Short-term Rentals Can Be Lucrative, But Do Your Homework

Did you know that currently there are more than 1,000 possible short term rentals in the Washington area. Facilitated by the Airbnb Web site, VRBO and the like, out of towners can rent a private room, a shared room and even an entire apartment or house.

While this cozy alternative to the traditional hotels and motels is inviting, there are many critics and possible downsides to renting your home for short-terms. Condominium unit owners should check their association’s legal documents as most allow only 6 month or one year rentals and some don’t allow any rentals. Ignoring this advice could cost you thousands of dollars, just as it did Kyle Piers in Boston, whom rented his unit for $200-$300 a night and was fined $9,700 for breaking his association’s laws.

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Short-term rentals can be more lucrative than long-term rentals, thus depleting the housing stock for long-term rentals. The Department of Housing and Urban Development, parent agency of the low-cost FHA-insured mortgages, may remove approval status and eligibility if they find that short-term rentals are in a community. Boards should be clear about what they will and won’t allow, with feedback from the communities homeowners.

For homeowners that are thinking of allowing short-term rentals in their home, make sure to do your due diligence. First make sure you use a service that has a detailed vetting process that verifies the identity of your potential guests with forms of ID matching them to social media or other forms of verification. Contact your insurance company to make sure you are fully insured or use the insurance through the booking service you go with. It is best to personally contact potential guests and go with your gut, if you have any hesitation, don’t rent to them. Taking a security deposit is highly advised. Keep your valuables, important documents, and official forms of identification in a safe place, preferably not in the home you are renting.

If you would like more information about short-term rentals or anything real estate related, please do not hesitate to contact me. I am ready and available to help you and yours with anything I can and nothing is too big or too small, if I can’t help directly I will work to connect you with other competent and knowledgeable people who can. If you have stories, information, and/or thoughts about short-term rentals please add them for the benefit of all.

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