Has anyone run into any issues from local government? I know that there have been several issues in Ohio concerning hosting and was wondering if anyone has had any similar experiences.
We do too. It’s just my opinion, I know, but running AirBnBs that are illegal in any way (local government or HOA or whatever) is what’s giving Air a bad name.
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Yes. I talked to all our council people and learned the legislation. I also tried to gather all hosts, and provide input on what other towns are doing. It takes some energy and involvement in local politics.
I suspect the question’s more about places where the law is not clear-cut. In many places there simply is no relevant law at all on what we do as hosts. For example, there can be taxes on running a hotel (but it’s not a hotel), guidelines on providing accommodation such as fire exits (which might not apply if it is your own home) and building management rules that become a grey area for allowing access to non “residents”, since our guests really are not residents.
We hunted high and low and can’t actually find a law or city ordinance preventing us doing what we do because laws haven’t caught up with 2016. This means we’re operating in a loophole, which applies to many, many hosts. As for the taxes, that took six months of back and forth before we got a ruling on what tax method is appropriate, because even they didn’t know whether it was taxed as rental income or as a business income, there was nothing in their guidelines for such short stays.
I had a huge problem in New York where the laws are not as clear about airbnb. Unfortunately you need to follow the news as things change constantly.
They weren’t operated by every man and his dog in the past and didn’t happen out of (for example) one bedroom flats just while the owner was out of town for the week. The AirBnB concept is… new.
I’m not sure why you have taken issue with me merely stating the facts.
There is a legal difference between “guest” and “tenant”. One is a resident, one is not. Council regulations, tax laws and indeed state laws cannot be expected to deal with the future, and accordingly they were not written to account for the two-day stays in residential homes which are now happening.
It so happens that I am allowed to have tenants in my property (for example if I took it to a real estate agent and signed a one year lease). It is explicitly dealt with in law. Having guests is not, but neither is it disallowed. So I host on AirBnB because I can. I am no different to the vast majority of AirBnB hosts in this regard. You seem to be assuming that just because nobody can stop me, that I have no regard for my neighbours, but that is not the case. I will (and have) declined and even cancelled VERY lucrative bookings because I believed they might be disruptive to my neighbours. So you may take your pitchforks elsewhere.
I agree with you. Our town had a lack of legislation, and that was why I made pro-active decisions to get involved. My first decision, made 6 years ago, was to charge and submit the same taxes that local hotels pay. This has served me well, and established our rentals as legit. That removed the hotels and motels from complaining about the lack of a level playing field, and demonstrated commitment to our community. Money talks in govt. I also operate “under the radar”…by that I mean I am diligent in ensuring that our guests are not disruptive to normal neighborhood activity. No parties, no on street parking. etc. Finally, I engage with town and planning department to adapt to acceptable town standards, and to guide and adhere to future changes. Activity does not need to be “permitted” by govt. It just can’t be “prohibited”.
Absolutely. I’m well aware that many of my competitors are probably not paying the correct amount of tax. But I approached the tax people here with 100% full disclosure, asking to get a proper ruling from them. They had trouble actually answering me. There still isn’t a “correct” tax arrangement for what I do in the relevant legislation, but I now at least have written guidelines from them and they know I’ve done absolutely everything I can to pay accordingly. It’s not a perfect world but we do our best.
Wrong, actually. A guest is not a tenant. They don’t sign a lease which grants either them OR me with the legal rights and obligations covered under the residential tenancy act. They don’t pay water or sewerage fees, they don’t have to sign a contract for electricity or arrange their own internet access, they don’t get use of the apartment’s attic storage space, they don’t have to do their own linens, they’re not obligated to take their rubbish outside, there is no deposit on the keys, they don’t have to clean to get their bond back, they don’t have to supply their own furniture, the list goes on and on. It’s childish to suggest I have “two-day tenants”. They are not tenants. I am not supplying housing, I am providing a service. I am no more a landlord than the Hilton is. And unless you’re an expert on the law in this country (which I gather is not your country from your spelling - there are more than one of them in this world) then you don’t know what you’re arguing about.
I am not circumventing anything because I am not what you seem intent on inferring that I am - some sort of cheat of the system? I operate 100% within the law as it stands. Were I obligated to make it a tenancy, it would be possible under current tenancy laws - but ridiculous and stupid given all the things I noted above. Next you’ll be telling us that public transport operators are used vehicle salesmen for twenty minutes, not just carrying passengers.
Hum. I am somewhat skeptical that there may be some places in the western world where there is no regulation for vacation rentals and boarding houses.
Airbnb allows hosts to sign a tenancy agreement with guests should they want to. When you rent a vacation home, you get a furnished home, complete with clean linens and there’s no need to arrange a contract for utilities. And you’re no less a tenant.
In my opinion people who overthink this legal context are just people who want to rent a property or a room on Airbnb despite local regulations which do not allow Airbnbs.
So we can’t have looked into the legal situation because we were about to spend six figures on a property and wanted to ensure we would not be breaking any laws? Everyone’s a criminal if they know anything about local laws are they? And again… countries don’t all do things the same way. Have a quick look at VRBO and you’ll notice that oh, about 100 countries aren’t really included much. But by all means find me the “vacation rental” regulations for my neck of the woods, I’m sure you speak nordic languages fluently?
Elen, how have you stayed up to date with the changes?
Has you move to work with the city been successful? What kind of challenges have you faced?
I am not sure of Robert’s point, but the simplest and most correct decision is to charge and submit the exact same tax that a hotel in your town collects and submits. If your business ( renting through air) is not on the local legislation as illegal, then for now it is legal. The best way to know that is to consult with your planning dept in your town. If it is not illegal, submit hotel tax value. Then you are not shortchanging the town, nor upsetting the local hotels.
We face every challenge you can imagine. Of Course, there are citizens who hate the rentals and they are vocal about the negatives. I worked with town council to garner support, and then during elections the majority got voted out and we started fresh again. The town commissions holds public meetings where everyone gets to express opinions. I joined a committee to show I was a valuable citizen. We work with STRAC ( SHORT TERM rental advocacy center) and they are helpful. I message everyone through air, and have a mail list of local owners, and the air reps also call hosts for us. HA sends out bulletins of upcoming meetings, and we gained funding for an economic study. So you must “get involved” if you want to create change or ensure protection. You have to reach out and find the sources available. My personal goal is to make sure that if change ever does happen, that my properties are grandfathered in.
You can’t simply choose how you would like to pay tax. You have to follow tax law… and since we are not a registered business we must pay individual tax rates (which are higher, but have less paperwork, which we are fine with).
Which country do you live in ? That’s a sincere question. I am sincerely surprised that there are places in developed countries where there is no regulation when someone wants to rent a house on the beach for his summer vacation as this is a very basic need.
It could be interesting for all hosts to compare regulations in different places, just out of curiosity. Especially if some hosts on here are “host advocates” in their own community and work with their local authorities to define new regulations, regulations from other places could be case studies.
For instance, I am in France, these regulations are voted at the national level and are very simple (I thought that we had the most complicated and outdated administration in the world) :
- If you rent a housing unit (house, apartment, studio …) for less than a 1-year lease, it is a “touristic rental”.
- You are entitled to rent your own primary residence, as a whole unit, for up to 120 nights/year (over 120 nights, it’s no longer your primary residence).
- You are entitled to rent one or multiple rooms within your primary residence for as many nights as you want.
If the place you rent as a touristic rental is not your primary residence :
-you must register your place at your town hall as a touristic rental
-your rental must not be your tenant’s primary residence
-it must be fully equipped down to cutlery
-you pay your town a tourist tax on a guest per night basis.
-your rental income is a non-business commercial income, and there is a dedicated line for this on your tax papers.
-you may get your place inspected and rated by the Ministry for Tourism (1 to 5 stars, like hotels) and you get a tax exemption on 71% of your rental income if you do so.
-you must sign a rental contract unless your tenant booked your place online
-in larger cities (>200,000 inhabitants, + inner suburbs of Paris), you must get an authorization to turn a housing unit into a touristic rental and may have to purchase “commercial” rights to do so.
Besides the last two points which were added lately (in 2014) to account for the rise of Airbnb, all the laws related to touristic rentals have been in place for a loooong time, because people have always been renting vacation homes for a week or rooms in local farms for a night.
So, my way to handle local legal issues has been to purchase a condo in an outer suburb where I did not have to get an authorization (that’s a six figures investment for me as well). Then I simply followed the registration and inspection process.
But I know that many hosts in my area do not care to follow the law, even if in our case, the law is clear-cut.
I believe you may be confusing and intermingling “income tax” with “sales tax”. I am stating that yes, you can choose to pay your sales tax exactly the same as a hotel collects and pays. If you are not a registered business, or behaving as a legitimate business, then you should not collect money and benefit from a business transaction - which renting is. I guess I do agree with Robert after all. If you don’t collect and pay your tourist tax / sales tax or whatever it is called in your country, then eventually the hotels will resent your competition and lobby to be sure you are shut down.