When considering a luxury home purchase, there are many factors to consider. Some of these factors will depend upon whether you plan to live in the home on a full-time basis or if you plan to rent it out on occasion. If you are looking at your luxury home purchase as a way to make money when you are not using it, it is important to know the regulations that are in place within the city where you plan to purchase the home as well as within the neighborhood. One area of Southern California where you may now want to avoid purchasing a luxury home as an investment is Anaheim, where the city council has voted to temporarily stop short-term rentals of property.
Problems Associated with Short-Term Rentals
It is no secret that purchasing a property and renting it out on occasion as a short-term rental is a great way to generate cash flow. Depending upon the popularity of your short-term rental, you may be able to cover the mortgage cost while also earning a profit. On the other hand, for those who live in the community where your short-term rental is located, the practice of renting out properties can become a problem. This is the case in Anaheim, where residents have been complaining about increased noise and the influx of tourists in those neighborhoods that are located near Disneyland and Angel Stadium. Furthermore, the practice of purchasing homes in order to make them a short-term rental takes needed housing off of the residential market, thereby reducing housing options for residents while also disrupting the formation of cohesive neighborhoods.
There is also mounting evidence that short-term rentals are costly to cities. For example, the Anaheim Police Department registered approximately 300 calls to investigate short-term rentals in 2014. More than 100 of these calls were associated with complaints of loud parties or other disturbances, while 50 were about parking or traffic problems.
The Anaheim City Council Takes Action
In response to concerns about the number of tourists and increased noise in certain parts of the city, the Anaheim City Council voted 4-1 to approve an “urgency ordinance” that would stop new applications for rentals for 45 days. By putting the moratorium in place, city officials say they can study the new regulations and determine what additional steps may be necessary to resolve the concerns of residents. Currently, one proposed option is to increase the $250 annual registration fee that is currently being charged to homeowners who are renting their properties. The report is due back to the City Council on October 20, but the ordinance comes with the option to extend the moratorium in order to provide additional time to study the situation if necessary.
Of course, tourism is a major source of income for the city of Anaheim. With 150 hotels offering nearly 20,000 rooms, hotel taxes generated about $110 million for the city in 2014, representing more than 40 percent of its general fund revenue. Furthermore, nearly 400 homes and apartments are rented on a short-term basis in Anaheim, with the city receiving five to ten applications per week for new rentals.
Whether you are interested in an investment property or you wish to purchase a luxury property for yourself, our team of real estate experts will be happy to help you find the best homes within the most exclusive neighborhoods that Southern California has to offer.
Look into these amazing properties below in the bustling city of Los Angeles priced from $2 Million to $5 Million.
$2,500,000 : 8638 FRANKLIN Avenue, Los Angeles3 beds, 4 baths
$2,849,000 : 7546 DEVISTA Drive, Los Angeles4 beds, 4 baths
$2,748,000 : 605 HANLEY Way, Los Angeles4 beds, 3 baths
$2,900,000 : 1701 N COMMONWEALTH Avenue, Los Angeles0 beds, 0 bath
$3,100,000 : 3827 EVANS Street, Los Angeles0 beds, 0 bath
See all City of Los Angeles Luxury Homes For Sale.
(all data current as of 11/22/2017)
Listing information deemed reliable but not guaranteed. Read full disclaimer.