How to Start an Airbnb Legally

If you have a house or apartment that you don’t live in full-time, you may have considered renting it out to make some extra money. While the concept may seem simple, it’s important to know which laws will apply before you offer a  short-term rental on a site like Airbnb. 

Short-Term Rental Laws

Depending on where you live, the first thing to find out is what local laws say about short-term home rentals. These laws can vary greatly from state to state as well as from city to city. Some municipalities have very strict laws around rental properties, including popular destinations like Miami, Florida, and Santa Monica, California.

Even relatively lenient cities often still have some sort of restrictions. For example, New York City has laws that make renting for under 30 days without the host present illegal. This means that, although Airbnbs are technically allowed, anyone booking an entire house or apartment in NYC actually needs to stay for more than 30 days. Penalties for breaking short-term rental laws range from relatively mild to severe, with fines being the most common form of punishment. 

In many places, short-term hosts are required to register their properties and obtain a license or permit before renting them out. Registration typically includes paying various fees, complying with insurance requirements, and paying local occupancy taxes (in addition to the income tax from rental fees). 

If you’re looking for more information about the legality of short-term rentals in your area, Airbnb’s page “Responsible hosting in the United States” addresses many common regulatory issues. 

Other Considerations

While municipal laws and permits are the most obvious rules to follow, there are a number of other things to keep in mind if you want to avoid legal trouble. If not taken seriously, even rules that are not set by the government can still land you in civil court. 

Homeowners Associations 

In addition to state and municipal tax laws, some residential living communities like condos, apartment complexes, and housing developments all have their own rules, regulations, and bylaws that owners need to follow—including restrictions in a condominium development’s declaration. Although these associations may not have all the powers of the local government, rules can be strictly enforced through fines and civil lawsuits. 

Insurance

Double-checking that you have all the correct insurance is also essential before you list your property as a rental. This includes damage, liability, and any other relevant forms of coverage. 

Subletting

If you don’t own the property that you’re thinking of renting out, navigating the rules can be even more complicated. While it is sometimes possible to sublet a property that you’re renting long-term, many rental contracts and leases specifically forbid residents from subletting—including for short-term rentals like Airbnb. 

Know the Laws with BookLawyer

In today’s world, it’s vital to understand the laws that affect you. Whether you want to know how to legally start an Airbnb or need access to any other legal information, BookLawyer is your go-to source for free information and research tools. You can find helpful articles, browse explanations of 1,600 legal topics written by lawyers, and search large databases of your state’s laws (court opinions, statutes) to help answer any legal questions you have. To get started, just visit BookLawyer.com. 

Author’s Bio 

Neal Nagely is the founder and CEO of BookLawyer, a free legal information site for individuals and small businesses. Neal practiced law in Dallas, Texas for 10 years before creating BookLawyer to help people get answers to their legal questions and have affordable access to a lawyer when necessary.  

For more information, please visit Neal’s LinkedIn.