Air BNB and Home Away: Should Landlords Allow Tenants to Sublease?
AirBNB and Home Away offer travelers an alternative to tired chain hotels by allowing individuals to open up their personal properties for a night, a week, or longer. Not everyone renting out these properties is the actual property owner, though. Renters, especially in expensive cities like New York and San Francisco, use AirBNB to defray the cost of their apartment or even to make a profit. While this situation is technically subletting, there are unique concerns and benefits that come along with these home sharing services.
The Downside of AirBNB and Home Away for Landlords
One of the biggest problems you may have with home sharing services is a breach of the rental agreement. If you don't allow tenants to sublet, then legally they are in breach of contract with you. You are within your rights to request that tenants cure the breach or leave the home, which could lead to eventual eviction action if they don't remedy the situation. A secondary risk to temporary subletting is the lack of screening and control over the individuals occupying your property. If you put your tenants through a thorough screening process, you don't want random travelers gaining access to your property.
Another downside comes from rent-controlled apartments, where the tenant pays below market rate on the property. A large disparity between market rent and the rent-controlled payment makes it easy for a tenant to profit off the rental by charging high prices on AirBNB and Home Away.
Finally, some cities and towns don't allow temporary stays below a specific time period, such as 14 or 30 days. These local ordinances can cause major issues, and neighbors and other tenants may not appreciate a variety of people occupying the shared property on a regular basis. As AirBNB and other home sharing sites become more popular, more localities are regulating temporary shared rentals.
The Benefits of AirBNB and Home Away for Landlords
A tenant pursuing an AirBNB option isn't all negative, as long as you live in an area where it's legal and you've checked with neighbors or other tenants to make sure they aren't disturbed by this activity. Instead of working against tenants who would like to rent out the property through home sharing services, offer to work with them. Landlordology recommends adopting an innkeeper model, in which you handle the property listing and the tenant handles the on-site duties. With this system, your tenant is personally invested in making sure that visitors treat the home well, and you have some oversight into what's going on at your property. You also get to introduce a revenue stream that adapts to the home sharing trend. Consider home sharing a market research experiment: If the rental is particularly popular, you may transition the property into a full home share option or vacation rental once your tenant's lease is up.
Property sharing services are here to stay, especially for travelers who want a local, unique experience when they're visiting a new city. If you don't want to have unscreened visitors staying at your property, or if you live in an area where short-term rentals are illegal, specify this clause in your lease agreement. If you are open to home sharing, though, you could be looking at an additional revenue stream for your apartment and a collaboration between you and your tenant in which both parties benefit.
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