Monterey short-term rental rules: the city bans them in neighborhoods, the county permits some
“Monterey” can mean the City of Monterey or the unincorporated county land around it, and the rental rules are opposite. Inside city limits, stays of less than 30 days are prohibited in residential zones. In unincorporated Monterey County, some homes can get a vacation rental license. Here is what the Monterey City Code and the County of Monterey say, and what it means if you are buying.
By Jonathan Balog, Broker Associate, Compass · Carmel-by-the-Sea · Facts checked Nov 12, 2026
The short version: In the City of Monterey, short-term residential rentals (less than a calendar month or 30 consecutive days) are prohibited in all residential districts, including Planned Community districts, unless they qualified for a limited grandfathering that began in 1991 and ended on sale or after five years. Lodging under 30 days is allowed only in areas zoned for visitor accommodation facilities. Fines for an illegal rental start at $1,500. Long-term rentals must be registered with the city each year. Outside city limits, Monterey County licenses some vacation rentals in single-family homes, with caps on commercial rentals by planning area.
The line
Stays under 30 consecutive days are short-term.
Cutoff
STRs set up after Aug 6, 1991 are prohibited.
First fine
For an illegal STR, per the 2025 fine schedule.
Hotel tax
City transient occupancy tax on lodging.
Inside the City of Monterey
The short answer: no new short-term rentals in residential zones.
What counts
The city’s zoning code defines a short-term residential rental as lodging for transient guests for less than a calendar month or less than 30 consecutive days. House swapping without rent is excluded.
Prohibited in residential districts
Monterey City Code 38-26(O) prohibits short-term residential rentals in all residential districts, including residential developments in Planned Community districts, if they were established after August 6, 1991 or did not qualify for the limited grandfathering.
The old grandfathering ended
Rentals that existed before August 6, 1991 had to register, pay hotel tax and agree to stop within five years or when the property changed hands, whichever came first.
Where it is allowed
The city’s Finance Department FAQ says short-term rentals of less than 30 days are not permitted anywhere except areas zoned for visitor accommodation facilities. Lodging there pays the 12% transient occupancy tax.
Owner away once a year
The definition exempts a rental by an owner-occupant who is temporarily away, as long as it happens no more than once in any 12-month period.
Guest houses and timeshares
A guest house cannot be separately rented, and a guest house use permit carries a recorded no-rent condition with an annual declaration. Vacation timeshare projects are prohibited in all zones.
Monterey City Code 38-26 ↗Monterey City Code 38-11 (definitions) ↗City TOT FAQ (PDF) ↗
Fines and advertising
The city raised its short-term rental fines in 2025.
Rental fines
City Council Resolution 25-009, adopted February 18, 2025, set the fine for violating the city’s short-term rental rules at $1,500 for a first violation, $2,250 for a second within 36 months, and $3,000 for a third and later violations in the same 36 months.
Advertising
Monterey City Code 22-19.5 makes it a violation to post or maintain an ad for a prohibited short-term rental, and each day is a separate offense. The fine schedule lists $250. Hosting platforms themselves are not the responsible party.
Monthly and long-term rentals in the city
Allowed, but registered.
30 days or more
Stays of 30 consecutive days or more fall outside the short-term rental definition.
Rental registry
Monterey City Code 8-2.02 requires landlords to register every rental unit covered by the city’s rental inventory program. Exemptions expired June 30, 2025. Registration renews each year, with payment due July 1 and a 20% late penalty after August 15.
What you report
Registration includes the landlord’s contact information, the unit’s size, occupancy status and current rent, and changes such as a new owner or a rent increase must be reported within 30 days.
Management
I co-own Peninsula Luxe, which manages luxury vacation, monthly and long-term rentals on the Monterey Peninsula, and some areas here allow only monthly stays.
Outside city limits: Monterey County’s vacation rental rules
Different rules for unincorporated areas near Monterey.
Where county rules apply
The county’s rules cover unincorporated Monterey County. The county says they do not apply inside city limits, naming Monterey, Pacific Grove, Carmel-by-the-Sea and other cities, which set their own rules.
Three types
A Homestay (owner present, primary residence), a Limited Vacation Rental (whole house, up to three times per 12 months) and a Commercial Vacation Rental (whole house, more often, which also needs a use permit or coastal development permit).
Who and what qualifies
Only detached single-family homes qualify, not condos, duplexes or ADUs. The county says owners must be individuals or a trustee of a trust, and commercial vacation rentals are capped by planning area.
Fees and timing
The county lists a total Vacation Rental Operation License fee of $1,152.40, plus possible Environmental Health fees, and says commercial rentals take four to five months to review on average.
Nearby examples
Pebble Beach and Carmel Valley are unincorporated. See Pebble Beach short-term rentals and Carmel Valley short-term rentals.
If you are buying in or around Monterey
The questions to answer before you count on rental income.
City or county?
A Monterey mailing address does not mean city limits. Confirm the jurisdiction for the parcel before anything else.
Inside the city
Plan on monthly or long-term rentals, and on registering the unit. Ask the seller whether the home was ever advertised as a short-term rental.
In the county
Check the zoning, the planning area cap, any HOA rules and whether the home is a detached single-family house.
Compare nearby towns
Every town here is different. See Carmel-by-the-Sea rental rules and Pacific Grove short-term rental rules.
Related guides
Other guides on this site that pair with this one.
- Monterey homes
- Buying a home in Carmel
- Buying a home in Carmel-by-the-Sea
- Buying a home in Pebble Beach
- Best real estate agent in Carmel
- Best real estate agent in Pebble Beach
- Carmel-by-the-Sea rental rules
- Pebble Beach short-term rentals
- Pacific Grove short-term rental rules
- Carmel Valley short-term rentals
Buying with rental income in the plan?
I can confirm whether a home is inside Monterey city limits, check its zoning and rental history, and run the numbers on monthly and long-term rents before you write an offer. If you are also weighing Carmel-by-the-Sea or Pebble Beach, the rental rules there are different again, and I can walk you through them side by side.
Monterey homesCarmel-by-the-Sea homesPebble Beach homes
Questions about a specific property?
Call or text 831-747-0310, or book a 30-minute call.
Before you rely on this
- City rules are from the Monterey City Code (current through Ordinance 3723, passed Sept 15, 2026), read Nov 12, 2026, the city’s TOT FAQ (last updated July 1, 2025) and Resolution 25-009. County rules are from the County of Monterey vacation rentals page, read Nov 12, 2026.
- County vacation rental litigation is ongoing, and the county has suspended some ordinance provisions. Check the county page for the current status.
- This is general information, not legal advice. Confirm the rules for any parcel with the City of Monterey or the County of Monterey.
Monterey short-term rentals: quick questions
Are short-term rentals legal in Monterey, CA?
Not in residential neighborhoods inside the City of Monterey. City Code 38-26(O) prohibits short-term residential rentals in all residential districts if established after August 6, 1991. The city’s Finance FAQ says stays under 30 days are allowed only in areas zoned for visitor accommodation facilities.
What is the fine for an illegal short-term rental in Monterey?
Under the city’s 2025 fine schedule, $1,500 for a first violation, $2,250 for a second within 36 months, and $3,000 for a third and later violations within 36 months. Advertising a prohibited rental is a separate violation.
Can I rent my Monterey home for 30 days or more?
Yes. Stays of 30 consecutive days or more are outside the short-term rental definition. The city requires landlords to register rental units each year.
Can I rent out my guest house in Monterey?
No. The city’s zoning code says guest houses shall not be separately rented, and a guest house use permit includes a recorded no-rent condition.
Do Monterey County vacation rental rules apply in the City of Monterey?
No. The county says its rules apply only in unincorporated areas, and cities like Monterey, Pacific Grove and Carmel-by-the-Sea set their own.
Can I rent my Monterey home while I am on vacation?
The city’s definition exempts a rental by an owner-occupant who is temporarily away, as long as it happens no more than once in any 12-month period.
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