It is important to run your business legally from the beginning. Obtain the required business licenses and permits. If you have a landlord or your unit is a condominium or co-op, make sure you get all the necessary permissions in writing.
Don’t try to fly under the radar here—you will get caught and all your investment and time will be for naught.
Local laws vary widely and change constantly. Make sure you research your area thoroughly. Issues to consider include:
How does your city/ town define a short-term rental? The definition of short-term rental usually depends on the type of structure you are renting and the length of stay that is considered “short-term” in your area.
How are short-term rentals regulated in your area? Certain jurisdictions completely prohibit short-term rentals; others may prohibit them in certain areas or limit short-term rentals in certain classes of dwellings.
What kind of permits and licenses do you need to operate a short-term rental? Jurisdictions vary in what they require, including a general business license, a short-term rental license, a sales tax account, etc.
Do any zoning laws apply to your rental? Make sure that there are no short-term rental zoning prohibitions that apply to your property.
Renters: approach your landlord with a plan
If you rent your space, you need to get your landlord’s permission. Read your lease agreement, and look for rules about subletting or guests. Approach your landlord with a plan. Make sure that you have researched the local laws and that short term rentals are legal in your area.
Let your landlord know that you are serious and dependable. Make sure you know enough about the Airbnb $1,000,000 Host Guarantee and $1,000,000 Host Protection Policy to explain them to your landlord and answer questions. Offer to collaborate with your landlords in creating rules that will ensure everyone is happy. Offer to share your listing and reservation details with your landlord, so they know who is coming.
If your landlord doesn’t react positively at first, offer to partner with them through the Airbnb Friendly Buildings Program, which allows landlords and hosts to collaborate on rules and share a portion of the rental income for building renovations, maintenance and improvements.
We are Airbnb hosts, but we are also Airbnb guests. We visited New York City recently, and this was at the end of an email from my host:
“Unfortunately, some HOAs and neighbors are behind the times and don't yet fully appreciate the shared economy. Please respect our wishes and operate as if you were personal guests. Please do not mention your vacation rental. Thank you.”
NEVER put your guests in this position. Nobody wants to pay for a rental to sneak around and hide from the neighbors. If you can’t get permission for a short-term rental, don’t put it on your guests to cover for you.
Your HOA or Condo Board
Once you determine that you can legally operate your short-term rental, if you rent or own a condominium or co-op, make sure you review your lease or condo documents. If you need to, get your HOA’s permission in writing.
If your rental is designated as public or subsidized housing, special rules may apply. Make sure you speak to the property manager about the possibility of renting short-term.
Local laws regarding short-term rentals in your area may not be clear-cut. If you have any doubts, call your accountant and the local regulatory agency and speak to someone directly.