For those who own condos, townhouses, or single family homes, there are pros and cons to short term renting services like Airbnb.
There are important issues to consider before using one of these online rental services as a real estate owner in Florida. Things like:
For one thing, there is the question of taxes (sales tax, etc.). Short term rentals by home owners puts them in the business of providing lodging, like a hotel. Which means taxes be expected to be paid lodging related taxes.
However,Airbnb provides an on-site list of jurisdictions that impose these taxes, and Airbnb also collects and remits the taxes on behalf of its hosts. Florida (and some of its municipalities) expect to be paid these lodging taxes, and no – they aren’t the same as income tax. (Hosts may have to pay federal income taxes on their rental revenues in addition to the lodging tax (which may be deductible). Check with your tax advisor.
2. Do Condo Boards Like It?
Depends on the board and the Association. However, your neighbors may not like the idea of strangers traipsing through the condo complex using the common elements.
Whether or not you are allowed to sublet your condo in short term online rentals is covered by the condo’s governing documents.
Condo owners who jump onto Airbnb and start renting out their Florida condo may be surprised to find themselves subject to fines and other negative ramifications from their association.
3. Who Bears The Risk of Injury Claims?
Host, renter or the Association?
It is likely that Airbnb will not take on liability for the injury in the Airbnb rental.
Florida hosts and Associations need to understand the risk of someone being hurt or killed while renting their place. It needs to be evaluated carefully. Airbnb is offering a free $1,000,000 liability insurance policy to cover its U.S. hosts under its “Host Protection Insurance Program.”
However, this is insurance coverage that will take effect only after the home owner’s primary coverage has been used. It is “secondary” coverage.
A big concern for Florida home owners: the host’s homeowner’s policy needs to be checked, too. Many homeowner’s insurance policies will not cover commercial uses of the home, and these short-term rentals can be considered lodging for profit.
A good piece of advice if you have a question about Airbnb is to at least speak with an experienced Florida real estate and condo/HOA lawyer to learn about your rights.