Thinking About Renting Your House Out? What You Need to Know
We here in the Palm Beach area are lucky to live in a place people love to visit! It’s full of sunshine, beautiful views, sandy beaches, great bars and restaurants, and so many fun things to do. Everyone loves to travel — including, we’re sure, you and your family. If you’re thinking of going away, a great way to cover some of the expenses of your trip could be to rent out your home to someone looking to vacation in sunny Florida. If that sounds like something you’d be interested in, we’d like to offer you a few useful tips and things to keep in mind to ensure it’s a smooth process.
The first thing you’ll want to check before deciding to put your house up for short-term rental is whether you’re actually allowed to do so. Some towns or homeowners’ associations prohibit such rentals. So before making any other considerations or preparations, inquire about whether it’s actually an option for you!
Assuming you have the okay from your town to list your home on Airbnb or another vacation rental website, the next thing you’ll need to do is get a license from the Florida Department of Business & Professional Regulations (DBPR). This is a legal requirement in the State of Florida. The type of license you’ll need and the cost will depend on whether your lodging is considered a condo or dwelling, and how long you plan to rent it out for. You can look at theDBPR’s website for more information.
You’ll also want to consider the reporting protocols on rental income for tax purposes. As far as the IRS is concerned, if you rent your property for 14 days or fewer in a year, you don’t need to pay federal taxes on that income! It’s only if you earn money from a rental property for longer than 2 weeks that you need to report it as income. However, state and city/town taxes are a different matter. You’ll want to research what percentage of your rental income will go to the State of Florida or the city/town where you reside.Airbnb’s State of Florida page has some useful information and links to help you figure out licensing and taxes.
While it’s free to post a listing on Airbnb, you should also be aware that once your unit is rented, Airbnb will charge a service fee (normally 3%) to cover payment processing costs.
Both Airbnb and the DBPR have requirements about the upkeep and cleanliness of rental properties. All dishes and glassware must be disinfected between guests. Soap must be provided. Airbnb recommends that you provide bedding and towels, which must be cleaned every week or between guests, whichever comes first. Of course, other cleaning will also need to take place between guests. Since presumably you’ll be away, you have the option of hiring professional cleaners and adding a cleaning fee onto the price of your rental.
Naturally, having strangers in your home presents certain risks. You’ll want to be sure that your property is insured against damage and other liabilities. We recommendcontacting your agent to discuss making sure you’re protected, since depending on your policy and circumstances, you may not be completely covered by your homeowners’ or renters’ insurance.
We are linking the Airbnb help page for hosts here:Airbnb Hosting Help, so you research more to see whether covering some of the cost of your next vacation by renting out your home while you’re away is a good idea for you. Your friends atReNu Insurance hope that you’ve found this information helpful, and that, regardless of whether you decide to rent out your home, you have a relaxing, fun vacation planned for this year!