Airbnb is one of the fastest growing components of the hospitality industry. We are offering Airbnb as a solution for may of our investors. Let’s cover some of the ground rules and requirements to participate in our Airbnb program.
There are some downsides that you need to be aware of before you jump into Airbnb:
- The city passed a bill in June 2017 that requires all short term rentals obtain a “Special Use” permit. No one knows how difficult or how long that process will take. Click here to see the bill and sections that we have highlighted.
- We cannot prevent some random visitor from causing extensive harm to your property or furnishings. Even though there are some precautions provided by Airbnb, you could get a visitor who doesn’t respect property. Airbnb offers insurance to damages but we don’t have any history as to how good they perform.
- Occupancy varies tremendously depending on the season and the price. Just like normal rentals, if you want a ridiculous price for your property, we won’t be able to meet your expectations.
- It will take some time to “dial in” your property in terms of price and processes. Every property has it’s kinks and it will take time to determine the optimal price for your property. We are getting more data daily.
Legally qualified Airbnbs must meet 3 Location Requirements.
1 – City Of Las Vegas – Must be in the townships of North Las Vegas, Henderson or Las Vegas. There is a large section of Las Vegas that is actually Clark County and not in the township of Las Vegas. Homes in an unincorporated area are being searched by the Casino Mafia. They are actively looking for Airbnb operations and working with the government to shut them down. They don’t want you messing with their casinos.
2 – Not in an HOA – 95% of the HOAs out there have a rule that prevents stays for less than 30 days. Some HOAs are more stringent than others. It’s a good idea to check the rules before you spend a bunch of money doing this.
3 – Away from other Airbnbs – You have to be 660 feet away from another Airbnb. That’s pretty easy to find by searching Airbnbs on the map.
We can still manage your illegal Airbnb but we are not liable if you are shut down by an HOA or the local government. If for any reason, some government entity or local association prevents you from operating and Airbnb location, we will not be held accountable.
The property needs 4 conditions met before we start advertising:
- The property must have carbon monoxide detectors.
- The property must have at least 2 fire extinguishers.
- Limestone Investments must be “additionally insured” by your insurance company (this doesn’t cost you anything).
- The property must be properly furnished. This spreadsheet has basic requirements. The more features, the more money. If you want to furnish your own property, go for it. We charge $1000 set up the basic furnishings and will provide you an estimate up front. There is a lot to furnishing a property.
We charge 8% of the gross amount collected AND $500 to start up.
- All these fees need to be paid up front:
- Start up fee $500.
- Furnishing fee will be $1000. The cost to modestly furnish a 3 bed 2 bath is about $7k.
- We will get photos & video of the property.
- The Airbnb add will be created and you will have an opportunity to approve the add. You will be the co-host and we will be the host.
- We will settle your account near the end of each month. That settlement statement will include a report that has your income and expenses.
Here is the latest information on Airbnb’s. (9/28/2017)
There is nothing in the news to this so you will have to trust my interpretation of the Las Vegas City workshop last week that covered Airbnb applications for Special Use Permits (aka SUPs). These are now required in addition to the Business License. This workshop occurred days after 11 applicants were reviewed and 10 applicants rejected by the City Council. My overall impression was that the planning department was really on the side of the applicants. It was really good to see that the planning department did their homework and had actually recommended 7 of the 11 applicants. The people at planning were literally scratching their heads as to how all that went down. I even smelled a little contempt of City Council. Here are my conclusions.
The planning department actually had some really awesome tips to increase our chances of getting a license and a SUP.
- Show up. If you want us to do this, we will take a nap and bring a sleeping bag.
- Be the first. This means we can kill off someone who already has a license but not the SUP.
- Get Approval from the HOA. If you are in a “Loose HOA”, we must be absolutely certain we have them bless the submission.
- Get everyone on board. We need to get all the neighbors on board before posting the SUP notice. Booze. Trips to Disneyland… who knows. What we don’t want is the pissed off neighbor showing up at 2am complaining about your AirBnb.
Bottom line? It still appears more lucrative than standard rentals even if you get shut down later.
- Pay more.
- Be patient.
- There are no guarantees.