Airbnb Says More Short-Term Rentals Will Boost L.A.’s Budget. Opponents Say It Won’t Work.

As Los Angeles gears up for a surge of tourists for this year’s FIFA World Cup and the 2028 Olympics, vacation rental giant Airbnb is urging the city of Los Angeles to legalize thousands of new short-term rentals. The company promises that the expansion will add more than $100 million in tax revenue to city coffers amid a severe budget crisis. But opponents say more short-term rentals will further strain an already limited housing supply. 

In a report issued this month, Better Neighbors LA, a coalition of housing activists and labor groups that monitor short-term rentals, countered the Airbnb proposal with its own revenue generating idea: Enforce the city’s existing home sharing law, cite violators and bring in tens of millions of dollars in fines that the group says the city has simply failed to collect. 

Beefed-up enforcement is a “simple fix for the city” that would “raise enormous amounts of money,” said Randy Renick, Better Neighbors LA executive director. “It’s also going to return thousands of affordable housing units to the market for long-term renters,” he said. (Disclosure: Renick’s law firm, Hadsell Stormer Renick & Dai, is a financial supporter of Capital & Main.)
 

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Better Neighbors’ coalition includes the hotel workers union UNITE HERE Local 11, along with local organizations like Venice Community Housing and Strategic Actions for a Just Economy. (Disclosure: UNITE HERE is a financial supporter of Capital & Main.)

Last year, as Airbnb rolled out its “Save Our Services” campaign for short-term rental expansion, it poured $19 million into lobbying and political contributions at the state level, according to the California Secretary of State’s online database. Also in 2025, the company spent $360,000 on lobbying at Los Angeles City Hall and made hefty donations to charity at the request of L.A. city councilmembers, Los Angeles Ethics Commission records show. The company donated $570,000 to the nonprofit Salvadoran American Leadership and Educational Fund at the request of L.A. City Councilmember Traci Park and $25,000 to the North Valley Family YMCA at the request of Councilmember John Lee. California law places no limits on such donations, known as behested payments, but requires them to be disclosed to help the public identify attempts to influence public officials.

Airbnb wants the city to revive an idea that city councilmembers, including former councilmember Herb Wesson, the father of current Airbnb spokesperson Justin Wesson, first proposed eight years ago. The proposal would have allowed property owners to list second homes on platforms like Airbnb, Vrbo or booking.com. The current proposal would add up to about 31,000 units to the city’s short-term rental market. Under L.A.’s Home-Sharing Ordinance, which took effect in 2019, short-term rental hosts are allowed to list only their primary residences on vacation booking platforms. Neither Vrbo nor booking.com responded to Capital & Main’s request for comment about the proposal. 

The Airbnb-backed coalition, Save Our Services, says on its website that the additional vacation rentals could generate more than $100 million for the city in “bed taxes,” a 14% levy on overnight stays paid by hotel and short-term rental guests, as well as $100 million in sales tax revenue from tourist spending.

Labor unions like the Teamsters Joint Council 42, the Los Angeles/Orange Counties Building and Construction Trades Council and the International Association of Theatrical Stage Employees, along with the Central City Association of Los Angeles and community groups like the Brotherhood Crusade and the Koreatown Youth and Community Center, back the effort. 

Airbnb spokesperson Justin Wesson said in a statement, “By allowing a limited, regulated number of vacation rentals in the City of Los Angeles we can help stabilize funding for essential services, support neighborhood-based tourism, and prepare the city for upcoming global events in a way that benefits residents, visitors, and local businesses alike.”

Airbnb supports stronger enforcement of the city’s Home-Sharing Ordinance, Wesson wrote in a January 2026 letter to the L.A. City Council. The letter also urges the city to require all vacation rental platforms to share data with the city and remove illegal listings. Airbnb is the only company that currently does so voluntarily. 

The Better Neighbors LA report dismisses Airbnb’s claim that expanding short-term rentals would generate more than $100 million in new hotel taxes as “fanciful” because the proposal wouldn’t necessarily bring additional tourists to the city. In 2020, as the City Council first considered an expansion of the short-term rental market, Los Angeles Director of City Planning Vince Bertoni was also skeptical that expanding vacation rentals would draw visitors to Los Angeles. 

Still, the World Cup and the Olympics will bring an influx of visitors to L.A., and groups like Better Neighbors LA fear that the city will lose much needed housing to tourist rentals, especially if city officials permit additional vacation rentals. 

This concern is heightened by the fact that the city has long struggled to enforce its existing Home-Sharing Ordinance. 

Fully half of the Los Angeles vacation rentals listed on booking sites are illegal, according to data included in the Better Neighbors LA report. But only a tiny fraction of violators are cited; the city has collected a total of about $667,000 in fines under the 2019 home sharing law, Better Neighbors LA reports. The group estimates the city could immediately rake in $95 million in two months if it stepped up enforcement.

City Councilmembers Katy Yaroslavsky and Hugo Soto-Martinez, whose Hollywood-Silver Lake district has among the highest concentration of the city’s short-term rentals, support Better Neighbors’ plan to increase enforcement of the city’s current law.  

“This report makes clear that the path forward is enforcing the home-sharing laws already on the books,” Soto-Martinez said in a statement. “If we fully implement the rules we passed, we can protect tenants and generate additional revenue for the city without sacrificing housing.”

L.A.’s Home-Sharing Ordinance generally allows individuals to list only their primary residences on sites like Airbnb and Vrbo for up to four months, although the city also makes exceptions, allowing year-round “extended home sharing” in many cases. Home sharing is not permitted in dwellings covered by the city’s rent control law or in affordable housing units, including those built with public funds.  

But property owners have easily evaded the existing home sharing law, even amid a severe housing and homelessness crisis. In 2024, a Capital & Main and ProPublica investigation found that tourists could rent apartments in dozens of rent controlled buildings in apparent violation of the law. Owners of some of these buildings openly listed fabricated or nonexistent city registration numbers and were never cited. 

For years, residents complained about loud parties in short-term rentals, parking problems and the loss of permanent housing in their neighborhoods. Last March, the City Council finally voted to pursue reforms, including requiring short-term rental platforms to use a computer system that would automatically block illegal transactions and giving individuals the right to sue suspected short-term rental law violators. But the reform effort hasn’t moved forward. 

Last year as the City Council considered stricter oversight of short-term rentals, Los Angeles Housing Department officials said they lacked the staffing and resources to effectively enforce the ordinance. This month, Sharon Sandow, a spokesperson for the housing department, which is one of several city agencies overseeing the Home-Sharing Ordinance, said in an email that all of the departments would have to assess their “resources and capacity” for a coordinated enforcement effort. 

Meanwhile, the Airbnb proposal has caught the attention of at least one city councilmember, Heather Hutt, who represents Koreatown and Mid-City. In January, Hutt requested that the chief legislative analyst and other city department staff brief the City Council’s budget and finance and planning and land use committees on the status of the ordinance.  

Support for the Airbnb plan would represent a distinct shift for most members of the City Council: Last year, councilmembers put themselves squarely on the side of limiting short-term rentals in the city, voting 12-0 to strengthen oversight of the program. Three members — John Lee, Monica Rodriguez and Bob Blumenfield — were absent.

Copyright 2026 Capital & Main