Renting on Airbnb with an FHA loan

[Evan DiLeonardi]

I'm looking to buy a single family home and rent it out on Airbnb when I'm not there. I travel a lot on the weekends and for work during some weeks. It will be my primary residence when I'm not traveling though.

My question is, am I allowed to rent it out on Airbnb when I'm not there? The FHA bylaws seem to restrict short term rentals but I've heard of people doing it so I wasn't sure.

Would it be easier to do 5% down conventional for a primary if I plan to Airbnb it? My goal is to reduce down payment, closing costs and the interest rate which is why I wanted to do an FHA loan if possible.

Thanks!

[Paul De Luca]

@Evan DiLeonardi

FHA loan rules do not permit rentals of living units in the home purchased with an FHA mortgage if those rentals are for less than 30 days. The Airbnb business model is not acceptable under FHA loan rules, which means that if you purchase with an FHA mortgage, Airbnb operations are a violation of the FHA loan rules.

Yes it would be better to do 5% down conventional if that's the strategy you want to follow. Not a big difference in down payment and you don't have that restriction.