Learn More About The Impact of Short-term Rental
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STR-related spending generates significant economic activity across California’s communities
In addition to accommodation, visitors spend their money at many different businesses, including restaurants, stores, recreational resources, and tourist attractions. As shown in Table 1, spending by visitors staying at STRs directly supported more than 175,000 jobs across California and generated $16 billion in economic output in 2019. These impacts ripple throughout the economy, generating additional activity through business supply chains and increased household spending. With the addition of these ripple (or secondary) impacts, STR-related spending supported 246,000 jobs and generated nearly $30 billion in economic output in California in 2019.
STR visitor purchases also generate significant tax revenue to support state and local governments
In 2019, STR-related spending generated $2.7 billion in state and local tax revenue, most of which (56 percent) supported local governments. For local governments, property taxes and taxes levied on visitor lodging—transient occupancy tax (TOT)—are critical sources of revenue that support various activities, such as infrastructure improvements, public parks, and environmental preservation.
More than 450 jurisdictions in California administer TOT, which is a critical revenue source for vacation destinations. In Indian Wells, Rancho Mirage, South Lake Tahoe, and Big Bear Lake, TOT makes up about 45 percent of general-purpose tax revenues. About $732 million was generated in TOT revenue as a result of STR-related spending in 2019 in California.
