There are many reasons that many homeowners decide to rent out their homes on sites like Airbnb, HomeAway, and VRVBO (Vacation Rentals by Owner):
- Additional income
- Meeting new people and travelers from other places
- The chance to vacation more yourself
- Getting use out of properties you own, but that aren’t currently being lived in
Still, the decision to rent out your primary residence or a second or third property should be a well-thought-out one. While there are rewards to undertaking this experience, there are drawbacks and severe risks as well.
Top Reasons to Be Wary of Renting Your Home to Travelers
1. Gaps in Insurance Coverage
The most important reason to think twice about renting your home has to do with insurance coverage. Many renters assume that the insurance policy outlined by sites like Airbnb will cover them in any and all risky scenarios. This is far from the truth.
For the most part, insurance plans like these are liability plans, so they’ll cover you if someone is accidentally injured while on your property. But as for your own property (what you are probably most concerned about), you’re not covered at all. And there are other gaps in coverage when it comes to these hosting sites as well.
2. Additional Necessary Insurance to Cover You
For the most part, it’s almost guaranteed that you’ll need additional home insurance, a rider or endorsement added to your home insurance policy, landlords insurance, and/or various types of business insurance to rent out your home safely.
3. Condo & Home Owners Association Blocks
It’s not uncommon for homeowners associations and condo associations to prohibit members from renting out their homes. You’ll need to check with your contract before moving forward if you live in one of these communities.
4. Privacy and Safety Concerns
Next, when you have someone going to your private residence or another property, there are certainly privacy and safety concerns to think about.
You don’t know this person or these people, and unfortunately, they can say whatever they want on their hosting website profile. It may or may not be true. Inviting someone who is a complete stranger to you into your home along with you and your family (or onto a property you own) could be inviting trouble.
5. Upset Neighbors
It’s possible that neighbors on your block and in your neighborhood will become upset that you’re renting your home out to strangers. This is usually because they will have the same privacy and safety concerns listed above.
6. Excessive Mess
Lastly, there’s the mess to consider. Even if you have renters who are relatively clean and well-behaved, they will inevitably leave your home, cottage, bedroom, or other property like a hotel. That means towels on the floor, trash in all the bins (and possibly on countertops and tables), old food in the refrigerator, and other messes.
Keep in mind this is something you’ll have to clean up. Even if you decide not to do it yourself, you’ll need to hire and pay someone to do it for you, and on your part, this will necessitate a good amount of correspondence with this person and trust in them to go inside your property, clean it up nicely, lock up, and leave it ready for your next renter.
Ask Your Insurance Agent Before Making a Final Decision
It’s possible that your home insurance may help you if you plan on renting out your home on a site like Airbnb, but you must check with your insurance agent beforehand because all policies are different. Speak with one of our Hopson Insurance agents today, and they will be able to let you know what coverage gaps you may encounter.