Should you rent your spare room or not?
Rather than take on an additional job, many have gone the Airbnb route to supplement their monthly income, but is it worth the risk?
Leasing out a spare room or entire property via Airbnb could bring in a significant amount of money depending on where you live in the country. Other home-sharing services such as VRBO, HomeAway, and FlipKey all work in the same way and focus on connecting property owners with renters via online.
But before you start advertising, or hosting on Airbnb, or on one of its competing sites, know it isn’t all unicorns and profits. You need to know being a host is more than just placing an ad and giving someone the key. In fact, things can go wrong at any time so you might want to educate yourself first.
According to the web site Wisebread.com, it reached out to several Airbnb hosts to find out some of the issues that could go wrong, as well as offer insight if you do decide to leap ahead. Here are some of those suggestions:
Renting your entire home or just a room to an Airbnb guest is like winning a lottery: You either win a lot, or you lose a lot. Yes, you may attract polite and conscientious renters who want to enjoy themselves without causing problems. However, you may also get renters who will never be happy even if you lay out the red carpet for them.
Many Airbnb hosts report that dealing with a bad renter is not unusual, but not typical. Before you decide to rent a room or your entire home, make sure you’re ready to deal with all kinds of people in addition to issues that may or may not come your way, the web site suggests.
One of the major components of any Airbnb business is its customer reviews and feedback from clients. While good reviews do attract new renters, bad reviews may cause the exact opposite. Either way, the review system is an important part of being an Airbnb host because it’s really the only way for new renters to know what renting from you is like.
Tons of Work
While renting out your room or entire property may sound like an easy thing to do, guess again. There is much to arrange before taking someone’s money. Things like: Listing your Airbnb property, hiring staff to keep it clean in between renters, and doing the paperwork. These are only a few things you will need to worry about as a property renter, the web site suggests.
Bottom-line: Renting an entire home or just a room can be a lot more work than one may realize. Unless you hire out all of the work, you’ll be the one doing laundry, cleaning kitchens, and making beds every few days. You will also have to be on hand to deal with future guests and be available to your current guests’ needs. There is no concierge service in other words, you are it. Depending on the number of units you have, you end up putting fires out a lot. It’s important to realize you must be ready to take action for a wide array of inconvenient situations when they come up, the web site suggests.
While tough tenants and late-night calls can put a damper on your experience, sometimes it’s the regular, everyday logistics of running an Airbnb that could cause your blood pressure to rise. Simple things come up like who is responsible for taking out the trash? Picking up old newspapers? Know your basics, the web site suggests.
According to the web site, Airbnb hosts are rarely prepared for the tax implications of running their business until Tax Season rolls around.
The web site suggests Airbnb hosts should set aside money to pay taxes on their Airbnb income. Also, new Airbnb hosts tend to be confused about what they can write- off and often try to write-off personal expenses that have nothing to do with their Airbnb. Instead, ask your tax preparer for suggestions about what you can and can’t write-off in terms of being an Airbnb provider.
Additionally, Airbnb hosts should know they will likely receive a Form 1099K in the mail showing their Airbnb income. Knowing about these issues beforehand may help you decide whether you want to be involved in a short-term rental on your property, or not, the web site suggests.