🎯 STRisker: Bulletin - San Diego, CA

A Deep Dive into Your Area’s STR Updates—Helping You Navigate the Ever-Changing Rental Landscape.

San Diego’s TOT Increase: What Short-Term Rental Hosts Need to Know

Starting May 1, 2025, San Diego will implement an increase in the transient occupancy tax (TOT) following a voter-approved measure in 2020. The city hopes this tax hike will bring in much-needed revenue to address its $250 million budget deficit funding everything from street repairs to homelessness initiatives and improvements to the Convention Center.

For short-term rental hosts, this means a new tax burden, as the increase will also apply to vacation rentals along with hotels and RV parks. The new rates will vary depending on how close the property is to the Convention Center with the highest rate set at 13.75% for properties in the downtown area. More distant properties will pay slightly lower rates: 12.75% or 11.75% depending on location.

The city estimates the increase will raise about $82 million in its first year, with the total revenue over 10 years expected to top $1 billion.

Here's where the extra money will go:

During the first five years, the additional revenue will be distributed as follows:

• 59% will go toward upgrades and operational support for the Convention Center.
• 41% will fund homelessness services, including shelters, permanent housing, and related programs.

In years six through ten, the distribution will be adjusted:

• 59% will continue to support the Convention Center.
• 31% will be directed to homelessness initiatives.
• 10% will be allocated to street repairs and infrastructure improvements.

This move has been a long time coming. After voters approved the measure in 2020, the implementation was delayed due to legal challenges, but the city has finally won the court battles and is moving forward. The city’s Office of the City Treasurer will soon notify lodging operators, property management companies, and short-term rental hosts about the new tax rates.

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