I get this question a LOT. Let's say you decide to buy another house or you move out of state but you don't want to sell the house you currently are in. You decide to keep it as a rental either for cash flow or until the market prices go up high enough to sell for a profit. This house is now considered a residential rental. It is no longer a primary residence. Who cares about that terminology? The County Assessor and the City it is located in. Why? Because you are now in a different tax class. Yep, that is right. You need to be assessed differently and in most cities, you will also be charged a transaction privilage tax because it is considered a business.
So, the Big Quesion is Do I Really Need to Register it? And How will they Ever Know?
The answer is Yes, you really do need to register it and sign up with the city as well. The Cities have been know to check into addresses to make sure they are registered correctly.
Now, What will happen if you Don't register...
It is the law to Register your rental property, and as you can see from above, you really don't want to take the chance.