Airbnb is an international 10-billion dollar tourism enterprise that can offer people pretty decent additional income for renting out their home or a room in their home. This home-sharing endeavor appeals to travellers who are either on a budget or want that feeling of being at home rather than living out of a hotel room. For hosts, Airbnb affords additional income that could help pay off mortgages or offset monthly expenses. It’s a great way to make a little extra cash. But before you take the plunge and become a host yourself, we have compiled a list of important topics to consider.
1) Are you actually allowed to host your property on Airbnb?
If you own your home, then the answer is yes. It’s your property; you can do what you wish to it. However, if you own a Condo, you may actually be restricted as many condo boards have explicit exclusions on subletting your condo out to others. If you are renting your property, then most likely the answer is no. Even so, check with your condo board or your landlord before you decide to share your home. It’s best to keep your home-sharing venture on legal terms to avoid any issues down the road.
2) How much work is really involved?
Consider what type of amenities you would expect if you were paying to be a guest at someone’s home: You would want clean, fresh linens and towels, a clean room and bathroom, and possibly a kitchen to make meals in. Although many amenities you offer your visitor can be determined by yourself ahead of time, remember how valuable a good review can be to get you more guests and ultimately more money in your pocket. Do you want to do the pre-cleaning and post-cleaning yourself? Or would you want to hire a cleaning service? Are there any alterations or renovations you need to do with the space before you host? Try to weigh out the pros and cons of becoming a host and the work involved versus the income you could potentially gain.
3) What kind of insurance do you need?
What happens if the property was damaged or vandalized? Who covers that type of loss? The answer is, Airbnb covers it. They have their own insurance liability coverage called the Host Guarantee which covers up to $1,000,000 in damage. Even so, you should still check with your home insurance policy and let your broker know that you will be renting out your home to Airbnb guests. If you are gone most of the year, and using your home primarily for renting out to Airbnb guests, then contact your insurance broker as soon as possible, as you will need special coverage for this. If anything was to happen to your home, and you did not have the right coverage, you could be denied the claim.
4) Do you need to claim your Airbnb income on your taxes?
Yes, you do. No matter the amount of income you made on your Airbnb endeavor, you must claim it on your taxes. It is a source of income after all. In fact, these types of online ventures have become so popular that the CRA has been really diligent on tracking online expenses.
Becoming an Airbnb host is not only a great opportunity to increase your income, but it is also a way to meet great, interesting people from all over the world. For more information about home insurance or if you need a home insurance quote, contact us at 1-877-218-2008 and we will be more than happy to help you.