Where to Live in Monterey County: Towns Compared by Water, Services and Rules

By Matthew Martinez, Founder, CEO & Managing Broker, Diamond Real Estate Group. California DRE #01869679.

The most useful first question in Monterey County is where the water comes from. On the Monterey Peninsula, homes served by California American Water (Cal-Am) sit under a State Water Board order that bars new service connections from Carmel River water, so vacant lots and added units there face a hurdle that Salinas Valley towns do not. After water, narrow the map by jurisdiction (one of 12 cities or the unincorporated county), vacation rental rules, which range from capped to prohibited, and whether you are in the Coastal Zone.

This guide compares places only by housing types, jurisdiction, water and wastewater, transportation, local rules and ownership costs. It does not describe residents, safety or schools, and it gives no prices or market statistics. For listings, start on our Monterey County homes page.

City or unincorporated?

Monterey County’s 12 incorporated cities are Carmel-by-the-Sea, Del Rey Oaks, Gonzales, Greenfield, King City, Marina, Monterey, Pacific Grove, Salinas, Sand City, Seaside and Soledad. Everything else, including Pebble Beach real estate, Carmel Valley real estate, Carmel Highlands real estate, Big Sur real estate, Castroville real estate, Moss Landing real estate, Aromas real estate and the south county communities of Jolon real estate, Lockwood real estate, Bradley real estate and San Ardo real estate, falls under the County of Monterey’s Housing and Community Development department. Several unincorporated areas use a city mailing address, so confirm jurisdiction by parcel number; our unincorporated Monterey County page covers that check.

Town-by-town comparison

Sources for each column are in the sections below. Water and sewer columns describe typical service; confirm the provider for the exact parcel.

Water: the Cal-Am connection limit on the Monterey Peninsula

The State Water Board has ordered Cal-Am to stop unauthorized Carmel River diversions since 1995. Under its cease and desist order (Order WR 2009-0060, amended by Order WR 2016-0016), Condition 2 prohibits Cal-Am from diverting Carmel River water for new service connections, and for increased use at an existing address that results from a zoning or use change. For a buyer, that means a vacant Peninsula lot without an existing connection, or a plan to add a unit, may not be able to get new water service from Cal-Am while the condition stands.

That may change, but it has not yet. The State Water Board’s page says the Monterey Peninsula Water Management District applied in October 2025 to lift Condition 2, with a reinstatement trigger if supply and demand thresholds are crossed. Hearing steps ran through 2026, with public comment set for November 5 and closing briefs due November 10, 2026; as of the page’s October 13, 2026 update, no decision had been reported. Treat the connection limit as in force until the Board acts.

Separately, the Monterey Peninsula Water Management District runs a water permit process for fixture changes, including adding a second bathroom, so check permit history before you plan a remodel. Our guide to water use and property plans explains what to request from the seller.

Away from the Peninsula, the CDO does not apply. A state groundwater filing on the City of Marina’s groundwater sustainability agency distinguishes the part of the city that does not get water and sewer service from Marina Coast Water District, which serves the rest. In the Salinas Valley, cities run their own systems, and rural parcels rely on wells and small systems; see our land and ranches guide.

Septic systems

Where there is no sewer, the county’s Environmental Health Bureau permits septic systems under its Local Agency Management Program. The Central Coast Water Board approved the LAMP on May 10, 2018, and it applies to permits issued from May 11, 2018; an amendment to the county’s sewage ordinance took effect June 14, 2023. Existing, properly functioning systems do not have to change, but new systems, repairs and replacements must meet LAMP standards, and sites with high groundwater, shallow soils or slow percolation may need an alternative system with supplemental treatment. Ask for the permit file and pumping records before you remove contingencies.

Transportation

Monterey County has no commuter rail. Salinas station, at 11 Station Place, is the county’s Amtrak stop. By car, US 101 runs the length of the Salinas Valley through Salinas, Gonzales, Soledad, Greenfield and King City; SR 1 serves the Peninsula, Marina, Castroville, Moss Landing and Big Sur; SR 68 links Salinas with Monterey; and SR 156 connects US 101 with the coast near Castroville. Local buses are run by Monterey-Salinas Transit; check its current routes.

Vacation rental rules

• Unincorporated county. The county’s vacation rental page describes three license types. Homestays (owner present) and limited vacation rentals (owner absent, up to three rentals a year) need a vacation rental operation license with no cap. Commercial vacation rentals also need a use permit or coastal development permit and are capped by planning area, for example 201 in the Carmel Valley Master Plan area, 155 in the Greater Monterey Peninsula Area Plan, 118 in the Carmel Area Land Use Plan and 57 in Del Monte Forest. Vacation rentals are prohibited in the Big Sur Coast Land Use Plan area, and commercial rentals are excluded from Carmel Valley Master Plan residential districts. Only detached single-family homes and certain manufactured homes qualify; condos, duplexes, ADUs and JADUs do not.
• Dates and litigation. The inland rules took effect October 14, 2024, and the coastal rules on October 24, 2025, after final adoption on September 23, 2025, according to the county’s ordinance page. The county has paused enforcement of two challenged provisions while a lawsuit is pending and says the ordinances may change. The county page does not say whether a license transfers on sale; ask before you count on income.
• Pacific Grove. The city’s short-term rental program accepts new whole-unit license applications only in the Coastal and Commercial zones, under a 250-license citywide cap, one per parcel and a 55-foot separation from existing licensed parcels. Home sharing of one room is allowed citywide when the owner lives on site, and that permit does not convey on sale.
• Other cities. Monterey, Carmel-by-the-Sea and the remaining cities were not verified for this guide; confirm with each city. See our California short-term rental guide.

Long-term rental rules

Statewide, the Tenant Protection Act limits most rent increases to the lower of 10% or 5% plus the change in the cost of living and adds just-cause protections after 12 months, according to the California Attorney General. Salinas adds its own layer. The city’s rental registration and rent stabilization page says landlords must register rental properties, and covered units, which include multifamily dwellings built before February 1, 1995, are limited to the lesser of 2.75% or 75% of the latest 12-month CPI-U change. The council placed a repeal ordinance on the November 3, 2026 ballot, and the rules stay in effect until voters decide; check the certified result before you underwrite a Salinas rental. Our Salinas multifamily page covers investor questions.

Ownership costs

Transfer tax. Counties levy documentary transfer tax at $0.55 per $500 of value on conveyances over $100, excluding liens that remain on the property, under Revenue and Taxation Code 11911 (mirror of the official code). The county pages we reviewed list no separate city transfer tax; confirm with your title officer. See California transfer tax.

Tax bill and coastal records. District assessments vary by address, so read the current tax bill and plan for a supplemental tax bill. For coastal homes, our guide to existing coastal home records lists the permits to request.

Choosing a short list

1. Confirm the water provider and whether the parcel has an existing connection.
2. Decide between public sewer and septic.
3. If you may rent short term, check the county planning-area cap or the city rule.
4. Confirm jurisdiction, Coastal Zone status and tax-bill charges for the exact parcel.

We can pull parcel records and listings; start on our Monterey County buyer page or contact us. Vineyard buyers can start with Monterey County vineyards.

Questions people ask

Can I get a new Cal-Am water connection on the Monterey Peninsula?

Not for Carmel River water while Condition 2 of the State Water Board’s cease and desist order stands. MPWMD has asked the Board to lift it; the request was pending at review.

How many cities are in Monterey County?

Twelve: Carmel-by-the-Sea, Del Rey Oaks, Gonzales, Greenfield, King City, Marina, Monterey, Pacific Grove, Salinas, Sand City, Seaside and Soledad.

Are vacation rentals allowed in Big Sur?

No. The county’s ordinance prohibits vacation rentals in the Big Sur Coast Land Use Plan area.

Can I run a vacation rental in Pebble Beach?

Possibly, as a commercial vacation rental with a coastal development permit, within the Del Monte Forest cap of 57, or as a homestay or limited rental with a county license.

Does Salinas have rent control?

Yes, for covered units: increases are limited to the lesser of 2.75% or 75% of CPI-U. A repeal measure was on the November 3, 2026 ballot; check the certified result.

Can I rent my Pacific Grove home short term?

Only with a whole-unit license in the Coastal or Commercial zones, subject to a 250-license cap, or by home sharing one room while you live there.

Is septic common in Monterey County?

In Big Sur, much of Carmel Valley and the rural south county, yes. The county permits systems under its LAMP; new and repaired systems must meet its standards.

Sources & notes

1. State Water Board: California American Water Company current issues (CDO and MPWMD application).
2. Monterey Peninsula Water Management District: Who we are.
3. California DWR SGMA portal: City of Marina GSA.
4. County of Monterey: Local Agency Management Program.
5. Amtrak: Salinas station.
6. County of Monterey: Vacation rentals.
7. County of Monterey: Vacation rental ordinances (coastal and inland).
8. City of Pacific Grove: Short-term rental program.
9. California Attorney General: Landlord-tenant issues.
10. City of Salinas: Rental registration and rent stabilization.
11. Revenue and Taxation Code 11911 (Justia mirror; official text at leginfo.legislature.ca.gov).

Notes: The State Water Board’s decision on lifting the CDO’s Condition 2 was pending at review. Which Peninsula addresses are Cal-Am customers, the sewer column, and the water providers shown for Seaside, Del Rey Oaks, Salinas, Carmel Valley and rural areas, were not confirmed against a provider map; confirm for the exact parcel. Vacation rental rules for Monterey, Carmel-by-the-Sea, Seaside, Marina, Salinas and the Salinas Valley cities, and any city transfer tax, were not verified against official pages. The Salinas repeal measure’s outcome was not known at review. Rules change; verify before you buy.

General information, not legal, tax or lending advice. Updated November 2026. Primary sources are linked in this guide.

Related: Monterey County homes · Water use and property plans · Existing coastal home records · Unincorporated Monterey County