June is here, people are either starting to plan or finalizing their Summer vacation plans. One of the newest and more popular activities for home owners during the Summer months, especially those who live in desirable locations (such as Saratoga/Lake George), is the short-term renting out one’s home. Online services such as Airbnb have made turning a home into a hotel a much easier to do. And it can be a very lucrative endeavor for homeowners.
However, there are very specific things you need to consider if you’re tempted to get into the home rental business:
A homeowner’s insurance policy covers YOU and members of your family for injuries suffered while in your home. But what if, through your perceived negligence, a person you’re renting to slips and falls while in your home? The legal costs to defend a claim against you will cost thousands of dollars, as will any final judgement against you. If you are considering becoming a short-term landlord you must check with your insurance company and make sure you are covered against any accidents that take place in your home while it is being rented. Laws governing short-term rentals to paying guests vary from state to state, and often by the number of times you rent-out your home per year. Vacating your home for a few weeks a year (while you’re on vacation) is different than actually running a pseudo-BNB business.
You also need protection for possible damages you may suffer while strangers are staying in your home. A landlord provision in your homeowners policy covers the physical structure of your property. If, for example, the “very nice” tenants you contracted with to live in your house for a week, trash the place – breaking windows, busting holes in walls, etc., these damages would be covered, to the extent of your premium.
What if, when you return, you find that some of your household items are missing or have been destroyed? You need to be sure that your coverage, as a “renter”, includes personal property. And all of these details need to be outlined, not only in your insurance policy, but in the contract you present to the renters. Make sure they understand what they are signing, and the legal responsibilities they have as tenants.
Short-term home rental can be a quick way to make some nice money, if done correctly. If you’re thinking of renting-out you home for a week or two, or the entire Summer, give us a call – (518) 436-0775 – and we’ll make sure your Home Sweet Home stays that way.
The Proskin Law Firm: The Experience You Need – The Expertise You Deserve.