Can You Rent Out Your ADU on Airbnb in California?

Accessory Dwelling Units (ADUs) have emerged as one of California’s most popular housing solutions, offering homeowners a way to add livable space and generate income. As platforms like Airbnb continue to attract millions of travelers, many property owners are exploring whether they can legally rent out their ADUs as short-term rentals.

But the rules around short-term rentals in California are far from simple. While the state encourages ADU development, local cities often impose their own restrictions when it comes to listing them on platforms like Airbnb. Whether you’re a homeowner looking to maximize your property or a real estate investor evaluating options, understanding the intersection of ADU laws and Airbnb regulations is essential.

This guide breaks down everything you need to know, from state-level legality to local ordinances, potential earnings, alternatives, and what features your Airbnb-ready ADU should include.

Why Are ADUs on the Rise?

California’s housing shortage and rising living costs have made Accessory Dwelling Units (ADUs) an increasingly attractive solution for both homeowners and policymakers. These secondary housing units — whether built in a backyard, above a garage, or as part of a home conversion — offer flexible, relatively affordable housing without requiring new land.

Several legislative changes have also fueled this growth. State laws like SB9, SB13, and AB68 have removed barriers to ADU construction, streamlined permitting processes, and limited the ability of local governments to block or delay projects. As a result, it’s now easier and faster than ever to build an ADU on a residential property.

For homeowners, ADUs present an opportunity to:

Generate rental income
Increase property value
Create multi-generational housing
Provide flexible living space for remote work or guests

Combined with growing interest in short-term rental platforms like Airbnb, it’s no surprise that thousands of Californians are looking at ADUs as income-producing assets.

Is it Legal to Rent Out Your ADU on Airbnb in California?

At the state level, California does not prohibit renting out ADUs on Airbnb or other short-term rental platforms. However, that doesn’t mean it’s automatically legal everywhere, local city and county governments have the final say when it comes to short-term rental (STR) rules.

California’s ADU laws like AB68 and SB13 focus on expanding housing access, not regulating how ADUs are rented. These laws permit ADUs for residential use, but short-term use (under 30 days) is often governed by local ordinances, zoning codes, and permit requirements.

Some cities allow short-term rentals of ADUs with proper registration, while others ban Airbnb listings entirely unless the unit is your primary residence or is rented for at least 30 consecutive days.

Key legal considerations:

State law permits residential use but defers to local STR rules.
Most cities define short-term rentals as stays under 30 days.
Many localities require a business license, STR permit, or host registration.
Violation of local laws can lead to fines or forced delisting.

So while it may be technically legal to list an ADU on Airbnb under state law, you must comply with your city or county’s specific short-term rental regulations to avoid penalties.

Local Laws That Impact Airbnb ADU Rentals

While California supports ADU development statewide, short-term rental regulations are set and enforced at the local level. This means whether or not you can list your ADU on Airbnb depends entirely on the city or county where your property is located.

Local governments often impose rules to balance tourism with residential housing needs. These rules may regulate:

Whether ADUs can be rented short-term
How often can they be rented
Whether the owner must live on-site
The maximum number of days per year allowed.
Registration and licensing requirements

ADU Airbnb Regulations in Major California Cities

1. San Jose Airbnb Rules for ADUs

San Jose aligns with California’s state law, requiring ADUs used for short-term rentals to offer stays of 30 days or longer. Here’s a breakdown of the city’s policy:

Length of stay: Minimum 30 days for Airbnb and similar platforms

Guest limits (Host present):

3 guests per single-family dwelling
2 guests per unit in multi-family homes

Guest limits (Host absent):

Max 180 days per year
2 guests in a studio
3 in a one-bedroom + 2 per additional bedroom (max 10 total)

Permits: No STR permit required, but you need a business license and must pay business taxes

Taxes: 10% Transient Occupancy Tax (TOT), automatically collected and remitted by Airbnb.

2. Los Angeles Airbnb Rules for ADUs

In Los Angeles, renting your ADU on Airbnb is legal only if the ADU is on your primary residence property, meaning you must live on-site at least six months per year. Key highlights include:

Eligibility: No rent-stabilized units, income-restricted housing, or properties with pending citations

Permit Requirements:

Rentals of 30+ days: No permit needed
Rentals under 30 days: You must register for a Home-Sharing Permit under LA’s 2019 ordinance

Permit Cost:

$192/year for standard home-sharing
$1,030 for extended home-sharing (as of mid-2023)
TOT Tax: 14% Transient Occupancy Tax + $3.10/night administrative fee (Airbnb collects & remits)
Owner vs. Renter Hosting: Both can apply, but renters need notarized permission from the property owner

3. Santa Clara Airbnb Rules for ADUs

Santa Clara also restricts ADU rentals on Airbnb to stays of 30 days or more, making short-term listings legal if you meet the minimum stay requirement. Notable details:

Regulation status: Few specific STR laws currently in place

TOT requirements:

Hosts must collect and remit Transient Occupancy Tax
Rate is 11.5%, increasing to 12.5% starting Jan 1, 2024

Permit requirements: No STR-specific license currently required

What to Know Before Listing Your Accessory Dwelling Unit (ADU) on Airbnb?

Before listing your Accessory Dwelling Unit (ADU) on Airbnb in California, you must check your local city and county zoning and short-term rental laws, as these vary widely and can include outright bans, permits, restrictions on duration, or require the owner to reside on-site.

Steps to Take Before listing your ADU on Airbnb :

Contact Your Local Government
Understand Local Short-Term Rental Ordinances
Check for Permits and Licenses
Inquire About Specific ADU Regulations
Review HOA Bylaws
Consider Insurance and Taxes

Failure to comply can result in fines, permit revocation, or legal action. Some cities also require compliance with building codes and inspections for ADU eligibility.

Alternatives to Airbnb for Your ADU

If local short-term rental regulations prevent you from listing your ADU on Airbnb, you still have several viable options to generate income from your unit — legally and reliably. In fact, some alternatives offer greater stability and less operational hassle.

Mid-Term Rentals

Best for: Traveling nurses, corporate workers, and remote professionals

Platforms: Furnished Finder, Zumper
Length of stay: 30+ days (complies with most local STR restrictions)
Benefits: Consistent income, lower guest turnover, fewer legal hurdles

Traditional Long-Term Rentals

Best for: Homeowners seeking passive income

Platforms: Zillow Rentals, Craigslist, HotPads
Length of stay: 6–12 months or longer
Benefits: Predictable cash flow, no need to furnish, avoids TOT taxes.
Consideration: May fall under rent control or tenant protection laws depending on your city

Specialty Housing Use-Cases

Student housing (near colleges/universities)
Insurance housing (for displaced homeowners — check with local insurers)
Relocation housing (for families transitioning between homes)

Choosing the right rental model depends on your local regulations, risk tolerance, and income goals. Many ADU owners opt for mid-term rentals as a legal and profitable middle ground when Airbnb isn’t an option.

Ready to Build or Upgrade Your ADU in Los Angeles?

Whether you’re planning to list your ADU on Airbnb or explore other rental opportunities, design and build quality play a major role in rental income, guest satisfaction, and long-term value.

If you’re in Los Angeles and want a turnkey solution, Lux Development offers custom ADU construction services tailored to short-term and long-term rental needs. Their team handles everything from architectural design and permitting to high-end construction that meets all California code and STR compliance standards.

Services Include: