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Well way more than that. There’s maintenance, taxes, insurance, wear and tear, HOA fees and assessments, tax on the income, depreciation to write off and more. But an even bigger consideration is losing their home altogether because of a guest injury lawsuit and canceled insurance and then force-placed insurance of THOUSANDS more per month (this can happen within days of being canceled and suddenly you have thousands more to pay the next month, possibly then facing first: notice of default when you fall behind on one payment, and then acceleration of mortgage (calling the whole loan due) and then referral to foreclosure, where you are then “done” SOL unless you have a fortune to fight it by hiring attorneys. That can happen within as little as three months. I speak from experience.
I know I am coming down hard on you and you seem to be well meaning but if I were you, I’d do the following:
Discuss insurance with your landlord NOW. Insurance that protects him, not you. Maybe suggest Comet or Proper, because his standard insurance WILL NOT not cover Air activities, I guarantee that it will not–not in any universe. Make sure he knows this. If you don’t tell him, you are essentially taking advantage of someone who doesn’t sound too bright. Offer to pay it. I think insurance is waaaay more important, and indeed, essential than exterminating a few bugs. (I kind of feel sorry for your landlord… he seems totally clueless about what an enormous risk situation you are putting him in.)
Refrain from offering your “advice” to other renters. Most will simply sneak because they know doing Air violates their lease. Most won’t be as thorough as you are in seeking out suitable homes to rent out on Air. Consider becoming licensed if you intend to manage multiple properties.
Get your agreement with him in writing. Probably if you signed a standard lease, that no-subletting clause is still in effect. If he decides to evict you for whatever reason and your arrangement is not in writing you won’t have any recourse.
I too am curious about insurance. Does your landlord have an insurance policy that covers transient renters, or does he just have regular landlord insurance?
I know you mentioned you are responsbile for repairs, etc. What if the refrigerator or washer/dryer breaks? Will you be responsible for repairing and replacing if necessary? I ask this because 200 different renters are going to be harder on appliances versus 4 roommates who are used to them.
Your situation is in the minority in the fact that you went around speaking to different landlords and being open about it. I think if you are going to give advice to renters then you should be very very clear about this upfront. Obviously doing it without landlord permission puts the landlord at risk with liability, their neighbor relations, and really just anything else for that matter.
@konacoconutz, thank you for taking the time to educate and explain.
Even if there is no mortgage on the property, it can take a single Liability claim to wipe the homeowner clean and more if he does not have a comercial Insurance, which as we know is quite a bit more than regular Homeowners insuraqnce.
I purchased a Comet policy for our guest suite that is attached to our home. That way I don’t have to report anything to my Homeowners company. I have heard they will cancel you immediately if you make a claim for an ABB incident. Haven’t had to report anything yet but want to be prepared. It’s only $58/month and you can turn it off and on monthly if you don’t have anyone staying. For our condo in Mauna Lani I was able to purchase a seperate Homeowners policy that does cover paying guests for about $900/ year.
Kona attached this link to Comet’s website on another string. According to the below verbiage on Comet’s website they don’t replace homeowner insurance. They are an excess policy. When you put in a claim to an excess policy you have to prove that you’ve put in a claim with the underlying policy.
Although the home-sharing insurance will be primary, this does not replace a Host’s homeowners policy. In fact, the policy will provide excess coverage for the types of exposures not typically covered by a homeowners policy.
One thing that my have not occurred to renters is that if you host and put in insurance claims you may make the property difficult or impossible for the owner to sell.
Also, did you notice that if guests check in early or stay late, they are not covered under the insurance?
Very interesting about the claims. It would be very interesting to find out how any claims have been submitted to insurance companies over the years air has been doing business.
If you notice, they say that Air does essentially provide the same coverage as comet. But that if you rent on other platforms you aren’t covered.
Yes, I saw that Comet says that Airbnb’s coverage is only from check in to check out. I have always assumed that Airbnb would wiggle out of paying any claim so I don’t even consider myself to be covered by them. I have Safeco Homeowner Insurance and a Personal Umbrella Policy. I asked our broker if I was covered for liability for any loss incurred by Airbnb guests. To my surprise, she said yes my homeowner policy will cover Airbnb guests, but not any guests of my Airbnb guests. I couldn’t believe they were willing to cover Airbnb guests as I had a knock down drag out fight with them over covering my pit bull mix who in my completely biased opinion is the sweetest dog on the planet.
@EllenN, we have Comet because we needed something ASAP and I didn’t have time fo fully research the various insurance policies. But my understanding now is that Comet is for loss of income and liability only (i.e., guest is injured in your rental) and it would not cover structural damage to your home caused by a short term guest. I may be wrong, but it seemed from the policy that this is the only coverage.
I questioned the verbiage of the coverage and the president of Comet responded that your Comet coverage is “in addition” to your Homeowner’s policy and only applies to cases involving your short term rentals. It is “Primary” for these incidents and you DO NOT have to report them to your standard insurer at all. That is what Comet is for. You still need your Homeowner’s policy to cover other claims.
What you were told, if you understood it correctly is contradictory to this verbiage on the Comet Website under Frequently Asked Questions.
WILL YOU CONTACT MY HOMEOWNERS INSURANCE COMPANY IF I MAKE A CLAIM?
No. Your home-owners insurer will never be contacted by us. In the event of a claim, you will report the claim to your home-owners insurer, and then file the claim to Comet.
It’s intentionally confusing. Comet is saying that Comet won’t contact your homeowner insurance company. They are hoping that potential customers will believe that their homeowner insurance companies won’t be contacted. The procedure is that you report a claim to your homeowner insurance company. Your homeowner insurance company will deny the claim because they don’t cover the type of loss that you are reporting. Only after your homeowner insurance company denies the claim can you submit the claim to Comet which is what excess coverage means. So, Comet won’t contact your homeowner insurance company; you will contact your insurance company.
But wait… That procedure would indicate they provide SECONDARY coverage. And they claim they are PRIMARY coverage for STR?!! This is so confusing. I would not use them until this clause is made clear!
Someone else here said the president of comet assured them their homeowners would not be contacted by comet. But are they saying YOU have to be the one to contact them in the event of a claim? Are they wriggling out of that and putting that responsibility on the homeowner?
Here is the wording from the website that addresses primary/secondary coverage. They are primary for losses related to short term rentals that aren’t covered by homeowner insurance. The only way to determine for certain that a claim isn’t covered by homeowner insurance is to put in a claim with your homeowner insurance company. The words “excess coverage” always mean that you will be putting in a claim with the underlying insurance carrier.
Although the home-sharing insurance will be primary, this does not replace a Host’s homeowners policy. In fact, the policy will provide excess coverage for the types of exposures not typically covered by a homeowners policy.
Here is what I was told by Ivan Zhou, President of Comet, in an e-mail: "Your Homeowner’s insurer is never contacted by Comet. You have the option to let them know, but you don’t have to. Comet acts as your Primary coverage while you are home-sharing. We handle the entire claims process with our broker and carrier."
However, I admit I haven’t read the entire policy from start to finish. I need to do that and I suggest everyone do the same.
Wow, this conflicts with the information on their site. I would never use them if I had to report to the homeowners first. Then I would get canceled and that would defeat the whole purpose of having Comet.
