Airbnb was conceptualized to connect hosts needing a little extra cash with travelers seeking a more personal overnight trip. The rapid rise in popularity can partly be attributed to the fluidity of Airbnb regulations (versus the strict occupancy laws in place for traditional hotels). This, in turn, leads to concerns about affordable housing, hotel room night occupancy drops, and a loss of taxable revenue for popular host cities such as New York and Los Angeles. Before you list your spare room or vacation property, there are a few Airbnb regulations to consider.
Can I host Airbnb in my city?
Paris, Barcelona, and Berlin have all placed restrictions on Airbnb hosts, in an effort to preserve the residential districts of the cities for residents. Stateside, New York, San Francisco, Santa Monica, and Los Angeles are all instituting Airbnb regulations that would restrict the number of rentals permitted and the number of room nights each rental may sell. If you aren’t sure what your city policies are, check with your local city planning and zoning department.
Are there limits to the number of nights I can rent my space?
Each city has different policies regarding the number of nights hosts are permitted to rent their space. For many locations, however, local Airbnb regulations haven’t been fully codified. If you are in a location with a nightly limit, however, you may be able to have a permit to go over the limit. London, for instance, has a cap of 90 nights per year, while Japan allows up to 180 nights per year.
If you approach the nightly limit for reservations on your listing, there are a few options. You may “snooze” your listing, preserving those last few nights for high demand nights in your city. You can do nothing, and your property will automatically shut off. Any nights booked in a calendar year count towards your annual limit if you’re listed as “entire place.”
What are the Airbnb regulations for registering my property?
Airbnb regulations typically require a permit; depending on your municipality, there may be limits on the number of short-term bookings you may accept. If you live in a rental property yourself, you may not be able to list it on Airbnb at all. You aren’t the homeowner, and your landlord may not appreciate this use of their property. In addition, if you aren’t the homeowner, you may not be permitted by the city to register as a host.
Your city’s government may not be the only regulatory body with authority to prohibit listing your home on Airbnb. Many HOAs prohibit homes in their neighborhoods from commercial use. Fines and penalties can be steep, so make sure you’re done your due diligence before listing your property.
Will I have to pay taxes?
Hosts in the U.S. already know that Uncle Sam always gets his share. Canada considers money earned from Airbnb rentals to be “rental income” and is taxed as such. Although there are deductions allowed, most Canadian Airbnb regulations require hosts to pay taxes. You’ll need to have documentation, including registration receipts, as back-up for your tax assessment.
Occupancy taxes for hotels are generally assessed by all U.S. municipalities. Your Airbnb rental is subject to those, as well, although Airbnb regulations for tax liability vary widely by state. Err on the side of caution, and speak with your city’s Department of Revenue to make sure you’re compliant. At the moment, nearly 700 cities are partnering with Airbnb to collect taxes – the company will collect the taxes for the city, so you, the host, don’t have to worry about the complicated tax code.
Do I have to live in my Airbnb rental?
Many cities require hosts to live in the Airbnb rental in order for the property to be listed at all. This varies by the city; for instance, New York doesn’t allow properties to be rented for less than 31 days. If talk about landlords with multiple rental properties, the regulations for fair housing include how long a lease must run. For rentals longer than 90 days, the laws change, and those rental nights aren’t counted toward your total Airbnb rental nights.
If you live on the property and are simply renting a room, then regulations change. Some cites may not have permit regulations on the books yet, although you may have to pay taxes, as your rental income is considered taxable income by the IRS. Check with your local government to be sure.