Significance of an Airbnb Contract
To safeguard your rights as a host and establish clear expectations between you and your guests, an Airbnb contract is necessary. It can also help prevent disputes and promote smooth operations.
Here are just a few reasons an Airbnb contract is a good idea for you and your guests:
- Protecting the Rights of Both Parties: This is particularly important for host protection rights. The Airbnb platform does not guarantee that a host will actually be paid, and payment may fail on the third-party payment link. Alternatively, it can take many days for Airbnb to process the payment, and since it requires a swipe of the credit card, the payment may not go through if the funds are not available at the time the payment is initiated. A legitimate contract protects both the host and the guest.
- Preventing Disputes: With a contract , the expectations for the rental agreement are clear. This protects both you and the guest should any issues arise. Many Airbnb disputes arise because there are no written guidelines for how various situations should be handled.
- Preventing Problems with People Using the Property for Illegal Purposes: An Airbnb contract can be written to prevent guests from bringing drugs onto the property or using it for the purpose of any illegal or immoral activity. It can also outlaw parties or other raucous behavior.
- Limiting Liability: Although most rental agreements have some sort of limitation of liability clause, the Airbnb contract can be invaluable for limiting your liability if damage or injury occurs during a stay. If your contract is drafted properly, it will greatly limit your liability.
- Work with an Experienced Attorney: It is critically important to have a contract that is drafted on your behalf by an experienced attorney. With the ever-evolving laws in this area, you cannot rely on legal advice from an internet search.
Common Clauses Found in a Sample Airbnb Contract
The following are some of the most important clauses and features of a typical Airbnb contract:
A. Payment terms. In this section, the host and the guest agree to a rental payment schedule, including all applicable security deposits, fees and taxes. The rental price should be clearly spelled out, be easily understandable, and in the local currency. Credit card information will need to be provided in this section. Online payment is usually preferred and often is the only option.
B. Cancellation. Just as important as the payment structure, the contract will detail how a cancellation made by either party will affect how much in refund or penalty will be incurred. As with any contract, the closer cancellation is to the date of the rental, the more severe the penalty.
C. Check-in and check-out schedule. This is the amount of time that the guest will have access to the rental. The times checked will dictate the scheduling restrictions on the guest and it will allow the owner adequate time to prepare the property for the next guest, if there is one.
D. Indemnification. In this part of the contract, both parties will agree to hold each other harmless from any losses, costs and damages that arise from third-party lawsuits.
How to Personalize Your Airbnb Contract
Certain sections of your lease agreement should be customized to suit your needs. You may want to check your local laws and rules to be sure nothing important is overlooked. Once you have checked to see if your local laws require any specific information that you will need to add, you can cut and replace portions of the general contract template with your own information. Consider the following when customizing your contract:
The utilities you are responsible for. As noted in the "Utilities" section of the standard contract, a host is required to cover some utilities. You may wish to add any additional information about other utilities or services you choose to offer renters, such as cable and Internet. Does your house have an elevator? Specify which party would be responsible in the event a guest gets stuck inside it.
Special house rules. Your Airbnb will likely have house rules in addition to your general house rules policy. For example, you might prohibit guests from smoking or having parties. Include anything in the contract you feel is important, especially for families with children, such as not being allowed to bring toys to the pool.
Pets. Is your house pet-friendly? If you have pets, what are their names and what restrictions do you have? Do you require cleaning fees for pets or do you allow animals of any kind free of charge? Include any additional information about pets in your home, even if you think it’s unimportant. This can help prevent issues down the road.
Insurance. You likely don’t need to explain insurance details because they probably aren’t your responsibility. However, it is helpful information to include for both parties’ sake. An example would be if you require additional insurance to cover your items or injuries caused by a guest or that covers signed-in guests’ belongings.
Anything else you think is important. It can be hard to predict how someone would try to get around "house rules," so consider anything you think might need additional detail. There is never such a thing as too much information if it helps keep your guests and belongings safe.
Legal Aspects to Consider When Hosting on Airbnb
For Airbnb hosts, one of the most important legal considerations is whether or not they live in a jurisdiction where zoning laws allow short-term rentals. In many cities around the U.S, short-term rentals are illegal. If someone violates those laws by operating an Airbnb, even innocently (perhaps because they did not realize Airbnb was illegal), they may be subject to fines and liabilities. Anyone renting out a property on Airbnb should check the local regulations to make sure they are complying.
Liabilities are also an issue because short-term rentals are usually considered a commercial activity, and they can expose hosts to significant tort liability. For example, if someone finds out someone has a Airbnb-listed house in their neighborhood, they may show up at the door to demand money if there was a party that night, or to demand that the noise not happen again. This can result in physical altercations that leave hosts with significant injuries.
The forum selection clause , data privacy section, choice of law provision, waiver of jury trial, and limitation on liability sections of the agreement pose some concern also because they have the potential to harm Airbnb hosts. For example, if a host stops following the policy under Airbnb, the company has the right to (emphasis added) exclude them from future listings on its site. That would make it more difficult for them to make money renting out their property.
It is also not possible to post privacy terms that inform consumers about how exactly the data is being collected and shared – so the sharing of such information is often not open, and may be very much outside the host’s control.
The levels of protection offered by the terms of service also differ from jurisdiction to jurisdiction and are not settled as a matter of contract law.
Airbnb Contract Template and Samples
For those who may be interested in reviewing a sample template of an Airbnb type rental agreement, there are several resources on the internet. The Airbnb website has a sample Airbnb host contract, as does the site "LEAVV." A New Zealand website "Airbnb Hosts in New Zealand: A Guide to your Contractual Rights and Obligations" provides some sample clauses for Airbnb contracts and other home sharing agreements and states that they do not provide the complete or entire contract language. A short-term rental hospitality website has sample Airbnb agreements and lease agreements while the site AirbnbFTW also provides some examples of Airbnb rental agreements. Finally, the site Jawad Ahmadikhaan includes a few short term rental contract (lease) agreements that can be useful.
Airbnb Sample Rental Agreement: https://www.airbnb.com/terms/host_terms
LEAVV Sample Short Term Rental Agreement provided by website: https://leavv.co/en/faq-english/airbnb-agreement-template-english
Airbnb Hosts in New Zealand: https://www.lawbox.co.nz/payers/am-i-an-airbnb-host-in-new-zealand
AirbtRent Sample Airbnb Rental Agreement: https://www.airbtrent.com/airbnb-simple-rental-agreement
AirbnbFTW Sample Rental Agreements: http://www.airbnbftw.com/airbnb-sample-rental-agreement
Jawad Ahmadikhaan Sample Short Term Rental Contract: https://jawadahmadikhaan.com/sample-lease-agreement-for-airbnb-renters-what-to-look-for-in-this-rental-agreement
FAQs Regarding Airbnbs Contracts
Do I need a contract for my Airbnb rental?
While Airbnb provides its own Terms of Service that govern the relationship between Airbnb and your guest, those Terms do not protect your relationship with your guest. You are offering the guest to rent real property in exchange for money, and should therefore create your own legally enforceable contract.
What should I include in my contract?
We recommend the following standard provisions:
- Description of the property. Describe the property, including amenities (e.g., internet, pool, spa, etc.), and confirm that it is an exclusive rental (i.e., no other parties can share the property).
- Check-in and check-out procedures, including cleaning guidelines. Outline the check-in/check-out process and state what should be expected upon arrival and departure (i.e., any check-out procedures). In addition, if your rental property has a pool or hot tub/Spa, describe in detail any safety precautions the guests should be taking.
- Rent/Refund Policy. Describe the rent amount, how and when it is due, and whether it is fully refundable. You may also want to state any amount you will be keeping as a non-refundable deposit.
- Security Deposit. If you are taking a security deposit, you should describe the amount, when you will return it, and any deductions you may take from it. You should also confirm that you will not charge the guest damages unless they exceed the amount of the deposit.
- Cancellation Policy. It is best to specify whether you have a full refund policy, or if you will be deducting certain amounts should they cancel at a certain time (e.g., 50% refund if canceled 30 days in advance of arrival date).
- Quiet Time and Parties. Even if you are advertising a party house rental, we recommend limiting parties to a certain time (e.g., 9PM to 8AM) to limit the potential for disturbing other guests or neighbors.
- Liability Waiver. You should be aware that if the property is unfit for occupancy, or if there is a failure to provide the guests with essential items that they rely on (i.e., the pool is broken, there’s no hot water, etc.), you could be held liable. Therefore, we recommend that you have a waiver stating that you are not held liable for any act of third parties, property defects, weather conditions, natural disasters, etc., which you could not reasonably control (note that we are not attorneys, and this is not intended as legal advice).
- Consent to Share Information. While it may not be necessary or commonly used by other hosts , you may want to consider requiring your guests to consent to sharing their information with any other property owner you may have. This will help enable you to ensure the safety of other property owners or tenants in the event that a guest causes any problems. (e.g., Johnny comes home at 3AM, out of control, and tearing up the property, and it is unclear whether he comes from your property or the neighbors’. But if you have his information, you can reach out to him immediately to stop the damage).
- Hold Harmless. We recommend stating that the guest agrees to indemnify and hold the host harmless from any losses, damages, and expenses (including legal fees and costs) arising out of the use of the property. In addition, it may be wise to state that the host is not responsible for any accidents that occur on the property (see more on this below).
- Permission to use photos and reviews. Often, people book Airbnbs simply based on their look. As such, it may be beneficial to allow yourself to use the photos you take of the property (i.e., if you decide to stop renting out the space, you can still use the images you take). In addition, if you are using Airbnb reviews, you will want to be able to use the reviews and testimonials from your guests.
Should I allow smoking/pets?
We recommend that you have a pet and/or smoking policy that outlines when/if pets/smoking is allowed. In addition, you may want to include a statement that states that any smoke must meet a certain safety requirement (i.e., the smoke cannot be traceable to the property).
Can I be liable if my guest throws a party?
While this may not be an issue as much as it was a few years ago (given most people’s access to Ring doorbells and other home cameras), you may want to have a clause in the agreement that states that any violation of any laws (i.e., excessive noise, illegal activity, or use by a person not listed in the agreement), will be a material breach of the agreement, and could result in immediate termination of the rental at the expense of the guest.
How Can I Protect Myself From Damage to The Property?
We typically recommend having addendums containing the guest’s release and waiver of liability and Hold Harmless agreements, so that you can assert them against the guest and possibly share liability with Airbnb, given their Terms and Conditions. In addition, you may want to consider getting more comprehensive short-term rental insurance coverage, such as Proper Insurance, which covers rental income, liability, and damage/loss to the property.