Investment buyers ask me three things more than any others: can I still get a short-term rental permit, what does a second home actually cost to hold, and which of these Central Coast towns still pencils out. Here is where things stand this fall.
Short-term rentals in Paso Robles
Paso Robles caps non-hosted short-term rental permits at 325 citywide, with a smaller cap of 75 inside single-family zones. Both caps are currently full, and the city is not issuing new non-hosted permits except when an existing one expires or is surrendered. New applicants go on a waitlist with no guaranteed timeline.
There is one path that is not capped: hosted rentals, where the owner lives on the property and rents out a room or an accessory unit. If STR income is the goal and you are open to living on site part time, that route is open today.
Budget for the tax stack too. Paso Robles' transient occupancy tax runs 11 percent on its own, and combined with other assessments the total tax on a short-term rental stay reaches roughly 14.5 percent. Also know that permits here are tied to the operator, not the property, so an existing STR permit generally does not transfer to you when you buy the house.
Short-term rentals in Atascadero
Atascadero does not currently have a formal short-term rental permit ordinance. The city council has been working through a proposal, including a possible requirement that the owner live on site for single-family zoned properties, but I have not confirmed that an ordinance has been adopted as of this writing. If STR income drives your purchase decision in Atascadero, confirm the current rule with the city's planning department before you make an offer, not after.
Unincorporated San Luis Obispo County
Outside the city limits, the county allows vacation rentals with a zoning clearance and a business license. A new annual review fee for all short-term rentals took effect in January 2026, part of managing a market the county says has grown past 2,200 registered license holders.
Second homes
A second home is simpler on the regulatory side, since you are not applying for an STR permit at all, but the numbers still matter. Property tax, insurance, and upkeep run whether or not you are here, and a wine country second home often costs more to insure than a comparable primary residence inland. I walk every second home buyer through a real holding cost estimate before we write an offer, not after closing.
Long-term rental investment
Long-term rentals face none of the permit caps or waitlists above, and remain the more predictable path if steady cash flow matters more to you than peak season STR income. As an active investor in both short-term and long-term rentals myself, I look at both sides of that math with clients before we decide which property, and which strategy, actually fits.
Short-term rental rules change, and this reflects what I could confirm as of September 2026. Always verify current permit status directly with the relevant city or county planning department before purchasing for STR use.