Looking for opinions on getting started

[Diego1151]

Hello Airbnb community a friend and I have grown interest in hosting an apartment and we kind of get the idea of what to do with the place (i.e we're thinking of subleasing an apartment near a touristic area, what stuff we need to buy and furnish with if need be etc). But what I'm trying to figure out whats the best way to get started? Would it be ok for us to just make an account under our names and pay everything via our personal banks and like a business paypal or would it be better to start an LLC? My friend says just put everything on our names and make a Paypal business account should do it as his cousin does it this way but it is a 1 person business for that cousin. But I'm wondering if there would be other advantages over the latter and have an LLC and a bank account with it. Mostly concerned about taxes and mixing stuff up because its personal and business and its with 2 people so I don't want to mess up anything with the IRS. We're currently working towards obtaining the sufficient funds to make this possible and just wanted to get ideas on how to start this probably by this fall or winter. Thank you for reading this and I look forward to your replies.

[Angelica-Y-Jorge0]

@Diego1151 I would suggest checking out Airbnb Automated. Sean has a playlist for new hosts and talks about LLC's and much more. It really helped me when starting I binge-watched it for hours. 

Here is the link:

https://www.youtube.com/watch?v=91hVcAhjfz0&list=PLjdl1yk0inrX018sTh0IvwxvJsvuqRwFK

Hope it helps

[Diego1151]

Awesome I'll share this with my friend and we'll watch it thanks!

[Sarah977]

@Diego1151  The first thing you have to realize is that very few homeowners and landlords will allow you to sublease on Airbnb. This kind of subleasing is almost always against the terms of your rental lease. 

[Dale711]

Hi @Diego1151 

Welcome to the community 😊

I am sorry to tell you that private homes subleasing with or without landlord approval is not a bright business.

Do research furthermore before you inaugurate it. 

[Robin4]

@Diego1151 

Diego, the short term sub-letting of a rental property will be your main stumbling block so, before you start to make too many plans make sure of where you stand on this issue.

The reason Landlords and HOA committees do not allow STR is, by doing so you void the property's insurance cover! You void the insurance cover not just on the apartment you are renting, you void the cover for the entire property. You have altered the risk the insurer accepted when they offered a policy.

It's like taking out private comprehensive auto insurance and then using the auto as a taxi......your cover will be cancelled, as many Uber drivers have discovered!

There are insurers who offer property cover for STR but they are considerably more expensive and property owners do not routinely use them because of that cost factor.

If you do wish to pursue this, check thoroughly the rental contract before you sign. I am sure there will be a clause in there that prohibits sub-letting!

Sorry, I don't want to be a prophet of doom but I cannot tell you how many times we have seen this issue over the years.

Cheers........Rob

[Lorna170]

@Diego1151   Robin has a good point about the insurance -- even if you are able to sub-let the apartment or house, because you are not the owner of the property you may not be able to obtain the correct (not regular homeowner) insurance.  However, if your landlord will allow you to sub-lease, you should offer to pay the difference between regular rental property insurance and short term rental property insurance.