Airbnb: What to Know Before You Rent Your House

Turning your home (or a separate house you own) into an Airbnb is a great way to make a little extra cash on the side. But there are a few things you should know before you start taking reservations. From getting the proper insurance to making sure each guest’s stay goes smoothly, here are nine things you should know before renting out your house.


It’s undeniable that renting your home while you're not there is a great way to make some extra money—but you’ll need to pay taxes on that income. More than likely, the website(s) you use to list your rental will report their income to the IRS. If you don’t file the proper paperwork, then you’ll probably get a letter about it in the mail. The only way around paying taxes on your Airbnb is if you rent your home out for less than 15 days of the year, and even then, you’ll need to provide proof to back it up.


An ordinary home insurance plan will not cover any damages that occur during short-term renting. Fortunately, Airbnb provides its homeowners with a $1 million guarantee. Even with the guarantee, the policy doesn’t cover every risk factor and special item. Make sure you check all the insurance plans you have before renting out your home and adjust them as needed.


A modern living room looking out onto an ocean.

Furnishings and amenities play a huge role in attracting renters to your Airbnb. You should think about two things when furnishing the space: appearance and function. The furniture should be able to withstand a lot of abuse. After all, if the furnishings are easily damaged then replacing them could break your budget. Your home should also look appealing and stylish to potential renters, making them want to stay there over other options.

House Rules

You should come up with clear and concise house rules for your Airbnb. This list of instructions should inform the renter (in a friendly manner) what is expected of them during their stay and when they leave. For example, you may want to include a no smoking and no pets policy in your home and have the renters take out the garbage when they leave.

Extra Charges

Before you start calculating your potential margin line, remember that Airbnb charges a three percent transaction fee. (Other websites charge a higher fee and even make you pay for advertisements.) You should also consider all the supplies, such as toilet paper and hand soap, you will need to restock after each guest leaves.

Cleaning Up

A yellow bucket of cleaning supplies next to a woman with a mop.

Keeping your Airbnb clean is another important aspect of owning a short-term rental property. You can either clean up after each stay yourself or hire a cleaning company to do the work. Either way, it will take you time and money to keep your home in top shape year-round. If you rent out your home for long periods of time, it’s beneficial to have a professional cleaning crew take care of the home and linens after each stay.

Legal Issues

You need to check with your local ordinance office before you advertise on Airbnb. Your town might require a special permit to run a rental home, and renting without one could cost you thousands of dollars in legal fees. You may even need to fulfill certain aspects of the license before renting out, such as improving your building or bringing everything up to code.

Account for Time

Time is a major obstacle for many Airbnb owners. You often don’t get a lot of time between guests to make the appropriate adjustments, especially if something is damaged or stops working. If you plan on fixing problems yourself, then keeping in contact with guests and making sure things are fixed in a timely manner is of utmost importance.

Screen Your Guests

It’s always a good idea to screen your guests ahead of time. You can do this by checking the guests' reviews on Airbnb and making sure nothing suspicious stands out. You can even rent to guests who only have positive reviews to help avoid a bad experience.