ATTENTION ALL LANDLORDS: Airbnb Invading - Pay ATTENTION

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ATTENTION ALL LANDLORDS: Airbnb Invading - Pay ATTENTION

Patrick Soukup
Rental Property Investor · Fort Collins, CO · Member since 2015 · 273 posts · 127 votes

Alrighty. I need ALL of your help. In the ‪#‎RealEstate‬ or‪#‎PropertyManagment‬ industry or not, I've got a duplex downtown in a very desirable location. Three miles to Colorado State University and 6 miles to downtown Old Town Fort Collins, Co --- Currently, one of the "tenants" is using the one bedroom/one bathroom and loft as an Airbnb. I wouldn't have KNOWN, but that the neighbors complained of "all the people coming in and out always." She is charging $91/night, taking REALLY good care of the unit (as she has incentive to make it a nice place to stay for STR's - short term renters). She has gotten great reviews by people that have stayed there. SO ---- what do you do? Evict her for violating the lease (subleasing without permission)? Implement a revenue sharing model as discussed on Multifamily Executivehttp://www.multifamilyexecutive.com/…/deal-or-no-deal-airbn… ? OR --- evict/talk her into moving out and start the Airbnb myself? (This would increase my revenue substantially as the duplex is in a very desirable area- but add considerable labor on a monthly basis.) Things to think about: Liability - no background/credit checks --- long term tenant annoyance --- City of Fort Collins, Colorado - Government is currently talking about STR's and how they are going to handle them. Thank you for your input! It is much appreciated.

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Roy N.Pro Member
Rental Property Investor · Fredericton, New Brunswick · Member since 2013 · 7k+ posts · 4k+ votes
10y

This one is straight forward.  Your tenant is conducting a hotel/hospitality business from your rental property which surely puts her in violation of her lease and might put you on the wrong side of the local tenancy or hospitality regulation.   On top of that, it's most probable your insurance company will not be warm and fuzzy to the current goings-on.

Give her a notice to terminate {end the lease} or, at the very least, a notice to comply (a shot across the bow) ending the hoteling venture.

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  • David Hays
    Investor · Malaga, Andalucía · Member since 2014 · 150 posts · 73 votes
    10y

    This is going to heavily depend on your local regulation, and the liability that you incur by allowing her to do this in your property. If you can work that out to a comfortable level, I think the most reasonable path would be to propose a revenue sharing agreement, but this would certainly require a revision to your current lease. This allows you to keep a tenant manager who's invested in keeping your unit in top shape, while you're able to increase your bottom line with no extra work - especially if you're not experience in the industry, as it is very different from conventional real estate. If you kick her out, only to turn around and start your own Airbnb, then you'll just become another hypocritical landlord AND have no guarantee that you'll be able to replicate her performance, so perhaps you miss out on the great tenant and the additional income you're expecting.

    4Reply
  • Eugene Kemp
    Ormond Beach , FL · Member since 2015 · 345 posts · 223 votes
    10y

    I think you should discuss with her that she is in violation of her lease for subletting and let her decide what she is going to do.  I would NOT allow her to operate Airbnb with you being the one ultimately responsible for any issues.  I have operated an Airbnb and I doubt that they would sanction someone who did not own the property, but cannot say for sure.  Ultimately, your call, but seems risky to me.

    3Reply
  • Roy N.Pro Member
    Rental Property Investor · Fredericton, New Brunswick · Member since 2013 · 7k+ posts · 4k+ votes
    10y

    This one is straight forward.  Your tenant is conducting a hotel/hospitality business from your rental property which surely puts her in violation of her lease and might put you on the wrong side of the local tenancy or hospitality regulation.   On top of that, it's most probable your insurance company will not be warm and fuzzy to the current goings-on.

    Give her a notice to terminate {end the lease} or, at the very least, a notice to comply (a shot across the bow) ending the hoteling venture.

    7Reply
  • David Hays
    Investor · Malaga, Andalucía · Member since 2014 · 150 posts · 73 votes
    10y
    Originally posted by @Eugene Kemp:

    I have operated an Airbnb and I doubt that they would sanction someone who did not own the property, but cannot say for sure. 

    Though it is not the pivotal point here, I thought I would clarify this, as I can say for sure that Airbnb makes no distinction between who the owners of a property are. When you sign up, you certify (as the Host) that you have the legal right to offer the property in such a way - which in the case of Patrick is not correct, but a property manager would be another story - and that's where Airbnb leaves it. They specifically step aside in any disputes in this regard, and it is notoriously difficult to try to get information as the property owner (as they will generally strive to maintain client privacy). 

    0Reply
  • Sarah Ziehr
    Real Estate Broker · Chicago, IL · Member since 2015 · 531 posts · 266 votes
    10y

    Airbnb is a huge problem in my market. Many buildings don't allow it and I've heard of a couple of times where people are fined, sued, etc. by the HOA or a local ordinance.

    As for your situation are you willing to proceed with Airbnb if the neighbors are complaining to you? If so then you might want to come to an agreement with her or ask her to leave. 

    I have a client who makes a good amount of money with Airbnb, but she only does it on peak times (summer, weekends). 

    I personally would not want to deal with Airbnb, it seems too time consuming, annoying and potentially expensive. 

    0Reply
  • Patrick Soukup
    OP
    Rental Property Investor · Fort Collins, CO · Member since 2015 · 273 posts · 127 votes
    10y
    Originally posted by @David Hays:

    This is going to heavily depend on your local regulation, and the liability that you incur by allowing her to do this in your property. If you can work that out to a comfortable level, I think the most reasonable path would be to propose a revenue sharing agreement, but this would certainly require a revision to your current lease. This allows you to keep a tenant manager who's invested in keeping your unit in top shape, while you're able to increase your bottom line with no extra work - especially if you're not experience in the industry, as it is very different from conventional real estate. If you kick her out, only to turn around and start your own Airbnb, then you'll just become another hypocritical landlord AND have no guarantee that you'll be able to replicate her performance, so perhaps you miss out on the great tenant and the additional income you're expecting.

     Thanks! Currently, the City of Fort Collins is working towards how they are wanting to deal with Airbnb.  At the LEAST I will be restructuring her lease, but most likely due to the trust that has been lost, I will end up ending the relationship.  I am giving myself til Monday to make a decision (her March rent was deposited today --- want to make sure it clears).

    0Reply
  • Patrick Soukup
    OP
    Rental Property Investor · Fort Collins, CO · Member since 2015 · 273 posts · 127 votes
    10y

    Clearly @Roy N. this is not a straight forward topic, as MFE does not just put **** in their publications.  I completely agree on the insurance aspect.  I'm not a big fan of any violation of the lease, that is for sure, and for that reason will probably end the relationship and re rent as a long term rental.  BUT, it is a fun conversation to be had.

    0Reply
  • Patrick Soukup
    OP
    Rental Property Investor · Fort Collins, CO · Member since 2015 · 273 posts · 127 votes
    10y

    I agree @Sarah Ziehr --- I don't think I am up to the additional labor it would take to run an EFFECTIVE Airbnb.  She does seem to have the time, but the liability probably isn't worth it. 

    Her neighbor is the one who complained, and they are great residents.  I want to keep them happy.

    0Reply
  • Roy N.Pro Member
    Rental Property Investor · Fredericton, New Brunswick · Member since 2013 · 7k+ posts · 4k+ votes
    10y
    Originally posted by @Patrick Soukup:

    Clearly @Roy N. this is not a straight forward topic, as MFE does not just put **** in their publications.  I completely agree on the insurance aspect.  I'm not a big fan of any violation of the lease, that is for sure, and for that reason will probably end the relationship and re rent as a long term rental.  BUT, it is a fun conversation to be had.

    Patrick:

    I agree it is an interesting conversation and this type of event is going to occur more and more frequently.

    Regardless of what MFE publishes, the situation is one of your property, your lease, your tenant and your risk.  Or, more bluntly, do you want your tenant earning twice as much per month from your property as you, while you shoulder the risk and liability of operating without the necessary licences or insurance and in possible violation of legislation or regulation?

    Circumstances would be quite different if your tenant approached you in advance and indicated they wanted to run an airbnb from part of your property.  You could then determine if such an operation would be legal; ensure the appropriate licences and insurance coverage were in place; and arrange a different, more commercial, lease with the tenant to ensure you are appropriately remunerated for the {new} use of your property.

    IMHO, it's still a straight forward business decision.

    1Reply
  • Gail K.
    Augusta, GA · Member since 2014 · 1k+ posts · 1k+ votes
    10y

    Patrick...I can't speak about your tenant going the Airbnb route but I recently found out my four year tenant couple had been renting rooms out to others on a longer term basis.  This was in direct violation of the lease which 1. specifically lists who can reside there,  2.  prohibits subletting/adding new tenants/roommates without the permission of the landlord and 3. prohibits running any type of business out of the rental property.  

    In this case they were making money on my rental by charging three roommates more than the total amount of the rent and allowing them to bring in all the pets they wanted.

    Instead of evicting them I raised the rent the exact amount of the rent they were charging these folks.  They likely got the idea I had caught on to what they were doing, paid the higher rent the next month but also provided me the appropriate notice of termination of their month to month tenancy.

    I do have to say these extra tenants (and pets) have left MUCH damage in this rental house.  The positive news is that my original tenants were good enough to provide me with their new address (they believe they are getting their full security deposit back) so I will have an address for the court to notify them when I file against them since these damages will exceed their deposit.

    Even though your tenant is maintaining your property the idea that she is decided to use it for her financial gain does not sit well.  And, has been pointed out, you need to be concerned regarding insurance liability issues here.  Nip this economic venture of hers in the bud now.  You've already got neighbors complaining about this issue.

    If you don't wish to evict her (and she's on a month to month tenancy) look into estimating how many nights in a month she's been renting out this room at $91 a shot and raise her rent the equivalent amount.   Explain why your are doing this.  That should either get her out or rethinking her running a business out of your property.

    Gail

    3Reply
  • Patrick Soukup
    OP
    Rental Property Investor · Fort Collins, CO · Member since 2015 · 273 posts · 127 votes
    10y

    @Roy N. I couldn't agree more.  Thank you for you input! 

    0Reply
  • Patrick Soukup
    OP
    Rental Property Investor · Fort Collins, CO · Member since 2015 · 273 posts · 127 votes
    10y

    Thanks @Gail K. I appreciate your insight.  They are on a year lease starting Jan 2016 - Dec 31 2016 --- so unfortunately I won't be able to raise rent.  But I will try to get them out of their without eviction but have my lawyer on standby for this one.

    0Reply
  • Jeff B.
    Buy & Hold Owner · Redlands, CA · Member since 2015 · 5k+ posts · 2k+ votes
    10y

    All landlords should have two clauses in their lease:

    1. sublet or room sharing is explicitly prohibit
    2. no business activity whatsoever may be conducted on the premises, including but limited to baby setting, auto repair, activities which entices a flow of people to come and go.
    1Reply
  • Patrick Diamond
    Real Estate Consultant · Los Angeles / México City · Member since 2015 · 34 posts · 30 votes
    10y

    Patrick:


    First off, I do believe some people are being a bit harsh here, though I understand why... Airbnb is a new system of utilization of real estate, and many, many people honestly have no experience with it, though there are many people with an opinion.


    I can tell you this... from direct experience and indirectly as a consultant, that for the most part, you'll find that Airbnb "guests" are nowhere near as hard on things as a regular tenant who gets "comfortable"... that is, of course, assuming that they are being managed well (slumlords tend to have crap tenants... bad Airbnb hosts (or under experienced ones) tend to have bad guests.


    That said, your tenant has shown you that there is a market at your property for short-term rental.  You have the opportunity of making quite a bit more money (recent data indicates that it is possible on average to make 3x the amount renting on Airbnb vs standard rentals with much less wear and tear, and it can be more fun!).

    I am not invalidating some of the comments made here... It is important to note, however, that there is a LOT of misinformation out there, as there typically is with anything new, especially involving technology.


    Real estate is a marketplace that does not frequently change drastically... and the short term rental / Airbnb movement is an instance where it is, and has.

    From a cursory glance at regulations in your locale, it seems that there may be some regulatory blocks... See Larimer County Land Use Code 4.3.6 (B).

    Why not explore the business that your tenant has created and see if you could partner successfully with her in one way or another.  I place this here mainly as a guide to others encountering a similar situation, especially where regulatory issues are not involved.

    I am more than happy to assist in any way possible, and I do wish you good luck in sorting it out :)

    2Reply
  • Jerry W.Pro Member
    Moderator
    Investor · Thermopolis, WY · Member since 2012 · 4k+ posts · 4k+ votes
    10y

    @Patrick Soukup, I have a much different view than the others.  I admire those who have the intelligence and fortitude to try to make money other than an hourly wage.  I suggest you look into its legality.  Next I would look into the insurance needed to take the risk out of it.  if you can get both figured out to your satisfaction you talk with your renter and make sure she gets any special permits or insurance needed to protect you.  I might double up on or more on the deposit, just in case.  Then I would see if you can get more rentals near her and make a deal for you buying and her managing while giving her a slice of the pie for running it.  Someone is making a killing there, why not let it be you?  You are making money with folks just paying regular rent, imagine if you rent them out by the day.  This way you both win, you both profit.  If all goes well maybe you end up owning 20 rentals there and pocketing an extra $1K or $2K per month on each.  Think of this as a stroke of luck.

    5Reply
  • Jason V.
    Investor · Rochester, NY · Member since 2016 · 477 posts · 426 votes
    10y

    I think I understand the compassion and understanding here for someone who is being entrepreneurial and thinking in new ways to make extra money, but let's change the context and see how many folks still think this tenant would be a good business partner: 

    What some folks are essentially suggesting is that they would be wiling to partner with someone who is knowingly violating a rental/lease agreement, and deliberately lying to at least two parties (the owner and AirBnB) for her own personal gain, which puts the owner at a significant risk (he doesn't just get to walk away if it all goes horribly wrong, etc.) 

    If you worked with a Contractor who lied to you, broke agreements, violated contracts, etc. how likely would you be to work with them again? I've heard of folks on here not using GCs again for much less than that. 

    If it's such a great deal or opportunity, the partnership shouldn't have to be with someone you can't trust for it to be successful. 

    3Reply
  • Jose Ramirez
    Investor · Hartford, CT · Member since 2016 · 4 posts · 2 votes
    10y

    i own a three family and I run an. aAirbnb out of it. I have another three family and I rent two floors and run an airbnb out of one floor. Long term tenants and Airbnb dont get along. No one likes constant strangers stepping foor where they reside and mind you the long term tenants are section 8 and the majority of Airbnb guests are white collar. I find it fascinating. I see first hand everyday true mixed income living. And it can work as long as no one parks in someone elses space accidently. 

    Here are the basics with legal: zoning, taxes, and building code and city ordinances. Is your neighborhood zoned to be allowed to run an bed and breakfast? If there are commercial properties with a block or two radius most likely the answer is yes. If there are no businesses and just houses most likely no. End of story there. You need to cease before you receive fines. Secondly, if you can run a bnb then you need to file you with the city that you are running a bnb. You will most likely pay more in property tax. Proportinate to the portion that is run as an bnb. Then you need to meet building code to receive your CO as a bnb. This might require a fire alarm system with a pull station depends on you town and different grandfather laws. Then each city might ask for something special or particular to youe town. NYC charges a hotel tax which is paid through Airbnb. 

    After legal than you have insurances. Airbnb provides guest and user a blanker million dollar liability policy. You should call your insurance and she what you need. 

    One way to side step a lot of this is to up the minimum stay to a month and in essence airbnb just becomes a more sophisticated craigslist in theory, connecting users to each other who are looking for and have available month to month occupancies. 

    This is obviously a blog pitting millenials embracing the shared economy approach, for example uber, and the old guard protecting the ways of old. I am on the milennial side yet I know we are all on the money side, right? So what is going to fit best with your investment strategy and which way is going to bank the most return. I think it will be a straight rental. What is lost on most isbthe actual overhead of running a bnb, pay all utilities incld cable and internet. Thats three days a month of rentals right there. Then you have laundry. Whos paying for all the extra water by the way. And now furniture depreciation. After all said and done four to five days are paying for overheads. Then unless your in the top tourist cities you vacancy rates are around 50% minus five days. She banks about 910 dollars a month of which 3% goes to airbnb so she profits 883. If your in the she banks twice that. Really easiest thing is to increase rents because of the violation in your lease. Sign a new lease if you want stipulating all that the guys above have proposed and add that she needs to take out general liability insurance specific for running a hotel and keep it current and to give you a copy. And ask for a copy every month with your rent to make surebits current. 

    Hope this helps someone.

    2Reply
  • Gail K.
    Augusta, GA · Member since 2014 · 1k+ posts · 1k+ votes
    10y

    I have to agree with Jason V..  It would be one thing if this tenant had come honestly to Patrick with this idea prior to initiating it.  She didn't.  One must question the ability to trust this person as a partner.

    She has violated the terms of her lease.  He can either terminate the lease based on what she has done or consider rewriting a new lease increasing the rent to reflect her business venture AFTER he has confirmed his risk of agreeing to this with his attorney.

    Gail

    0Reply
  • Gino BarbaroPro Member
    Rental Property Investor · St Augustine, FL · Member since 2014 · 2k+ posts · 1k+ votes
    10y

    @Patrick Soukup

    Hi Patrick

    I would think this might one you up for liability, especially since you are now aware of the situation.  I would speak to my insurance company and get their opinion.  If she did violate the lease, that is grounds for eviction.

    Airnbnb is like uber.  People either love the service or they hate it.  I know someone in a similar situation who has increased his monthly collection dramatically by using Airbnb.  

    I would check out this service and see how much more you will net monthly.

    Gino 

    Podcast Guest on Show The “Conveyor Belt” System That’ll Build You a BIG Rental Portfolio Quickly
    0Reply
  • Bob H.
    Rental Property Investor · Cedar Park, TX · Member since 2014 · 415 posts · 272 votes
    10y
    Originally posted by @Patrick Soukup:

    ... I wouldn't have KNOWN, but that the neighbors complained of "all the people coming in and out always." She is charging $91/night, taking REALLY good care of the unit (as she has incentive to make it a nice place to stay for STR's - short term renters). She has gotten great reviews by people that have stayed there.

    To whom are the neighbors complaining, and how many neighbors are complaining? Particularly because you are considering operating a short-term rental yourself, I think you should ask the people who complain what specific problem "all the people coming in and out" have caused for them. If the neighbors say there are loud parties late at night or cars parked in spaces assigned to the neighbors (not spaces on a public street that the neighbors just like to use), then the neighbors have a legitimate complaint. If not, then by asking questions the right way maybe you can get the neighbors to realize that they are perceiving a problem where there is none.

    As for not knowing your neighbors, that is the case in most parts of America,  particularly multifamily buildings. If the neighbors say they just don't like not knowing who is in your duplex, ask if they can tell you the names of everyone else on their block, on both sides of the street. I predict that they won't know.

    1Reply
  • James DeRoest
    Investor · Century, FL · Member since 2015 · 950 posts · 603 votes
    10y

    Think there was a legal case in NY about this very recently. The tenant was subletting iirc, and the city treats Airbnb properties as lodgings like hotels, so not only was there a zoning issue, but there was the whole breach of things like number of fire exits and so forth.

    The landlord tried to evict but has failed, the city sued, and the tenant continued the business. The landlord is looking at something like $300k in fines which was upheld at appeal, and the landlord can't dodge it.

    I can't remember the exact case or the specifics though.

    1Reply
  • Alice K.
    Investor · San Francisco, CA · Member since 2015 · 306 posts · 211 votes
    10y

    A Passive Income Thought 
    Here is a thought as a bystander, some flaws, but the folks in this thread have already addressed them above. 

    Say your goal is truly passive income, and she's profiting off of your pad. If she's running the operation, and living there, chances are she'll continue to keep it spick and span. Now, you can get greedy (as I probably would be in this situation, putting aside the worry that one of the Airbnb guests are a bad apple and destroy the place / stay around and you have to evict them).

    It could be a win-win. Definitely do as the others say and update the lease so you get royalty. Maybe throw in some items such as, "Any legal fees are up to you to pay, eviction, etc." AND "Any damage incurred you have to fix" AND you can inspect it once a month (if you're worried about it) AND update the security deposit. Just an idea, I'm sure a lawyer can help you with reasonable items. 

    I have a few friends who have said they do just this. The owner of the homes gets what he wants (rent to cover the mortgage and costs with a bit on the top) and this guy manages and makes money off of renting them as Airbnb's and is responsible for things that break and trusted to keep it in tip-top shape, etc. 

    Sure, he's making good money for not too much work, but the owner doesn't have to do anything. And, he has guaranteed rent. 
    ***********
    But, if you're still concerned, you're not alone. Here is a NY news story on landlords kicking people out. (As I'm sure you've already investigated for research.)

    1Reply
  • Lesley Resnick
    Real Estate Agent · Jacksonville, FL · Member since 2015 · 1k+ posts · 1k+ votes
    10y

    First and foremost you need to determine if your municipality allows airbb?  If they don't then you need to have them stop.  Things like this always get out.  The same way your found out the municipality will.  If they are good tenants, pay rent on time and do not trash the place, let them stay.  Otherwise tell them they are in violation of the lease and need to move out.  It is always better for people to leave on their own, than evict them.  It costs time and money to evict and it is rare that you come out even or ahead.

    If you can legally have an airbb, then game on.  A revenue share model is fantastic.  The tenant will manage and run the service, the landlord collects additional money.  The tenant has their stuff in the unit and assumes the greatest risk, since you have their deposit.  You may want to consider raising the deposit.    

    2Reply
  • Michael Hayworth
    Contractor · Fort Worth, TX · Member since 2015 · 379 posts · 740 votes
    10y

    Some slightly different thoughts here:

    1.  See if you have an issue with your insurance company. Hopefully, you have a good agent you can talk to "off the record" and get his input. Your renter who's operating the AirBnB needs to be the one to carry insurance  that covers whatever this is.

    2. AirBnB and VRBO guests tend to be pretty kind  to the property. They get rated by the hosts, just  like hosts get rated  by the guests.

    3. A lot of people seem to be jumping to the conclusion that your renter is "knowingly violating her lease." Maybe she is...maybe she just saw an income opportunity and didn't even  think about it.

    4. I  WOULD NOT implement  a revenue sharing model. Too much overhead to deal with - you have to look  at her books,,  figure out how much she gained, calculate your percentage,  figure out if she's cooking the books. That's  a lot of overhead. INSTEAD, just raise her rent $400 (or whatever) per month. ( I saw  you commented her lease runs for awhile,but she is in violation of her lease...her choice would be increased  rent or  lose the AirBnB.) Then you don't  have to worry about reviewing her records and all that. Maybe put $300  of the increase in your pocket and offer the tenant who complained $100/mo off her lease.  Everybody is  happy then.

    The woman is trying to pick up some extra cash and seems to be doing it without doing damage to your house. If you can work it out so you both benefit, great. Take the AirBnB away from her and she'll have to find something else....she could end up offering "adult  massages" out of your apartment. Or worse yet, end up on here asking how she can make millions in real estate by wholesaling houses with no money down!

    3Reply
  • Joe SplitrockPro Member
    Moderator
    Rental Property Investor · Sioux Falls, SD · Member since 2015 · 9k+ posts · 18k+ votes
    10y
    Originally posted by @Jose Ramirez:

    i own a three family and I run an. aAirbnb out of it. I have another three family and I rent two floors and run an airbnb out of one floor. Long term tenants and Airbnb dont get along. No one likes constant strangers stepping foor where they reside and mind you the long term tenants are section 8 and the majority of Airbnb guests are white collar. I find it fascinating. I see first hand everyday true mixed income living. And it can work as long as no one parks in someone elses space accidently. 

    Here are the basics with legal: zoning, taxes, and building code and city ordinances. Is your neighborhood zoned to be allowed to run an bed and breakfast? If there are commercial properties with a block or two radius most likely the answer is yes. If there are no businesses and just houses most likely no. End of story there. You need to cease before you receive fines. Secondly, if you can run a bnb then you need to file you with the city that you are running a bnb. You will most likely pay more in property tax. Proportinate to the portion that is run as an bnb. Then you need to meet building code to receive your CO as a bnb. This might require a fire alarm system with a pull station depends on you town and different grandfather laws. Then each city might ask for something special or particular to youe town. NYC charges a hotel tax which is paid through Airbnb. 

    After legal than you have insurances. Airbnb provides guest and user a blanker million dollar liability policy. You should call your insurance and she what you need. 

    One way to side step a lot of this is to up the minimum stay to a month and in essence airbnb just becomes a more sophisticated craigslist in theory, connecting users to each other who are looking for and have available month to month occupancies. 

    This is obviously a blog pitting millenials embracing the shared economy approach, for example uber, and the old guard protecting the ways of old. I am on the milennial side yet I know we are all on the money side, right? So what is going to fit best with your investment strategy and which way is going to bank the most return. I think it will be a straight rental. What is lost on most isbthe actual overhead of running a bnb, pay all utilities incld cable and internet. Thats three days a month of rentals right there. Then you have laundry. Whos paying for all the extra water by the way. And now furniture depreciation. After all said and done four to five days are paying for overheads. Then unless your in the top tourist cities you vacancy rates are around 50% minus five days. She banks about 910 dollars a month of which 3% goes to airbnb so she profits 883. If your in the she banks twice that. Really easiest thing is to increase rents because of the violation in your lease. Sign a new lease if you want stipulating all that the guys above have proposed and add that she needs to take out general liability insurance specific for running a hotel and keep it current and to give you a copy. And ask for a copy every month with your rent to make surebits current. 

    Hope this helps someone.

    Just curious why do you say this is pitting millenials against others? I am not a millennial and I love the concepts of Airbnb and Uber because it give consumers (me) more options. I think the question is since she is subletting the property and the lease prohibits that, what action should he take? It is about liability. It is the same if someone runs a day care in your property. It would be the same if you were an Uber driver with your company car.

    1Reply
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