10 questions to consider before renting out a room - part 1
An attorney friend approached me, “I have a great topic for your next article. With the city approving short-term hosted rentals people need to know what they are getting into.”
I was intrigued by his comment as he proceeded to unpack for me the laws governing an innkeeper and how that compares to a landlord-tenant relationship or the renting of a room in an owner-occupied home.
Demand is growing to legally rent an extra room in your home. With new websites like Airbnb, HomeAway, VRBO and craigslist the opportunity is much easier.
The Napa City Council adopted a new ordinance allowing short-term rentals hosted in homes with the proper permits. This ordinance, effective December 3, will allow 60 homeowners to rent out a room on a short-term basis.
There are three categories of renting to an occupant: an innkeeper renting rooms in his hotel to guests, renting a house as a landlord for longer than 30 days to a tenant and a homeowner renting an extra room in their home as a host to lodgers.
Renting a room in your home creates a new situation for you legally and financially. Additionally, there are differences from that of an innkeeper or landlord. An innkeeper, one who operates a hotel, is a business and has several licenses, permits, insurance, inspections, etc. to maintain. A landlord is governed under the laws of the landlord-tenant relationship.
Here are the first two of ten questions to consider:
Is my occupant a lodger, a guest or a tenant?
A lodger rents a room from the homeowner who lives in the property and “hosts” the lodger, a guest would book a room in a hotel operated by an innkeeper and a tenant rents from a landlord. This is a straight-forward question you should know as it determines the structure of your business and whether you will be operating in a lawful manner.
Is there a lease or a license?
A guest in a hotel is there by license from the innkeeper, which provides certain rights to the innkeeper if the guest overstays occupancy. Landlord-tenant law applies to periods longer than 30 days when renting a house and is covered by a lease agreement.
What instrument is used when a lodger occupies your room? When using Airbnb, for example, there is no clear contract between the host and lodger as to your policies and rules.
What happens if a short-term lodger in your room turns into a tenant by occupying for 35 days? The laws on how to handle this occupant may have changed because of the length of stay.
Being that this is such a hot topic not only in the Napa Valley, but throughout the nation and world I want to be sure to give you all the details. Please watch for my next article where I ask questions about property rights and control of property as well as others.
Photo: CC0 1.0 Universal (CC0 1.0) Public Domain Dedication