Shor-term rentals (e.g. AirBnB) in a building with LT tenants??

5 Replies

Hello - We are considering doing short-term rental (STR) (e.g. AirBnB) in two of the units in an 8 unit building that we own. Does anyone have experience doing STR on a subset of units in a multi-family building with primarily long-term (LT) tenants? My gut is that the other tenants aren't going to like it, but I'm wondering if anyone in the community has experience with this that they would share (e.g. tips/tricks/best practices). Thanks!

@Mark Kappelman I’m doing that now in a quad. My suggestion would be to keep the str on the ground or basement level to minimize disturbance to your LTR. I would also target families for the STR and add very strict house rules, and higher than normal security deposit to weed out the problematic renters. I would also keep the occupancy level with the average to low. It wouldn’t hurt to also let the tenants know that you’re doing airbnb. One of the tenants actually asked for the link so they could have their family book it when they visit. Good luck.

I have a 14 unit apartment complex. They all are 2BR 1.5 bath. They used to be older retired people that would pay $400/month. We had several 2 BR houses that were bringing in $350-$525 per week. Once one of the apartments became vacant, we furnished it and charged $400/week. Now, 11 of them are STR's. The LT tenants can't really complain because they are the minority. Currently, there is no vacancy and a waiting list.

@Sovat C. thanks! We were planning to do one ground floor and one garden unit for STR so similar to your guidance. We also planned to let our tenants know and to your point they ‘guest angle’ makes a lot of sense. Appreciate it!
@Paul Sandhu thanks Paul, sounds like you have a good thing going on at that building. Chicago limits STR units at 25% of total building units, so LT will always be the majority unless someone doesn’t follow the rules. Appreciate the reply!

@Mark Kappelman I agree your current tenants will not like it. Some might ask to get out of their lease. When this happened i allowed them to get out.

I would assume any future prospective tenants if you let them know in advance they will be open to it.

Just sell it is corporate housing, you screen guests and background check on all guests, you require minimum x days, and your marketing to high end familys etc.