One Big Reason to Think Twice Before Renting Out Your Home on Airbnb

Many people like to turn to the gig economy to drum up extra cash. And seeing as how we're still dealing with lingering inflation, that makes sense.

A side hustle could be your ticket to boosting your savings when your cash reserves have largely been depleted. And if you're carrying a balance on one or more credit cards, a side gig could make it possible to eliminate it or at least whittle it down.

Now, there are different options you can explore in the realm of side hustles. But one route you may be interested in taking is renting out your home on a site like Airbnb.

If you'll be traveling for a bit of time, you may be inclined to have someone pay to stay in your home while you're away rather than simply have your home sit vacant. Or, if you have a separate area of your home you can rent out as you please, like an accessory dwelling unit (ADU), then you may be inclined to list it on Airbnb and hope to find a short-term tenant.

The idea of scoring some cash by renting out your home might seem appealing. But doing so might also backfire on you.

When your tenant refuses to leave

Most of the time, people who rent homes on a short-term basis through sites like Airbnb arrive when they're supposed to and leave when their stay is up. But you still run the risk of having someone occupy your space and refuse to vacate it when they're required to.

Such a thing happened to a Los Angeles homeowner named Sascha Jovanovic. Jovanovic rented his accessory dwelling unit (ADU) to a tenant via Airbnb whose stay was supposed to end in April 2022. As of October 2023, that same tenant was still occupying that ADU and hadn't paid rent in over a year.

Since the ADU in question was subject to different code violations, Jovanovic is not legally allowed to evict that tenant -- a tenant who, incidentally, will not allow Jovanovic access to the unit to bring it up to code. Also, Los Angeles recently adopted an ordinance that requires landlords to pay relocation costs for tenants they wish to evict without a legal reason.

You'd think an unplanned extended stay without rent payments would qualify as a legal reason. But apparently, they don't. And now, Jovanovic is stuck in a major bind.

Be careful when renting out your home temporarily

Renting out a home on a short-term basis might seem like a good way to make quick money. But before you go that route, make sure you're aware of the repercussions that might ensue.

To be fair, Jovanovic's case is an extreme one, and there are certain ordinances in place in LA that don't necessarily apply to where you live. But still, you wouldn't want to land in a sticky situation where you have a tenant who's able to argue that they have the right to stay in your home.

If you're going to rent out your home on a short-term basis, it could pay to spend a small amount of money to have an attorney draft an airtight rental agreement to avoid landing in a situation like Jovanovic. That way, you can have every short-term tenant sign that document before they're able to occupy your home.

And if you decide that you'd rather not run the risk of welcoming a short-term tenant into your space who doesn't leave, then you can always look at other side hustles that may be less risky. Remember, renting out your home can be time-consuming because you have to clean it before and after guests arrive and deal with all sorts of logistics. So you may find that you're able to earn a decent chunk of cash by putting in the equivalent number of hours at a different gig.