An Airbnb rental agreement is a document that outlines the arrangement between a real estate owner (the owner or the host) and the individual willing to pay rent for a property over a particular course of time, known as the guest.
The terms of this rental agreement are fully negotiable, but once it is composed and mutually signed – it is considered a legally binding document.
There are several critical points covered under this type of rental agreement – and we’ve outlined each one in the complete guide to drafting an Airbnb rental agreement.
Stay tuned and find out everything you need to know about Airbnb rental agreement terms!
Why Would You Need An Airbnb Rental Agreement?
Let’s make one thing perfectly clear:
One day is all it takes for your new guests to damage your rental property.
You need to carefully draw up a contract if you’re thinking of letting someone stay on your premises.
Why?
As a property owner, protection is key, and that’s why hosts need this agreement before they can rent out their property. By asking your guests to sign an Airbnb rental agreement, you are obliging them to abide by certain “house rules.”
Although this agreement allows you to set some ground rules for your guests, the likelihood that they will be violated is not ruled out. That said, the consequences are also disclosed in the agreement.
Make sure your guests understand the basic points outlined in the Airbnb lease agreement.
Bonus Tip:
If you have several properties, you can’t rely on a single, one-size-fits-all rental agreement. Multiple properties will require multiple Airbnb rental agreements.
Vacation Rental Business 101: What Is A Vacation Rental Agreement?
On a related note, you might be curious whether the vacation rental agreement is the same thing as the standard Airbnb’s terms and conditions.
One thing they have in common is a short rental period.
In the vacation rental industry, guests sign and check in for a period of up to 30 days.
The role of this vacation rental agreement is to spell out the rules for guests, as well as penalties for breaking them. It has to meet state laws and the standard policies of the Airbnb platform. The latter covers most circumstances – but it doesn’t hurt to fill in some gaps to minimize risks.
Drawing Up An Airbnb: Points That Must Be Included
To successfully enter a contract and acquaint your guests with the terms, house rules, and obligations laid out, your short-term rental agreement should include a list of several crucial points.
Here’s a quick guide to drafting an Airbnb rental agreement.
1. Names Of Tenants And Occupants
Logically, the first point you should include in the Airbnb rental agreement is the full names of the parties who are renting out your property, along with contact information.
Whether these are roommates, two friends, family members, or married or unmarried couples, their names must be noted and are therefore considered responsible for the property in question.
Can a tenant be a minor?
In most cases, it is illegal to rent out a property to minors. According to most state laws, individuals under the age of 18 are not allowed to hold tenancy.
2. Description Of Property
A description of the property is a brief summary of all the specifications that are important for the tenants or guests.
A segment with the description of the property should include the address (building and unit number included), specific areas for storage, amenities, and areas that are off-limits for guests – if there are any.
On that note, what’s a listing description?
It’s essentially a well-composed description with the aim to highlight the best angles of your property while making it look professional.
That said, you should pay attention to the language – don’t make it ambiguous. Moreover, don’t make your property look different in the description.
When your guests check in, they should be able to pin down exactly what was mentioned in your rental agreement and the property description.
3. Maximum Occupancy
Your short-term rental agreement should specify the maximum number of guests that are allowed on your property. That also includes defining the sleeping arrangements.
Why is this important?
If your guest invites more people than is allowed per the rental agreement – or throws a party – and an incident occurs, or someone gets injured, this segment protects you, placing the liability on the guests.
4. Security Deposits & Fees
If you hope to avoid common misunderstandings regarding the payment details, make the following points clear in your vacation rental agreement:
- The dollar amount of the security deposit
- Ways in which you will or will not use the deposit (cover unpaid rent/damage the tenant caused)
- Time and manner for returning the deposit
- Non-refundable extra fees, such as cleaning fees
If any of the guests, regardless of the number, violates a rule or doesn’t pay the fees, you, as the host, have the right to demand the full amount from any of the other guests.
Even more so, due to non-compliance with the short-term rental agreement, you have every right to terminate the contract or seek legal action against the guest.
That’s why it’s extremely important to disclose these terms prior to booking.
5. The Right To Enter Property
Just because you rent out a property, it doesn’t mean you’re denied access to it. However, host access must be specified in the agreement to avoid claims of illegal entry or violation of privacy.
Your lease agreement should clarify your right to arrive at the property, stating that, for example, you must announce your arrival 24 hours in advance. Of course, in the case of emergencies, these terms can change.
6. Important Policies
In addition to the ground rules that must be found in your Airbnb rental agreement, there are probably other house rules you might consider important.
Some examples of such rules include:
- No Illegal Activities – Even out of context, this ban is self-explanatory. To limit and protect their liability, an Airbnb host can choose to prohibit drug dealing, drug use, excessive noise, and other disruptive behavior.
- No Smoking – As a host, you have the right to prohibit smoking. If there’s an area where you will allow smoking – like an open area – you should specify it.
- No Pets – Some Airbnb hosts’ rental agreements prohibit cats and dogs; others are pet-friendly. Either way, be sure to specify your pet policies.
7. Cancellation
What if your guests express that they no longer wish to stay on your rental property? In that case, you can terminate your guest’s stay and call it a day.
Regardless of the reason or the initial check-out dates, they’ll have to submit a cancellation notice in advance – and in writing. Just as your vacation rental agreement started in writing form, it should end in writing form, too.
8. Violation Of Agreement
This segment of the vacation rental agreement is intended for guests who violate any item of the rental agreement or cause damage to the property.
For example, it could state that damage to the property caused by the guest will be their responsibility. It can also support your right as a host to cancel their stay if they break the rules and conditions.
9. Limitation Of Liability
Accidents are inevitable – no matter how well you maintain your property.
What exactly does the limitation of liability mean?
Well, in case that accidents do occur, this clause essentially limits your responsibilities as a host to pay for the losses that occur during your guest’s stay. This segment should be drafted with care. So, Airbnb recommends that you consult your attorney and have them review your terms.
10. Extra Clauses
Regardless of whether it’s a long-term tenant or someone renting out your property for 30 days, you can add additional clauses that prohibit guests from accessing certain areas of the property.
These can include your private pool, garden, attic, and the like.
Do You Need Insurance To Rent Airbnb?
A short-term rental business has become a popular alternative for hotels. Guests have access to better quality accommodation – and in most cases, they’re met with lower prices.
However, before you put your property up for rent, you should at least consider Airbnb insurance. That means that you’ll have to buy a separate coverage to protect your property and limit your liability.
Short term rental insurance is the coverage you’re looking for – in addition to homeowners insurance, of course.
This policy helps you cover property and liability expenses while you’re having guests. Mind you, that doesn’t apply to your family and friends who stay at your property for free.
This coverage is designed for short terms rentals, though. So, you should rethink this option if you’re considering a long-term tenant.
How To Send An Airbnb Rental Contract?
Once you’ve drafted your rental agreement, it’s time to share it with your guests.
How do you do that?
The number one rule is to make your rental agreement available to guests prior to booking. Your guests should be able to go over the Airbnb rental agreement as a part of your listing description.
If the guests decide to go through with it, you’ll be required to send the same page to them once again, have them sign it, and send it back.
Remember:
The official rental agreement must be in writing, signed by the host and the guests to be deemed valid.
What Happens If You Don’t Draw Up An Airbnb?
As we’ve explained, this type of short-term rental agreement defines the rights and responsibilities of hosts and guests alike. It leaves no room for the “unknown.”
Not relying on a rental agreement can have serious consequences.
Unprincipled Guests
For starters, you could end up having guests that simply won’t leave the property. If you don’t have the rental agreement drafted out, with agreed-upon check-out times stated in it, you may end up having a nasty dispute with your guest.
An official lease agreement gives you an advantage in case you have to evict your guests formally.
Property Damage
Next, damaged property is always a possibility; it’s part of the vacation rental business. Your guest could damage your furniture and amenities, be it intentionally or unintentionally.
While you have insurance for that, the absence of a rental agreement might leave you paying for the damage caused to the property out of your pocket.
Expensive Attorney Fees
In the event of any disputes with your guest, you’ll have to go through the regular legal process, which could get pretty expensive. And if you don’t have a short-term rental agreement in place, you might be in an unenviable situation here.
Moreover, it’ll likely take your attorney more time to sort everything out and figure out how to defend your case against a guest – which, again, can cost you a fortune in legal fees.
Final Thoughts On Airbnb Rental Agreements
Short-term rentals are much more than an oral agreement between two parties. It needs to be drafted out properly, containing all the facts that are relevant to both hosts and guests staying at the property.
A couple of key points include names of the parties, description of the rental property, booking details, important policies, maximum occupancy, house rules, cancellation – you get the picture.
However, you have to make it available to your guests within your listing description before they make a booking.
Without a properly drafted rental agreement, you’re at risk of paying high legal fees, entering disputes with guests that won’t leave, and paying for property damage out of pocket. It’s a bad idea, overall.
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