Owning a Vacation Rental in Santa Cruz

Are you in the market for an investment property in Santa Cruz? If you’re considering entering the vacation rental market or want to stay compliant with the latest rules, here’s everything you need to know.

The Big Picture: Designated Areas and Permit Caps

Santa Cruz County has established three Designated Areas along the coast, each with its own cap on the total number of short-term rental permits. These areas are already at capacity, with waitlists in place for new permits:

1. Live Oak Designated Area (LODA)

• Covers the Yacht Harbor Special Community and parts of Live Oak south of East Cliff Drive and Portola Drive.

• Includes areas from 9th Avenue to 41st Avenue.

  
  

2. Seacliff/Aptos/La Selva Beach Designated Area (SALSDA)

• Covers Aptos, Seacliff, and La Selva Beach, stretching from Capitola’s city limits to Bonita Drive and San Andreas Road.

  
  

3. Davenport/Swanton Designated Area (DASDA)

• Includes the North Coast Planning Area around Davenport and Swanton, extending along Highway 1 and Swanton Road.

  
  

Additional Rules to Know

• Block Caps: Even if a spot opens on the permit waitlist, there’s a limit of 20% per block for short-term rental permits.

• No Permit Transfers: Permits don’t transfer with property sales. If you’re buying a home with an existing permit, you’ll need to apply for your own.

• Check Availability: Use this map to view existing vacation rentals and understand availability in your area.

  
  

Types of Short-Term Rental Permits

Santa Cruz County offers three categories of permits:

1. Vacation Rental Permit

• For the entire home.

• Not allowed on properties with Accessory Dwelling Units (ADUs).

• Permits are valid for 5 years.

2. Hosted Rental Permit

• For short-term rentals of 1-2 bedrooms, with the owner residing onsite during the stay.

• Capped at 250 permits countywide. Currently, no new hosted rental permits are available.

• Permits are valid for 5 years.

3. Bed and Breakfast Permit

• For hosted short-term rentals of 3-5 rooms in owner-occupied homes.

• Allowed in RA, RR, R-1, and RM Zone Districts, but not in Beach Residential (RB) zones.

  
  

Opportunities Outside Designated Areas

While Designated Areas are capped and waitlisted, there are still opportunities for non-hosted rentals outside these zones. Specific areas like Beach Drive in Aptos, condos on Rio Del Mar Blvd, and parts of Capitola Village have fewer restrictions.

Check out the detailed vacation rental map for exact locations and apply for a permit if you qualify.

What Does This Mean for You?

Navigating the updated short-term rental rules can feel overwhelming, but it also opens up opportunities to align your property with the new guidelines. Whether you’re already operating or just starting out, understanding these rules can help you maximize your investment while staying compliant.

Need Help? Let’s Chat!

If you have questions about short-term rental laws in Santa Cruz County—or need assistance applying for a permit—reach out anytime!

Text: 831-888-7530

Let’s work together to turn your property into the perfect vacation rental for Santa Cruz County’s visitors.