Hosting own properties, thinking about expanding

Regulations/Tax Issues
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Hello All-

I’m new to this forum. This forum is a great resource to hosts. I hope to add as much value to this forum as I look to gain from it.

I currently own a few properties in Charlotte, NC. I host them on AirBnB and VRBO. I was recently reached out by some property owners asking me if I would like to host their properties as well.

I was definitely intriqued by the idea, enough to do the initial standard reconnaissance, i.e.) checking on hosting rates/commissions, scalability, 3rd party software, etc. The one question I came across that I wasn’t able to get a firm answer on, is if I start hosting other properties - do I need a real estate license? Or even a broker license?

I called the NC Real Estate Commission, but I’m still waiting for a response. Hopefully someone on here has an answer.

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Contacting the NC Real Estate Commission makes sense.

It appears to me – though I’m not qualified to give legal advice – that, strictly speaking, hosting properties in NC would require a real estate license, likely a broker’s license.

I say that because NC law says it’s unlawful to act as a broker without a broker’s license, and defines ‘broker’ as one ‘who leases or offers to lease’ . . . ‘or rents or offers to rent’.

I say ‘strictly speaking’ because my impression is that many people act as host for others without a real estate license and I’m unaware of widespread enforcement actions. Still, operating a hosting business without the required license(s) could put your business in jeopardy, especially in the event of litigation, say by a guest where the lack of a required license could be used to impeach your credibility.

Also, the North Carolina Vacation Rental Act contemplates licensed real estate brokers when it says in its 'purpose and scope of act section: “Rental transactions conducted by the owners of these residences or licensed real estate brokers acting on their behalf . . .” in Section 42A-2.

I don’t think you should rely on a response on this or any other forum.

You need to hear from the NC Real Estate Commission; if they say ‘no’ it would be great to have that response in. writing. ideally, if you choose not to obtain a license, you’d receive written advice from a licensed local lawyer who specializes in real estate.

You might find these posts and threads interesting generally: here, here. You might want to search the forum for similar topics.

I suppose that there’s an argument that if the property owner were the Host and you the co-Host, and the Host both enabled instant booking and approved all request-to-book (RTB) requests that you would be involved only in property management, not in renting. Many jurisdictions require a real estate license (though not a broker’s license) for property management. I didn’t look further into NC law to see what NC’s requirements, if any, are to manage real estate property.

Good luck in your business.

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@RealGP86 You aren’t allowed to drum up business for your company on this forum

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Thank you for taking the time out to respond. It was very insightful and definitely an eye-opener.

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Welcome to the forum!

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I received a call back from the NC Real Estate Commission. They said that you are required to have a real estate license to host someone else’s property.

Some other tidbit of info, that is interesting - I spoke to a lawyer and he said that he is not aware of any regulation that stipulates this requirement.

Sounds like its an issue of spirit of the law vs letter of the law. With that said, the lawyer did also comment that the NC Real Estate Commission is fighting to have it made into a law and he believes that it eventually will pass.

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Thank you for getting back to the forum on this update.

There might not be a regulation. But his not being aware of a regulation is different from him saying that it’s lawful to manage short-term rental properties for others (including – and this might be an important distinction – approving/rejecting guests). I wonder if you shared the logic I related to the lawyer whether he’d have a comment.

The bottom line would be if the lawyer would write you an opinion stating whether you need to have a real estate license or not[and what kind] if you were to act as Host or co-Host of short-term rentals, including accepting/rejecting guests, interacting with guests in a hospitality/customer service role, and managing the real property (e.g., identifying needed repairs, hiring contractors for repairs including building code compliance, arranging for housecleaning and managing supplies and communications/marketing/advertising with guests and prospective guests).

It might also be valuable for you to know the lawyer’s opinion on whether you’d need a real estate license in NC if you did not accept guests but did everything else listed above.