So why not purchase a home and turn it into a VHR (Vacation Home Rental) by renting it out through websites like AirBnB and VRBO? If you, like many other buyers, ever had this thought, please be sure to do your home work very well. Because there are five different counties around the Lake, and every county has a different regulation when it comes to STR (Short Term Rentals). Almost everyday we receive questions like "Is this property located in an area that allows short term rentals?". That's why we decided to put together this information about vacation rental rules all around the Lake.
South Shore California
- South Lake Tahoe (City neighborhoods) - In November 2018, Measure T was implemented and since then, vacation rentals have been banned from the city of South Lake Tahoe. Measure T also says that current permit holders won't be allowed to renew their permits in 2021. So every homeowner who previously had a vacation rental permit, lost their permit by the end of 2021. To know what area vacation rentals have been banned, see below a map of the city of South Lake Tahoe. Vacation rentals have been banned within the area that's outlined in red.
- Tourist Core (South Lake Tahoe) - The tourist core area is located within the city limits of South Lake Tahoe, but the area is zoned for commercial and tourism. Vacation rentals are still allowed in the Tourist Core area. There's only a handful of single-family homes in that area and they rarely come up for sale. Besides that there are a few condo complexes that are located in the Tourist Core and therefore exempt from Measure T (such as Lakeland Village, Sierra Shores, Tahoe Woods and Zalanta). *Please contact us for an updated list of properties currently for sale in the Tourist Core ([email protected])
- South Lake Tahoe (County neighborhoods) - Go back to the map of South Lake Tahoe city at the top... All the South Lake Tahoe neighborhoods outside of the area highlighted in red are considered county neighborhoods. Vacation rentals are still allowed in the county, but there are some restrictions. If you are looking to purchase a property in El Dorado County, please be sure to check the buffering map first. If your property is in a 500 foot buffer zone of a permitted property, it is not eligible for a VHR permit. If it is in the Tahoe area, it is subject to the 900 permit cap and there are not any permits available at this time. You can be added to a waitlist once you purchase a property but it is uncertain that you will ever be able to obtain a permit. Properties that have an active permit when a house changes ownership do not transfer. When the house sells, the permit becomes null and void.
South Shore Nevada
Lake Tahoe Nevada (within Douglas County) - This is the area that incorporates neighborhoods such as Stateline, Zephyr Cove and Glenbrook. They have implemented a cap to limit the amount of vacation rentals in the Tahoe Township area. This new ordinance went into effect on July 15th, 2021. Douglas County will establish a list of property owners who will be randomly selected to qualify to apply for the remaining permits available under the 600 permit cap. The remaining applicants will be placed on a waitlist to qualify to apply for future available permits. Each year the waitlist applications will be accepted through July 1st through July 31st of the calendar year ONLY.
Incline Village Nevada (East Shore)
Incline Village Nevada (aka East Shore) is part of Washoe County. There are currently no rental restrictions in Incline Village. Although there are rental regulations and a rental permit must be obtained from the county. Please keep in mind that for condos and townhouses, most of the homeowner's associations in the area do not allow short term rentals.
North Shore/West Shore CA
The North Shore area (Tahoe City, Tahoe Vista, Kings Beach, Carnelian Bay, Squaw Valley and Northstar) and some areas on the West Shore (Homewood and part of Tahoma) are located in the Placer County. On August 31, 2021, the Placer County Board of Supervisors approved an extension to the Urgency Ordinance moratorium until March 31, 2022.
The board in Placer County has made adjustments to the ordinance and there will be a cap at 3900 in the amount of rental permits. Once the moratorium is lifted, first priority will be given to those who need renewal. Second priority will be given to those who were exempt before this ordinance in Olympic Valley and various other homes (People who purchased a property during the moratorium, where the property had a valid rental permit). Third priority is given to those who applied for an STR permit after the moratorium, or new applications. New STR permit applications, that are received prior to reaching a total cap inventory, will be processed on a first come first serve basis. At such point that the total cap inventory is reached, all outstanding permit applications, either in process or received will be placed on a waitlist. A change of ownership of property with a permitted STR Unit shall result in the automatic termination of the STR permit. The new owner may apply for a new STR permit. The Agency will continually maintain the overall cap inventory as permits are not renewed or revoked and on a quarterly basis. Commencing on July 1, 2022 will open up the application process to those on the waitlist.
Truckee is part of Nevada County. On Tuesday April 12, 2022, the Town Council waived the second reading and adopted Ordinance 2022-02 amending Chapter 5.02 of the Town of Truckee Municipal Code regarding regulation of Short-Term Rentals (STR). On Tuesday April 26, 2022, the Town Council adopted Resolution 2022-16 approving updates and additions to the Short-Term Rental Fee Schedule.
The STR Ordinance modifications include:
- Registration Certificate Cap of 1,255.
- Phase out STRs in Accessory Dwelling Units (ADUs) and Multi-Family Dwelling Units
- 365-Day Waiting Period after a home sale before the new owner may register as an STR
- Increase Penalties for Violation of the ordinance
- Two-part Waitlist Application Process including a $100 non-refundable deposit
To recap, STR's are not allowed in South Lake Tahoe city neighborhoods, except on properties located in the Touristic Core. STR's are allowed in South Lake Tahoe county neighborhoods (El Dorado County) but permits are subjected to the 500 foot buffering rule.
STR's are allowed in South Shore Nevada (Douglas County), you may apply for a rental permit once a year, every July. The remaining permits available under the 600 permit cap will be distributed based on a lottery system.
STR's are still allowed in Incline Village Nevada (East Shore - Washoe County). Although if you're looking at a condo, most HOA's have restrictions on short term rentals.
STR's are allowed in North Lake Tahoe and part of West Shore (in Placer County) but permit applications are subjected to a cap of 3,900 permits. There will be an unknown amount of waiting to obtain a permit.
STR's are allowed in Truckee CA (Nevada County), however they have 365-Day Waiting Period after a home sale before the new owner may register for a STR permit and a cap of 1,255 permits.
Please feel free to contact us if you have any questions about Lake Tahoe Real Estate or local regulations. We would love to have the opportunity of guiding you through the process of purchasing your Lake Tahoe Home.