Can You Airbnb Your Primary Residence? Pros and Cons

Short-term rentals can be potentially profitable for dedicated real estate investors. But what if you don’t want to buy an entire property to rent temporarily and inconsistently? Well, you can Airbnb your primary residence. This strategy is popular for those who travel often or just want extra income and don’t mind visitors. If you have yet to hear of it, read along as we go over how to Airbnb your primary residence and the pros and cons of this strategy. 

Main Takeaways

• You can rent out your primary residence on Airbnb, but short-term rental laws, licensing requirements, and restrictions vary by location.
• Renting your home to short-term guests can provide extra income and flexibility, but it may also increase expenses, maintenance needs, and wear and tear.
• Before listing your home, consider local demand, operating costs, available amenities, seasonal changes, and how you’ll manage the property while you’re away.

 

Can You Airbnb Your Primary Residence?

Whether you’re a Washington, DC property management company, rental investor, or a world traveler, you’ve likely heard of Airbnb. Likewise, you’ve probably heard how profitable it can be for those renting their investment properties. But can you Airbnb your primary residence and join in on the profits? 

First, you need to check your local laws. Some jurisdictions prohibit short-term rentals, some require licenses, and some have specific rules on how many days you can rent out your property. For instance, some Maryland jurisdictions require short-term rental owners to obtain a license or permit before hosting guests. Because requirements vary by location, check your local short-term rental regulations before listing your primary residence.

Additionally, depending on your location and property, you may also need to meet tax, zoning, recordkeeping, or HOA requirements. Check the rules that apply to your home before accepting short-term rental guests.

Short-term rental definitions and restrictions vary by jurisdiction in Maryland. For example, Baltimore City has specific rules governing short-term residential rentals, including licensing and primary residence requirements. Check your city or county’s current regulations for occupancy, licensing, and other restrictions before listing your home. Generally, short-term rentals are listed on sites like Airbnb, VRBO, or Booking.com. 

Pros and Cons of Renting Your Primary Residence on Airbnb

Using your primary residence as an Airbnb has its pros and cons. Some people wouldn’t even consider letting strangers into their primary residence. However, there are several benefits for those who don’t mind sharing space. So, read along while we review the pros and cons of listing your primary residence as an Airbnb. 

Benefits of Renting Your Primary Residence

• Extra Income- Renting your primary residence while you’re traveling or have unused space can provide an additional source of income.

• More Control and Flexibility- Instead of stressing about having your property booked 24/7, renting your primary residence is less stressful since you live there anyway.
• Meeting New People- If you plan on staying in the property while renting it out to travelers, you can meet new people. 

Disadvantages of Renting Your Primary Residence

• Higher Utility Bills- Inviting others into your home will cause your expenses to increase. For instance, you must cover your Airbnb guests’ utilities, cleaning, and other maintenance costs. 
• More Property Maintenance- More traffic in your home means more maintenance. For instance, higher traffic in your home means things wear down more quickly, and you’ll need to replace things more often. 
• Unpredictable Profits- The income you get from your Airbnb can be irregular and unpredictable. Unlike long-term rentals, you might not have someone to occupy your property on all the available days. 

Prepare Your Primary Residence to Become an Airbnb

Hosting guests in your primary residence via Airbnb can be costly. Although you’re not buying a separate property to rent out, you must still prepare your home for guests. For instance, you’ll need to prepare your home for high-quality photos. Now, this seems like an easy task, but it’s essential to carefully consider the images you upload. For instance, remove as much clutter as you can. Additionally, consider going for neutral or minimal decor so your guests feel more comfortable and less like strangers in your home. 

Before taking photos of the property, you’ll want to deep clean each room. Besides the typical vacuuming, mopping, and dusting, you’ll want to go above and beyond to make your home as clean as possible–almost like a hotel room. It might be easier to hire a cleaning service to do the work for these tasks.

Once you have a clean space and excellent photos of your property, you’ll want to create an excellent description for your Airbnb listing. First, consider taking up-close photos of some interesting or appealing parts of your home to highlight them for potential guests. Then, you can list your property and wait for guests to book your available days. 

How to Prepare for Guests

Someone booked a stay at your Airbnb–fantastic! Now, it’s time to prepare for your guests. This step could differ depending on whether you’re at the residence or will be gone. For instance, you’ll want to safely put your personal items away if you aren’t around. You may consider getting a lock box or storing personal items in a room that’s not accessible to guests. 

Additionally, you’ll want to prepare for guests by buying waterproof mattress covers, providing a key lock for easy guest access, and putting away personal photos and other belongings. For instance, you don’t want your personal property, like family photos in the living room or clothes in guest closets. Hosts may also consider permitted safety or monitoring devices, provided they comply with applicable laws and the booking platform’s disclosure and privacy requirements.

Hosts should also follow applicable federal, state, and local nondiscrimination laws, along with Airbnb’s Nondiscrimination and Accessibility Policies, when creating listings, establishing house rules, and accepting guests.

How to Determine if Your Airbnb Would Be Profitable

You don’t want to dive into an investment method if you’re unsure how it’ll work or even be profitable. Instead, you’ll want to research extensively to determine if your primary residence would make a sound, profitable Airbnb. So, read along as we go over some ways to decide whether or not it’s a viable strategy. 

• Location- Location is everything for short-term rental properties. If you’re in a desirable location that travelers love to visit, your property will likely get rented more often and quickly. However, if you’re in a more low-key, less visited location, you may have fewer renters than you’d hoped.
• Amenities- Airbnbs with popular amenities tend to do better than those that don’t have desirable features. For instance, proximity to the beach or large cities is a huge attraction for travelers or vacationers. 
• Property Type- The type of property you have can also affect profitability. For instance, if you have a large property with more than one room available, you can set higher rates and earn more income. However, if you have a small property or renting just one room, you may set lower rates, resulting in lower profits. 
• Season- Depending on the time of year, your Airbnb can be more or less busy. For instance, demand can also change throughout the year depending on your location and local travel patterns. During periods of higher demand, you may be able to increase your nightly rate, while slower periods may require more competitive pricing. As such, you’ll likely see higher profits during those months. Hosts can generally adjust nightly rates based on seasonal demand, local events, competition, and other market conditions.

FAQs About Renting Your Primary Residence on Airbnb

Renting out your primary residence on Airbnb can be a convenient way to earn extra income, especially when you have unused space or travel frequently. However, hosting short-term guests also comes with rules, expenses, and responsibilities to consider. Here are answers to some common questions about using your primary residence as an Airbnb.

Can you legally Airbnb your primary residence?

In many locations, you can use your primary residence as a short-term rental. However, local laws may require a license or permit and can restrict how or when you rent your home. Check the rules that apply to your property before creating a listing.

Do you need permission to Airbnb your house?

It depends on your situation. In addition to local short-term rental regulations, homeowners should review any applicable HOA or condo rules, insurance requirements, and mortgage terms that could affect short-term rentals.

Do you have to pay taxes on Airbnb income?

Short-term rental income may be subject to federal, state, and local taxes. However, federal tax rules include special provisions for homes that are also used personally. For example, if you rent a home you also use personally for fewer than 15 days during the tax year, the rental income generally does not have to be reported to the IRS. Because tax treatment depends on how the property is used and how long it is rented, keep accurate records and consult current IRS guidance or a tax professional.

Is Airbnbing your primary residence profitable?

It can be, but profitability depends on your location, nightly rates, occupancy, operating expenses, cleaning costs, platform fees, and other factors. Calculate your expected income and expenses before deciding if short-term renting makes financial sense for you.

What should you do with personal belongings when Airbnbing your home?

Store valuables, important documents, medications, and other personal belongings in a secure area that guests cannot access. You may also want to remove highly personal items and provide guests with clearly designated storage areas during their stay.

How to Manage Your Property When You’re Gone

If you Airbnb your primary residence while you go on vacation, you may wonder who will perform maintenance or check on it if anything goes wrong. Or, if you own several rental properties, you may feel overwhelmed performing management tasks at each one. That’s where professional property management can help, particularly for investors who own multiple rentals or cannot be available to handle day-to-day issues.

Check out our management services today

Bay Property Management Group offers comprehensive rental management services to landlords near Baltimore, Philadelphia, Northern Virginia, and Washington, DC. If you want to start or build your rental investment portfolio, look to the experts for management help. Contact us today to learn more about how we can help your rental business succeed.