To allow or not aloow tenants to Air BnB

14 Replies

Good morning BPers!

I'm planning to purchase a duplex, that I will live in one unit, while renting out the other. I was thinking of Air BnBing one of my rooms in my unit, but I was not sure if I wanted to allow my tenant to do the same. It does seem a bit condescending to do it and not allow them too. But it would mean opening the door for problems down the road, when I move out after a year and move into my next purchase.

How have others dealt with this situation? Charging a fee to the tenant to allow them. Or just not do it myself and not allow that door to be opened at all.


Thanks for your feedback

~Will

Why not explore AirBnB’ing the entire second unit?

Hey Will,

One thing that popped in my mind is, do you feel comfortable allowing someone else to pick the Air BnB tenants and have them living close by to you. 

If the area is very desirable for Air BnB, I would personally Air Bnb them all to gain a huge profit. If you live in a tourist area, Air BnB can make a much larger profit than a rental. 

You can rent out the room in your unit, and then Air Bnb the entire other unit (either by door or entire unit).

There are a few options. Hope I helped.

Thanks.

So you want to let a tenant use YOUR property to make some $$? And what responsibility will they have to deal with issues, damages, complaints, liability etc etc etc?

Sounds like a horrible idea to me to let a tenant basically run a business out of essentially renting out part YOUR property to someone else.....

If you want to do it on your side, then fine....its YOUR property.....you can do whatever you want..... but giving that kind of control to a tenant is a horrible idea in my view

Agree, there is an extremely limited scenario where I would let a tenant AirBnB my property. I do not allow any type of subletting because you are no longer able to properly vet/screen who is living/using your property and the tenant almost certainly will not be as strict since they are not on the hook for damages, etc. 

Additionally, it is not at all hypocritical for you to AirBnB your side and not let the tenant. You are the property owner and a professional real estate investor. They are definitely not one and most likely not the other as well.

@Will Foster Bad ideas to give your tenants the freedom to choose the Airbnb renters. No one is going to take care or screen vacationer better than you. Have you checked  to airbnb the complete side?

Where is this located? I would echo what others have said (@Kevin Murphy and @Etienne Martel), you could make a lot more doing AirBnB or VRBO/HomeAway instead of long term. However, it is also A LOT more work day to day.

Condescending? It's your property. Do what you want.

I second the idea of renting out the second 1/2 of your duplex on Airbnb, in addition to the room in your unit.   But that option involves increased start up and ongoing costs, both in terms of time and money.  

Although there are risks involved in letting your tenant Airbnb out their second bedroom, it could be a way to increase your cash flow with minimal work on your part. If you want to explore this option, I would recommend:

1. instead of your long-term tenant having their own Airbnb hosting account, you can add them as a "co-host" to yours.  They will only see the account that you add them as co-host. You remain the original listing host, and will have control over who is allowed to book (for example you can make it so all of the Airbnb guests have good reviews) and house rules.  This option also allows you to determine the percentage of profit splitting. If utilities/wifi are separated and the tenants are fronting the start up costs, I would suggest you split 50/50 and let them have the cleaning fees. 

2. I am definitely not a lawyer, but I would see about the possibility of making the Airbnb "business contract" separate from the lease your tenant signs.  You could allow you or your tenant to terminate the Airbnb agreement with X many days notice.  (If you do this, make sure to only allow people to book a month ahead so you don't get hit with cancellation fees). That way if you do move out and/or things change down the road, you have given yourself an out. 

3. As a landlord you should already have some sort of umbrella liability coverage...I would require your tenant to have some as well.  

I love how you are thinking outside of the box on this! I've been an Airbnb host for 2 years so let me know if you have any questions about anything specific

If you decide to allow it, a stipulation should be that they add you as a co-host. Then you can keep an eye on tenants and even share in the profits.

If you allow tenants to Airbnb you must remain in control and you will need to receive a cut of the profits above the rental rate on the unit.

Personally I would not allow them to do it but it is your decision and you could try it on a temporary bases to begin. If there is a additional profit in it for you and you are already doing it yourself it may be a viable option. 

I would have your tenants on M2M lease in case it goes badly.

@Will Foster it is your property, so your liability. Never let tenants sublet in any manner, because you lose all control of who is in the property. I like the suggestion that @Kevin Murphy made, which is why not AirBNB the second unit? It is probably a larger cash flow opportunity for you.  

Not no but H3LL NO!

Reasons more numerous than I care to peck out on my phone.

I agree with @Joe Splitrock . This should be specifically prohibited in their lease. It is not hypocritical for you to do this as you own the property. You (hopefully) have screened your tenants and have ensured they meet your standards in terms of credit, income, background checks, etc. If your tenants were to use one room to Air BnB, this would allow people you have not screened to be staying in your lease out unit. This increases your risk profile and the name of the game is to mitigate your risk as much as possible.

You don't want randoms running an "airbnb" in your property they'll be terrible at it. Anyone can sponsor a race car but not just anyone should get behind the wheel. 

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