5 Questions to Consider before Becoming an Airbnb Short Term Rental Host

We live in Vacationland, so you might be thinking of renting out your home or buying an investment property to offer short term rentals through a service like Airbnb, VRBO, or HomeAway.  Here are five questions to consider before you do.

  1. Does My City or Town allow Short Term Rentals?

Many cities and towns are now starting to regulate the operation of short term rental units because of their impact on neighborhoods and residential rental stock. For example, in 2017 Portland City Council approved a short term rental ordinance that will impose a number of requirements and limitations on short term rental units in the City beginning January 2018, including a prohibition against the rental of non-owner occupied, single family residences.  Violations can result in fines or other legal action brought by the City.  Places like Bar Harbor and Ogunquit also have specific rental restrictions.  Avoid issues by researching your local laws before entering the market.

  1. Are Short Term Rentals Allowed by my Homeowner’s Association or Condo Bylaws?

Is your property subject to a homeowner’s association or condo bylaws?  If so, look carefully at those bylaws to make sure that owners are allowed to rent units to others on a short term basis.  For example, some bylaws require minimum length leases, with notice to the association of all lease activity.  There are also issues of safety and liability in common spaces to consider.  Violations of bylaws could result in litigation against you and the imposition of paying the association’s attorney fees.  If short term rentals are allowed, you should still determine whether there are certain rules, for example, standard quiet hours that you need to communicate to your guests prior to renting.

  1. If You Are a Renter, Does your Lease Allow You to Let the Unit on a Short Term Basis?

            Many renters see renting a room or their whole apartment on a short term basis as an easy way to pay the rent and make some extra money, but does your lease actually allow you to do that?  Look carefully at the lease to see what provisions relate to subletting the apartment and to short term rentals of the unit.  Consider also getting your landlord’s written approval to avoid any misunderstandings.  If you are a landlord, consider revising your leases to specifically address this issue.

  1. Is Your Place Safe for Guests?

            Under Maine law, owners of properties owe certain legal duties to prevent short term guests from getting injured while on the premises.  Before you become a short term rental host, fix that broken window, repair that damaged door latch, and address that slippery bathroom floor situation.  You should also talk with your insurance company to make sure you have proper liability coverage.

  1. Should I Use a Written Agreement with Guests?

            Yes.  A written agreement defines the relationship between host and guest.  A defined relationship is important because tenants and transient lodgers have different rights under Maine law, including what happens when a guest refuses to leave the property.  Consider working with an attorney to develop an agreement that fits your needs and prevents unnecessary problems down the road.

Are you considering operating a short term rental?  Perkins Thompson regularly advises homeowners about their property rights.  If you would like to speak with the firm about your issue, give us a call at 207-774-2635.