Overview: STR Legality in San Jose

Short-term rentals are ALLOWED in San Jose, California. The city permits Airbnb and other short-term rental operations through its San Jose Municipal Code Section 20.80, Part 2.5, which regulates transient occupancy in residential units. However, operations must comply with specific requirements and restrictions outlined in local ordinances.

How to Start a Short-Term Rental Business in San Jose

Step 1: Verify Property Eligibility

• Ensure your property is your primary residence where you live at least 60 consecutive days annually
• Confirm the property type is eligible (single/two-family homes, multi-family dwellings, mobile homes, live/work units, guest houses)
• Note: Accessory Dwelling Units (ADUs) are NOT permitted for short-term rentals

Step 2: Obtain Required Registration

• Register for a Business Tax Certificate within 90 days of starting operations
• Complete business registration through the San Jose Finance Department portal
• Display the certificate at your place of business

Step 3: Tax Registration

• Register for Transient Occupancy Tax (TOT) collection and remittance
• Use the hotel taxes forms portal for registration

Step 4: Set Up Safety and Compliance Measures

• Install functioning smoke and carbon monoxide detectors
• Designate a local contact person available 24/7 when you're not present
• Notify neighbors in writing when operating non-hosted rentals
• Establish guest screening and damage protection protocols

Required Documents, Permits, Licenses, and Guidelines

Essential Documentation:

• Business Tax Certificate (mandatory for all STR operations)
• Primary residence proof (government ID, utility bills, insurance documents, voter registration)
• Tax Identification Number (SSN, FEIN, or TIN)
• Driver's License of principal owner
• Transient Occupancy Tax registration

Required Information for Registration:

• Property addresses for all business locations in San Jose
• Ownership names and addresses
• Contact telephone number and email address
• Contractor's number (if applicable)
• State seller's permit number (if applicable)
• County health permit number (if applicable)

Ongoing Compliance Requirements:

• Record keeping: Maintain all rental records, tax documents, and booking details for minimum 3 years
• Guest limits: Enforce occupancy restrictions based on property type
• Annual reporting: Update business registration annually
• Neighbor notification: Provide written notice with 24/7 contact information

Specific Short-Term Rental Regulations

Property Type Restrictions:

• Permitted: Single-family homes, two-family homes, multi-family dwellings, mobile homes, live/work units, guest houses
• Prohibited: Accessory Dwelling Units (ADUs)

Primary Residence Requirement:

• Must be owner's primary residence with minimum 60 consecutive days annual occupancy
• Only ONE short-term rental permitted per person within city limits
• Must provide documentation proving primary residence status

Guest Occupancy Limits:

When Host is Present:

• Single-family homes: Maximum 3 guests
• Multi-family dwellings: Maximum 2 guests

When Host is Absent:

• Studio: Maximum 2 guests
• One-bedroom: Maximum 3 guests
• Additional bedrooms: +2 guests per bedroom
• Absolute maximum: 10 guests regardless of property size

Rental Duration Limits:

• Hosted rentals (owner present): No annual day limit
• Non-hosted rentals (owner absent): Maximum 180 days per calendar year

Tax Obligations:

• Transient Occupancy Tax: 10% on all rentals 30 days or less
• Business Tax: Annual payment required for business tax certificate
• Automatic collection: Airbnb and Vrbo collect and remit TOT automatically
• Direct bookings: Host responsible for TOT collection and remittance

Safety and Operational Requirements:

• Functional smoke and carbon monoxide detectors mandatory
• 24/7 local contact person when host absent (must respond within 1 hour)
• Written neighbor notification for non-hosted operations
• Compliance with all building codes and safety standards

Prohibited Activities:

• No commercial events or parties
• No subletting to third parties for STR operations
• No operation in accessory dwelling units
• No multiple STR properties per owner within city limits

State-Level California Regulations

Fee Transparency Requirements:

• Display total rental price upfront including all mandatory fees
• Transparent disclosure of cleaning charges and penalties
• Clear listing descriptions of all guest obligations

Guest Cancellation Rights:

• 24-hour penalty-free cancellation for bookings made 72+ hours before check-in
• Refunds must be processed to original payment method
• Non-compliance penalties up to $10,000

Additional State Requirements:

• Assembly Bill 537: Guest cleaning penalty restrictions
• Senate Bill 644: 24-hour cancellation refund requirements
• Civil Code Sections 1748.40 and 1780.80: Price transparency mandates

Contact Information for Local STR Authority

Primary STR Regulatory Contact:

Department of Planning, Building, and Code Enforcement

• Phone: (408) 535-3555
• Website: San Jose Planning Department

Business Registration and Tax:

Finance Department - Business Tax Division

• Phone: (408) 535-7027
• Website: Business Tax Registration
• Email: Contact through website portal

Housing Department (for rent stabilization inquiries):

Housing Department

• Phone: (408) 975-4480
• Email: RentRegistry@sanjoseca.gov
• Website: San Jose Housing Department

Transient Occupancy Tax:

Finance Department - Tax Division

• Phone: (408) 535-7027
• Website: Hotel Taxes Forms

Source Links and Additional Resources

Primary Source Documents:

• San Jose Municipal Code Section 20.80: Municipal Code STR Regulations
• Airbnb San Jose Rules: Official Airbnb San Jose Guidelines
• Business Registration Portal: San Jose Business Tax Registration

Additional Reference Sources:

• Steadily Insurance STR Guide: San Jose STR Laws and Regulations
• Truvi Legal Overview: San Jose Short-Term Rental Laws
• Housing Department Resources: Rent Registry Information

Important Disclaimers:

This guide provides general information based on available sources and should not substitute for professional legal advice. Regulations may change, and investors should verify current requirements with local authorities and consult qualified legal professionals before starting STR operations. The City of San Jose's official websites and municipal code represent the authoritative sources for current regulations.