Since launching in Australia in 2012, Airbnb has taken our nation by storm. For home owners who are just looking to make a quick buck while they’re out of town for the week, Airbnb is a super flexible and easy-going option. For your investment property however, you might run into some trouble if your tenant takes the freedom to list your rental on the site.

Let’s look at why subletting and Airbnbs are a source of problems, and how you can avoid it.

Let’s say your tenant is going away for a couple of days around New Years. They lease out the property to some random person who hosts a huge party.

Someone gets drunk, slips and is hurt. You get sued, and landlord insurance doesn’t cover it.

When people are just staying for a weekend or a couple of days, they have little incentive to take good care of the property and treat it with respect.

Uni students like to rent out cheap Airbnbs for parties and even adult movie shoots! Do a quick Google search for “trashed Airbnb''. The results are horrifying.

In 2016 a St Kilda property owner ran into trouble when they were legally unable to evict tenants who were renting out their apartment on Airbnb. There was a sublet clause in their lease, but it did not cover Airbnb rentals and Airbnb property management so the landlord’s hands were tied. As the Airbnb visitors weren’t given “exclusive possession” of the property, they didn’t count as illegal Airbnb subletting. 

Don’t let these horror stories scare you, there are steps you can take to protect yourself against Airbnb subletting at your investment property. These include:

• Take a look at your current lease agreement. Has your property manager included a special condition banning short-term rentals (over and above a general ban on subletting)? If not, you could be left exposed.
• Conduct regular inspections at your property to check your tenants haven’t set up an Airbnb or other subletting arrangement without letting you know.
• Whenever you have new tenants move in, go over the lease agreement with them in person if you can, or ask your property manager to. This way you can double check that they’re aware of the terms and neither of you will run into any surprises down the track.

Don’t leave yourself exposed to Airbnb subletting and damage liability - have a chat to your property manager about how they’re protecting you and whether there are any changes that could be made to your lease agreement.

Airbnb might be great for a weekend away, but not in your investment property.

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