How Much Money Can You Really Make with a San Diego Airbnb in 2026

The idea of earning passive income from a San Diego vacation rental sounds appealing, but what can you actually expect to make in 2026? The answer depends on far more than just buying a property and listing it online. Your neighborhood, property type, design quality, management approach, and compliance with San Diego's regulations all dramatically impact your bottom line. Some San Diego Airbnb hosts are pulling in over $13,000 monthly, while others struggle to break $2,400. Understanding what drives these differences helps you make smarter investment decisions and set realistic income expectations for your vacation rental.

Considering a San Diego Airbnb investment or want to maximize what your current property earns? Contact us for a detailed income projection based on your specific property or call 619-738-6199.

The Real Numbers: What San Diego Hosts Actually Earn

Based on 2025 data from 8,885 active listings projecting into 2026, San Diego Airbnb hosts average around $59,329 in annual gross revenue. That translates to roughly $4,944 monthly before expenses. However, this average masks huge variations between top performers and struggling properties.

The median monthly earnings sit at $4,576, with hosts achieving about 55% occupancy at an average daily rate of $255. These numbers represent the middle of the pack—half of all hosts earn more, half earn less. But the spread between top and bottom performers is massive.

Here's how San Diego Airbnb revenue breaks down across performance tiers:

Performance Tier	Monthly Revenue	Occupancy Rate	Average Daily Rate
Top 10%	$13,000+	86%+	$733+
Top 25%	$7,966+	75%+	$444+
Median (50th percentile)	$4,576	55%	$255
Bottom 25%	$2,396	33%	$155

The top 10% of San Diego properties earn nearly six times what the bottom 25% makes. This isn't random luck—it's the result of better locations, superior design and photography, professional management, strategic pricing, and strong guest experiences that generate positive reviews.

Understanding Gross vs. Net Revenue

Those revenue numbers represent gross income before expenses. Your actual profit—what you keep after all costs—is considerably less. Most San Diego vacation rental operators see net profits of 50-70% of gross revenue after accounting for all expenses.

Let's break down typical costs that eat into your gross revenue:

Transient Occupancy Tax (TOT): San Diego charges 10.5% TOT on all bookings under 30 nights. Most coastal properties also pay an additional 2% Tourism Marketing District assessment, bringing total tax to 12.5%. On $4,576 in monthly gross revenue, that's $572 going straight to the city before you see a dime.

Platform Fees: Airbnb typically charges hosts 3% of the booking subtotal. Vrbo charges either 8% per booking or an annual subscription fee. If you're listed on multiple platforms, these fees add up. Budget around 3-5% of gross revenue for platform costs.

Cleaning Fees: Professional cleaning between guests runs $100-200+ depending on property size. At 55% occupancy with an average 3-night stay, you're cleaning roughly 5-6 times monthly. That's $500-1,200 in cleaning costs alone.

Utilities: You're covering electricity, gas, water, trash, and internet for your property. Vacation rentals use more utilities than typical residences because guests don't conserve like homeowners do. Budget $200-400 monthly depending on property size and season.

Maintenance and Repairs: Things break constantly with high turnover. HVAC systems work harder, appliances get more use, and guests aren't always gentle. Set aside 5-10% of gross revenue for ongoing maintenance and repairs.

Supplies and Amenities: Toiletries, paper products, coffee, laundry detergent, dish soap—these costs seem small but add up quickly. Budget $100-200 monthly for guest supplies.

Property Management: If you hire a management company (typically charging 20-30% of gross revenue), this becomes your largest expense. However, professional management usually increases your gross revenue enough to more than offset the cost.

Insurance: Short-term rental insurance costs more than standard homeowner policies. Expect $150-300 monthly for proper coverage including liability protection.

STRO License and Permits: Your STRO license costs $1,170 for two years ($48.75 monthly) for Tier 3 or 4 properties. Add in TOT certificate costs and business license fees.

HOA Fees: If your property has HOA dues, those continue regardless of rental income.

Let's look at a realistic example using median performance:

Item	Monthly Amount
Gross Revenue	$4,576
TOT/TMD (12.5%)	-$572
Platform Fees (4%)	-$183
Cleaning (6 turnovers × $150)	-$900
Utilities	-$300
Maintenance (7% reserve)	-$320
Supplies	-$150
Insurance	-$200
Licenses/Permits	-$50
Net Operating Income	$1,901

That's a 41.5% net margin before considering your mortgage, property taxes, and property management fees if applicable. If you self-manage and own the property outright, that $1,901 is your monthly profit. If you have a mortgage and hire management, your actual cash flow could be break-even or negative despite generating nearly $55,000 in annual gross revenue.

How Seasonality Affects Your Income

San Diego vacation rentals experience significant seasonal fluctuations. Unlike some year-round markets, your monthly revenue will swing considerably between peak summer months and slower periods.

Peak Season (June-August): Summer brings the highest demand and best performance. Properties average 61.7% occupancy with $422 average daily rates, generating approximately $8,671 in monthly gross revenue. Families on summer vacation, convention attendees, and tourists fleeing hotter inland cities all drive demand during these months.

Shoulder Season (March-May, September-October): Spring and early fall maintain decent performance with moderate weather and events like Comic-Con in July drawing visitors. Expect occupancy around 55-58% with ADRs of $280-320, generating $5,500-6,500 monthly.

Low Season (January-February, November-December): Winter months see the biggest drop. Average occupancy falls to 48.6% with ADRs around $331, bringing monthly revenue down to approximately $4,695. Holiday periods (Thanksgiving, Christmas, New Year's) create brief spikes, but January and February are particularly slow.

This seasonality affects your annual planning and cash flow management. You can't assume that summer performance continues year-round. Top-performing properties minimize seasonal swings through strategic pricing and targeting specific guest segments during slower periods (remote workers, couples seeking winter getaways, etc.).

Neighborhood Performance Differences

Where your property is located dramatically impacts earning potential. San Diego's diverse neighborhoods attract different guest types and command different rates.

Gaslamp Quarter: Downtown's entertainment district attracts convention-goers, bachelor/bachelorette parties, and tourists who want walkable nightlife. Properties here maintain strong occupancy but face more wear-and-tear from party-oriented guests. Average ADRs run $300-450 depending on property quality.

La Jolla: The premium coastal neighborhood commands the highest rates in San Diego. Luxury properties with ocean views can exceed $733 average daily rates. La Jolla attracts affluent travelers, families wanting beach access, and couples celebrating special occasions. Occupancy may be slightly lower than urban areas, but higher nightly rates compensate.

Mission Beach: Family-friendly boardwalk location with strong summer demand. Properties here perform exceptionally well June through August but see bigger drops in winter. Average ADRs run $250-400 with peak summer rates much higher. The Tier 4 license cap (currently at zero availability) means existing properties face limited competition.

Pacific Beach: Similar to Mission Beach but with a younger, more party-oriented crowd. Strong summer performance, decent shoulder seasons, but winter can be challenging. Properties average $225-375 depending on proximity to the beach and property condition.

North Park: Central urban location with craft beer and restaurant scene appeal. These properties attract younger professionals and food-focused travelers. Average ADRs run $200-300 with more consistent year-round occupancy since they're not beach-dependent.

South Park: Upscale neighborhood near Balboa Park commanding $225-325 nightly rates. Attracts couples and small groups who appreciate the food scene and walkable amenities. Strong year-round performance with proximity to the zoo and museums.

Normal Heights: More affordable option attracting budget-conscious travelers and younger guests. ADRs typically $175-250 with good occupancy if priced competitively. Lower entry costs for investors but also lower revenue potential.

What Drives Top Performer Success

The properties earning $13,000+ monthly aren't just lucky with location. They excel across multiple factors that compound to drive superior performance:

Professional Photography: Top properties invest in professional photography that makes listings stand out. The difference between iPhone photos and professional shots directly impacts booking conversion rates. When guests browse 50+ listings, professional photos make yours stop their scroll.

Interior Design: Well-designed spaces photograph better, generate more bookings, and command premium rates. Our interior design team has helped properties increase their ADR by 20-30% simply by updating furniture, adding color, and creating Instagram-worthy spaces that guests want to share.

Amenities: Top performers provide amenities guests value—fast WiFi, smart TVs with streaming, fully equipped kitchens, comfortable beds with quality linens, outdoor spaces, and thoughtful touches like beach gear or bikes. These amenities justify higher rates and generate better reviews.

Reviews and Ratings: Properties with 4.8+ star ratings and dozens of positive reviews get prioritized in search results and convert browsers into bookers at much higher rates. Top performers focus relentlessly on guest experience to maintain excellent ratings.

Dynamic Pricing: The best-performing properties don't set their rates once and forget them. They adjust prices daily based on demand, competition, events, and seasonality. This optimization captures maximum revenue during peak periods while maintaining occupancy during slower times.

Fast Response Times: Properties that respond to inquiries within minutes book at much higher rates than those taking hours or days. Top hosts (or their management companies) monitor messages constantly and jump on every potential booking.

Strategic Marketing: Beyond just listing on Airbnb and Vrbo, successful properties maintain their own websites, collect direct bookings to avoid platform fees, and market to repeat guests through email lists.

The Impact of San Diego's STRO Regulations

San Diego's licensing caps significantly affect earning potential. The Tier 3 whole-home license cap limits total properties to 1% of the city's housing stock. As of November 2025, only 896 Tier 3 licenses remain available out of the cap. Mission Beach's Tier 4 has zero licenses available with a closed waitlist.

These supply constraints support higher nightly rates and better occupancy for licensed properties. In markets without caps, competition drives rates down as more properties enter the market. San Diego's caps prevent this oversupply, protecting existing operators' revenue.

However, the caps also mean property values for licensed properties trade at premiums. A property with an existing Tier 3 license is worth more than an identical property without one, simply because new licenses may not be available when the cap is reached.

Realistic Scenarios Based on Investment Type

Let's examine realistic income scenarios for different investment approaches:

Scenario 1: Primary Residence, Tier 2 Home Sharing You live in your home but rent a room or the whole place when traveling:

Gross Annual Revenue: $25,000-35,000 (limited rental days)
Net Profit (65%): $16,250-22,750
Mortgage Offset: Significant help with housing costs
Time Investment: Moderate (guest communication, cleaning)

Scenario 2: Investment Property, Tier 3, Self-Managed You bought specifically for vacation rental income and manage yourself:

Gross Annual Revenue: $55,000-70,000 (median to above-median performance)
Operating Expenses (50%): -$27,500-35,000
Mortgage/Taxes/Insurance: -$24,000 (assuming $400K purchase, 20% down)
Annual Cash Flow: $3,500-11,000 (modest positive to decent)
Time Investment: High (constant management required)

Scenario 3: Investment Property, Tier 3, Professionally Managed Same property but with professional management:

Gross Annual Revenue: $70,000-85,000 (management increases revenue 20-25%)
Operating Expenses (50%): -$35,000-42,500
Management Fee (25%): -$17,500-21,250
Mortgage/Taxes/Insurance: -$24,000
Annual Cash Flow: -$6,500 to -$2,750 (negative but building equity)
Time Investment: Minimal (management handles everything)

Scenario 4: Top-Performing Property, Premium Location Well-designed property in La Jolla or prime Mission Beach with professional management:

Gross Annual Revenue: $120,000-150,000+
Operating Expenses (45%): -$54,000-67,500
Management Fee (25%): -$30,000-37,500
Mortgage/Taxes/Insurance: -$36,000 (higher purchase price)
Annual Cash Flow: $0-15,000 (break-even to strong positive)
Appreciation: Building significant equity in premium location

The Total Return Picture

Focusing solely on monthly cash flow misses the complete picture of vacation rental returns. Your total return includes:

Cash Flow: The monthly profit after all expenses and mortgage payments. This might be modest or even negative in early years, especially with professional management.

Principal Paydown: Your tenants (guests) are paying down your mortgage principal every month. On a $320,000 loan, you might be building $10,000-15,000 in equity annually through principal reduction.

Appreciation: San Diego real estate historically appreciates 4-6% annually. On a $400,000 property, that's $16,000-24,000 in annual appreciation. Premium neighborhoods like La Jolla often exceed this.

Tax Benefits: Vacation rental owners can deduct mortgage interest, property taxes, insurance, maintenance, depreciation, and other expenses. These deductions significantly reduce your taxable income.

Forced Appreciation: Strategic renovations and design improvements can increase your property's value beyond market appreciation. A $30,000 renovation might add $50,000-75,000 to property value.

A property generating $55,000 gross revenue with break-even cash flow still provides:

$12,000 annual principal paydown
$20,000 annual appreciation (5% on $400K)
$15,000 tax benefit value
Total annual return: $47,000+ (11.75% on $400K investment)

What It Really Takes to Succeed

Making strong income from a San Diego Airbnb requires more than buying a property and listing it:

Capital Requirements: Most lenders require 20-25% down for investment properties. On a $400,000 property, that's $80,000-100,000 plus closing costs. You also need reserves for furnishing ($15,000-30,000), initial supplies, and 3-6 months of expenses before revenue stabilizes.

Time or Management: Self-managing means constant availability for guest messages, check-in coordination, cleaning scheduling, maintenance issues, and neighbor relations. Professional management eliminates this time burden but costs 20-30% of gross revenue.

Risk Tolerance: Vacation rental income fluctuates month-to-month. You need reserves to cover slow periods and unexpected expenses. Properties don't always cash flow positively from day one.

Attention to Detail: Top performers obsess over guest experience, reviews, pricing optimization, and property presentation. Treating it like a hobby rather than a business produces hobby-level returns.

Compliance: Operating legally with proper permits, tax collection, and regulatory compliance is non-negotiable. Violations can shut down your operation and result in costly fines.

Setting Realistic Expectations

Can you make significant money with a San Diego Airbnb in 2026? Absolutely. Properties in the top 25% generate $95,000+ in gross annual revenue, and top performers exceed $150,000. After expenses, that can mean $30,000-70,000+ in annual profit depending on mortgage costs and management approach.

However, median performance generates around $55,000 gross with potentially modest or negative cash flow once all expenses are considered. Your total return (including equity buildup and appreciation) can still be attractive, but expecting immediate strong cash flow without significant capital investment or exceptional execution is unrealistic.

The investors who succeed with San Diego vacation rentals typically:

Buy in strong locations willing to pay premium prices
Invest significantly in design and furnishing
Use professional management or commit substantial time
Have adequate capital reserves to weather slow periods
Focus on guest experience and maintaining excellent reviews
Stay compliant with all regulations
View it as a business requiring active optimization

If you're willing to invest properly and execute well, San Diego vacation rentals offer excellent return potential in 2026. If you're looking for truly passive income with minimal effort, the reality probably won't meet your expectations.

Ready to get a detailed income projection for a specific San Diego property? At Stay Classy Homes, we provide realistic revenue estimates based on actual market data, help you optimize your property's earning potential through professional design and management, and handle all compliance requirements so you can focus on returns. Call us at 619-738-6199 to discuss your vacation rental investment goals and what you can realistically expect to earn.