Hi everyone,

Six months ago I purchased a three-family home in Jersey City. I have leased one apartment, the second I reside in, and I'm considering my options for the third. 

Has anyone had any experience in leasing / versus Airbnb? Are you finding either more lucrative long-term?

Many thanks in advance.

@Troy Leinster Jersey City is currently working on an ordinance that will effectively ban Airbnb in the city. It's likely to pass. I'm following this closely because I'm on a group chat with Airbnb hosts who are fighting it(I'm not currently a host but may want to be in the future) They are probably gonna lose. My recommendation is to follow what's going on (they have a Facebook page with updates) but I wouldn't go with Airbnb as it's likely to be outlawed or restricted in a way that makes it impossible to use a unit as a full time Airbnb. It's possible they will carve out exceptions for people like you living in the property so do yourself a favorand keep up with what's going on with the ordinance. The council is drafting the ordinance as we speak and there should be some clarity in June. All that being said I'm a landlord in JC and doing quite well so far so I recommend that route. Properties under 4 units I believe aren't subject to rent control so you can get good rents and increase them. Demand is extremely high in the area and you will have your pick of tenants. If you have a good product you will have tenants within a week of posting the unit.

I did read that it's aimed at multi-unit complexes rather than small owner occupiers. But I will look for the Facebook group. Thanks for your advice!

@Troy Leinster As I understand it, the ordinance is aimed at literally all listings with a possible carve out for owner occupants like yourself although I’m not sure if you have to live in the building as you plan to or in the unit itself as in room sharing. A lot of people bought houses or rented apartments with the express intention of Airbnb-ing them and if this passes those guys are gonna have shut down completely I imagine. The draft of the ordinance is expected to be ready June 5th with the first hearing on June 12th so stay tuned. Or better yet attend the meetings if you want to and talk to some of the people who are doing Airbnb and fighting the ordinance.

@Troy Leinster I've managed both. In my experience, in my market, a long-term rental requires far less effort and generally produces a better return.

Many people brag about how much they make with their vacation rental but they fail (or refuse) to share the complete numbers. There is a cost associated with furnishing the home and replacing consumables. You have to market, pay fees to the city or county, pay city/county/state taxes, pay AirBnB fees, credit card fees, utilities, landscaping, internet, and more. Then you have to account for your time spent answering inquiries, booking guests, coordinating cleaners, telling people for the 27th time how to operate the remote control or air conditioner, etc.

When you make a complete comparison, the AirBnB option may not produce a much better return and it can be a lot more work.

Thanks for your input! I'm going to keep an eye on what decision they make in Jersey City Airbnb and take it from there.