Short Term Rental Rules in the Central Valley: A City by City Guide

California does not issue a statewide short term rental permit. There is no single license, no single tax rate, and no single set of rules. Everything that matters is decided by the city your property sits in, which is why an owner in Turlock can list a whole house tonight with a business license, while an owner four freeway exits away is working from an entirely different rulebook.

We manage properties across this valley, and this is the question we field more than any other: am I allowed to do this at my address? So we pulled the ordinances for the nine cities we work in most and wrote down what each one actually says.

One thing before the list. Every ordinance in this guide turns on the same number: thirty days. Almost without exception, a California city defines a short term rental as lodging rented for thirty consecutive days or fewer. Stays of thirty one nights and longer fall outside that definition entirely and land in ordinary rental territory. That single line is the reason a restricted city is still a very good place to own a rental, and we come back to it at the end.

The Quick Answer

Tax rates and fees move. Treat this table as the map, then confirm the current numbers with the city before you list. Checked September 2026.

Modesto

Modesto has no dedicated short term rental ordinance. There is no cap on nights, no separate vacation rental permit, and no rule forcing you to live in the property. The city handles nightly rentals through the same machinery it uses for hotels.

What you need is a Transient Occupancy Registration Permit from the Tax Administrator, which the city requires to be in effect at all times while the property is operating, plus a home business license. The transient occupancy tax is 9% of the rent charged, and it is on you to collect it from the guest and remit it. Airbnb does not collect and remit it for you in Modesto, which catches a lot of new hosts in their first quarter.

Modesto is the most straightforward whole-home market in the valley for a first time host, and it is our busiest. See what Modesto properties are earning.

Turlock

Turlock never wrote a short term rental ordinance at all. The city's own permit index runs long, covering everything from bingo games to massage to mobile food vendors, and there is nothing on it for a short term rental, a vacation rental, or a transient occupancy permit.

That leaves two obligations. Every business operating inside city limits needs a Turlock business license, and you register with the Finance Division for the transient occupancy tax, which lives in the chapter of the municipal code still titled Hotel and Motel Taxes. As in Modesto, expect to collect and remit the tax yourself.

With Stanislaus State on the north side of town, Turlock also carries steady demand for furnished stays longer than a month, which makes it a natural blended market. See the Turlock market.

Tracy

Tracy has no dedicated short term rental ordinance either, so a whole home listing is governed by general zoning rather than by a vacation rental chapter. You will need a City of Tracy business license and you will owe the city's transient occupancy tax on stays of thirty days or fewer.

Tracy is the strongest commuter market on this list. It sits at the mouth of the Altamont, which means weekday corporate demand and weekend Bay Area overflow in the same calendar. See the Tracy market.

Stockton

Stockton has no separate short term rental permit and no ordinance capping or banning nightly rentals. Hosts operate under general zoning with a city business license, and the city's transient occupancy tax applies to stays of thirty days or fewer.

Two things worth knowing in Stockton. The city runs a Residential Rental Inspection Program on the code enforcement side, so confirm where your property stands with that program before you start turning guests. And unincorporated San Joaquin County addresses with a Stockton mailing address are not governed by the city code at all. The county has its own accessory short term rental rules, so the mailing address is not the test. Your jurisdiction is. See the Stockton market.

Merced

The City of Merced has no dedicated short term rental ordinance, so a whole home listing is not zoned in or out by name. A business license and the city's transient occupancy tax on stays under thirty days are the requirements.

Merced County is the part people miss. The county zoning code takes a very different line for unincorporated addresses, requiring that a short term rental be the owner's primary residence and keeping them out of certain non-residential zones. If your property is outside city limits, read the county code, not the city's.

Merced gets a demand profile the rest of the valley does not, driven by UC Merced and by Yosemite traffic through the 140 corridor. See the Merced market.

Patterson

Patterson has no published short term rental ordinance. The city requires a business license for any business operated from a residence, and it collects a hotel tax, so the registration side is where your questions belong. Call the Finance Division, get your business license, and ask directly how they want a nightly rental registered for transient occupancy tax.

This is home for us. We live here, our crews start their mornings here, and we know the neighborhoods block by block, from Villages of Patterson to the I-5 corridor. See the Patterson market.

Manteca

Manteca is the first city on this list with a real short term rental chapter, adopted by the City Council in January 2022 and living in Chapters 3.40 and 3.42 of the municipal code. The shape of it is specific.

Short term lodging permits are issued in R-1, R-2 and R-3 zones only. The rental has to be inside the owner's primary residence, and the city expects the owner to actually live there most of the year. You may rent up to two rooms per unit. Renting out the entire unit is prohibited, and a tenant cannot host at all. You need the short term lodging permit plus a city business license before you advertise, and the ordinance requires your city registration number to appear in the listing. The city also brought in a revenue firm to match live listings against the permit roll, so enforcement here is real rather than theoretical.

That is not a closed door, it is a different door. An owner occupied two room operation in Manteca performs well, and for a property you do not live in, the midterm route below is the one we use. Manteca has Great Wolf Lodge traffic, Oakwood Shores, and a steady stream of families relocating into Union Ranch. There is demand here. See the Manteca market.

Atwater

Atwater is the one address in this guide where we tell owners to make a phone call before doing anything else. The city has no published short term rental ordinance, and city staff have previously taken the position that short term lodging was not an allowed use under the existing code. We have not found a later ordinance that settles it.

So call the city, ask for planning, and get the current answer in writing along with your business license and zoning clearance. Atwater sits next to Castle Commerce Center and draws contractor and travel medical demand out of Merced County, and furnished stays of thirty one nights or longer sidestep the nightly question completely. See the Atwater market.

Lathrop

Lathrop is the clearest rule in the valley, and the one most often gotten wrong.

In March 2024 the City Council adopted Chapter 5.10 of the Lathrop Municipal Code, titled Short Term Rental Prohibition. It defines a short term rental as a use that provides lodging in a single family or multi family dwelling unit, for compensation, for a period of thirty or fewer consecutive calendar days. Section 5.10.030 then says it plainly: a short term rental is expressly prohibited within the City limits. The chapter also declares a violation a public nuisance the city can abate summarily. City approved hotels are carved out. Nothing else is.

Here is the part that gets missed, and it matters a great deal if you own in River Islands. The prohibition is written against a thirty day ceiling. A furnished stay of thirty one nights or longer is not a short term rental under that definition, which is exactly why a midterm strategy is the right answer in Lathrop rather than a reason to sit out. River Islands is one of the strongest furnished rental submarkets we operate in, and it fills with travel nurses, relocating families waiting on a close, and project crews on multi month assignments.

Confirm your own situation with the City of Lathrop before you list anything. See the Lathrop market.

When Nightly Is Restricted, Thirty One Nights Changes Everything

Read back through the list and you will notice that even the strictest cities here drew their line at thirty days. That is not an accident. Cities regulate transient lodging. They do not regulate ordinary furnished tenancies, because those were never the thing anyone was complaining about.

So in Lathrop, in Manteca on a property you do not live in, and in Atwater while you wait on an answer, the furnished midterm rental is the strategy. Thirty one nights and up, fully furnished, utilities included, one tenant at a time. The guest profile is excellent:

• Travel nurses and traveling allied health staff on thirteen week contracts
• Insurance placements, where a carrier houses a family for months while a home is repaired
• Relocating professionals and families waiting on escrow to close
• Construction, energy, and logistics crews on project assignments
• Corporate and government staff on temporary duty

Nightly rates are lower than peak short term, but so is your turnover cost. One clean every few months instead of ten a month, far less linen, fewer supply runs, a calendar you can actually plan against, and no exposure to the nightly ordinance question at all. On the properties where we run this well, the annual net lands closer to a strong short term year than most owners expect.

We do not treat this as a consolation prize, and we do not treat short term and midterm as an either or choice. The best performing properties we manage move between both by season and by market.

Four Things Every Central Valley Host Needs, Whatever the City Says

A business license. Every city on this list requires one. It is the cheapest piece of compliance you will ever buy and the easiest one to be caught without.

Transient occupancy tax registration. Assume you are collecting and remitting it yourself. Airbnb collects and remits automatically in some California jurisdictions and not in others, and in most of this valley the obligation stays with you. Getting this wrong is expensive and it compounds quietly.

Your HOA documents. This one ends more plans than any city ordinance. California Civil Code section 4741(c) allows a common interest development to prohibit rentals of thirty days or less even while it cannot stop you from renting long term. Your city can say yes and your HOA can still say no. Read the covenants first, particularly in River Islands, Oakwood Shores, Mountain House, Brookside, and Bellevue Ranch.

The right insurance. A standard homeowners policy is not written for paying guests. You want a short term rental or landlord policy with liability that matches the use, and if you are running midterm stays, confirm your carrier understands the difference.

How We Handle This For Owners

Compliance is part of onboarding for every property we take on. We confirm the jurisdiction, which is not always the mailing address, pull the current ordinance, get the business license and tax registration filed, and then build the strategy around what the city actually allows rather than around what we wish it allowed.

Sometimes that means a whole home nightly listing in Modesto or Tracy. Sometimes it means an owner occupied two room setup in Manteca. In Lathrop it means a furnished midterm program aimed at River Islands demand. There is a way to make nearly every property in this valley earn, and the ordinance decides the shape of the plan, not whether there is one.

If you own in the Central Valley and you want a straight answer for your specific address, we will pull the rules for your jurisdiction and tell you what we would do with it. No cost and no obligation.

Talk to us about your property.

This guide reflects what we found in city ordinances, city code, and published city materials as of September 2026, and it covers the cities we operate in most. Ordinances change, sometimes quickly. It is information, not legal advice. Confirm your own situation with your city before you list, and talk to an attorney if the answer carries real money for you.