How to Rent Out a Room for Airbnb

If you’re looking for a simple way to get started in real estate investing but don’t have the cash to purchase a new property, Airbnb may be the way to go. Plus, by renting out a single room in your home, you won’t have nearly the added expenses or need to worry about any capital gains taxes when you go to sell, as you would with a long-term rental house or apartment.


Aside from getting started in real estate, by renting out a room for Airbnb, you may also be able to generate extra cash, pay off your mortgage more quickly, and meet interesting people from around the country — or the globe.

Things to consider

First, make sure renting a room in your home is legal in your community. Your city may require a business license in order to do so and will likely require that you pay occupancy taxes on any income you make as a result. Along with local taxes, you’ll need to pay federal income tax — but you also get to deduct any associated expenses.


If you have a homeowner’s association, make sure renting out a room is allowed and/or what rules apply when doing so. If you’re renting a house or apartment, check with your landlord before posting the room. Not doing so could result in a breach of your lease agreement and be grounds for your eviction.


It’s also a good idea to work with your homeowner’s insurance agent to get an additional rider on your policy that addresses renting out a room in your home via Airbnb or another short-term rental service. Although Airbnb provides a liability insurance policy, it won’t cover theft.

Getting your home ready

Now that you’ve decided renting a room on Airbnb is right for you, it’s time to get your home ready for a short-term tenant. While you’re just renting out a room in your home, you also need to prep common areas like a bathroom, kitchen, or maybe a living area depending on how you decide to word your ad. There’s no need to spend much time on these common areas, as long as they’re tidy, clean and accessible.


Spend a bit more time on the room you plan to rent. Invest in a nice set of sheets — several if you plan to rent it several nights in a row to different tenants — and even consider a new mattress if yours is particularly dated. Get rid of any clutter, and keep decor simple and sleek.  

Marketing your room

Once your space is spotless, snap some great photos of your entire home — not just the room you’ll be renting. Consider hiring a professional photographer experienced in real estate photography. Photos are one of the first things a guest views when determining whether to rent your space, so show off the unique aspects of your home, including any special touches such as morning coffee, soaps and shampoos or access to outdoor spaces or firepits.


Now, write your room’s description. Start with a title that grabs attention and speaks to the type of guest you anticipate will be interested in your space. After all, they won’t see your full description unless the title attracts them enough to read more. In your full description, be sure to mention any amenities you provide — like access to laundry, an iron, or bottle opener.


The key is to manage your guests’ expectations. While you should absolutely talk up the great things about your home and your friendliness as a host, you should also be upfront about any shortfalls of your home. This might include difficult parking, a chilly basement room, or the distance to local entertainment. If they know about these issues going into the stay, they may find them acceptable. If they expect a perfect place and are surprised when they don’t find that, however, you’re likely to get a negative review and fewer guests as a result.

Determine your check-in process

After they book, guests will want to know how they’ll check in to your place. If you don’t have a busy schedule, you may wish to greet your guests in-person. But, if you come and go frequently, you may be best served by investing in a portable key lockbox or a digital keyless entry system. This allows guests to check it at their convenience.


You’ll also want to write up some very specific instructions on how to find your home and access the lockbox or keyless entry. Taking some time to perfect these instructions will save you from panicked phone calls and lots of messages.

Staying safe

Since you’ll be letting complete strangers stay in your home, your personal safety should take priority. Although it’s not feasible to background check each guest, there are some steps you can take to ensure your guest isn’t dangerous. One option is to have Airbnb verify their identity by having guests upload a valid government-issued ID or connecting a Facebook, Google+, or LinkedIn account to an Airbnb account. While these aren’t fail-safe, they can add an extra layer of protection.


As a host, you also have the option of declining a reservation or even cancelling a booking if the guest doesn’t have sufficient reviews to ease your concerns. You may also wish to do some internet sleuthing.


You’ll also want to protect your property by stashing anything of large value in cabinets with a lock or a safe. While you may plan to be in the home anytime your guest is, this is still good practice and can give you a bit of peace of mind. Best not to give guests the opportunity.

Is Airbnb right for you?

Renting out a room for Airbnb isn’t right for everyone — particularly if you have a family or young children. However, many find Airbnb a fun, simple opportunity to take on a small real estate investment side hustle and meet people from all over the world.


If you’re on the fence, try it a time or two — then open up your home for more dates if all goes well.

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