Rental lease agreement for AirBNB is that common?

Question

My family is going on vacation this summer and rented through AirBNB. We are staying six days. After booking, the owner sent us a 5 page lease agreement for their property. Probably a more detailed lease than half the landlords out there use for their full time rentals. I have used short term rental services some in the past, but never had someone send me a lease. It honestly made me mad. The place is over $250 a night, 50% cancellation, so it already pretty pro-owner. It is making me rethink STR. I can stay at a hotel and cancel up to 24 hours in advance without signing a contract.

Anyone operating STR use leases? Is that common? Anything I should be worried about?

Valerie Rogers · Answer

I'm in agreement with @Lucas Carl 's point that having a guest sign a rental agreement is common and normal in this industry. It might not be so much so on Airbnb because that site started out as a "home sharing" community. But VRBO/Homeaway owners traditionally offered whole homes for rent as opposed to a room in a house so those are the owners who commonly require guests to sign a rental agreement.

I don't consider myself "old" just because my bookings primarily come through VRBO or because I require a rental agreement, though.  LOL

I advertise on VRBO/Homeaway, Airbnb, TripAdvisor and my own website and I require EVERY renter to sign a rental agreement for their reservations. It so happens that my rental agreement for an Airbnb booking is actually 7 pages long.  However, I've never had anyone question the contents or refuse to sign it.

On all of my listings I clearly state that the guest must be willing to sign a copy of our rental agreement & provide a copy of their current ID. I link a copy of the rental agreement to every listing, or in the case of Airbnb the entire contents of the rental agreement are included in the "House Rules" section. So guests can review it before they send an inquiry or a booking; no "after the fact" surprises.

On Airbnb the host has to choose one of their cancellation policies; this host has chosen the "Strict" policy, which is what I have chosen for my properties (50% refund up to 1 week prior to arrival, except fees). This cancellation policy is actually more lenient than my own and the same may be true for the owner of the property you have rented.

Look at it from the host's perspective: they are the ones who have invested their $$ into the purchase, furnishings, improvements and operational expenses for the property and are allowing total strangers to use the property for their vacations. Just because you pay rent does not mean the owner should not care about what happens at the property during your visit.

When a guest books a vacation at the property the host takes it off the market for other potential guests and saves those dates for that guest. If you should happen to cancel 8 days before your check-in date the host has to refund 50% of the payment back to you, even though they may not be able to re-rent those dates to someone else at such a short notice. The host has lost 50% of the rent that he could have earned if he hadn't have been saving those dates for you. (This is especially true for locations that require a flight to get to, such as Hawaii or the Caribbean for example. Those locations are more difficult to secure a last minute booking since most tourists have to buy an airline ticket to get there.)

I always recommend to my guests that they consider travel protection insurance which can reimburse them for the funds they do not recover if they are forced to cancel their vacation (as long as the reason for the cancellation is a "covered event"). As for the situation of the host canceling the guests' booking, that is so rare and especially if it was booked through a site like Airbnb or VRBO/Homeaway, since those sites seriously penalize a host who cancels a guest's reservation.

If you were not made aware of the terms of the agreement before you booked and now object to some of them I think if you contact Airbnb they can help you in this situation. If I was the host I would rather agree to a full refund for the guest now to cancel the booking than to have a guest who is disgruntled before ever arriving at the property.

James Carlson · Answer

"Did you get an old vibe?"

Best line of the BP forums today. Thanks, @Lucas Carl

Wendy Schultz · Answer

It is possible that the municipality requires a rental agreement. One of the municipalities we have a rental in does. We made one up that basically says to behave and no one gets hurt. ;) He may have looked on the internet for a sample agreement and that's what he uses as his lease agreement and that's why it's 5 pages long. Take a look through it and see if there is anything that you object to as someone stated above. As long as you behave, there won't be an issue.

Tyler Work · Answer

@Joe Splitrock the owner probably got burned by a previous guest and felt compelled to try and protect themselves with a lengthy agreement.  Signing a rental agreement shouldn't have anything to do with the price you pay for the unit.  Hotels offer 24 hour cancellation because they have tons of rooms and don't rely on one of the units for all of their revenue.

If you don't feel comfortable signing it, I wouldn't sign it.  However, I don't think its that uncommon, and in fact it actually shows you are staying with a savvy host who likely knows what they're doing.  I could see it as a good thing.

Luke Carl · Answer

@Joe Splitrock  There's a pretty good chance they don't even know what the rental agreement says they probably just googled "airbnb rental agreement" and downloaded the first one the saw. I'm not saying this because it's been a while since I've read mine and it may have popped in my head that I don't know what mine says because that is of course not true ;)

My guess is if you call 855-4-airbnb you can probably get out of it full refund because you don't like the RA. Unless their listing says "all guests must sign and return the rental agreement" at which point you would be bound to the cancelation policy.

I bet you'll have a great experience and I hope you leave them a fantastic review.

Keep us posted.

Joe Splitrock · Answer

My point about the high rate is that over the course of 6 days, I am paying around $1800 to rent the place. I looked the property up on Zillow and they paid $160K for it two years ago. Good for them, I have no problem with them making money. However, if I am paying $250 per night, my standards and expectations are higher than if I paid $99 per night.

My problem is the rental agreement gives them rights to enter the property at any time and has steep policies around cancellation. There is no protections for me as the renter if they were to cancel. That is what scares me most about short term rentals is nightmare stories I have heard about hosts cancelling and the renter has no recourse. I am sure if I cancelled they would charge me 50% and then rerent it to the next person for 100%, which is why I am saying 50% cancellation is too high.

You are right that it is my choice and ultimately I just signed it, but mostly because I felt I had no choice. I don't see someone with a 5 page agreement negotiating terms. I could back out, but the contract was sent to me after booking. After a week of my wife and I spending hours looking through properties to make a decision. Maybe AirBNB needs to add a "contract required" field and have the host post the agreement up front. That would be full disclosure.

You are right, they seem old. I have just never encountered this before with AirBNB. I guess in the future I will inquire about contracts during the decision process.

Nathan Gesner · Answer

You're probably making too big a deal out of it. If it makes you uncomfortable, just find another rental and move on. Be sure to contact the owner and let them know that you thought it was unreasonable.

Renting an AirBnB is different than a hotel so it's reasonable to have more rules. I used to manage 70 vacation homes and we had a one-page agreement. However, I also had a longer list of rules and instructions on my web site and at each home.

Paul Sandhu · Answer

@Joe Splitrock I would pass on this offer and find another.  There is probably some fine print in there that will cost you some money.

I have 22 STRs and have rented to at least 1200 people.  So that is about 500 times I've rented out a house.  I had a simple lease the first and second time.  The next 498 times it's just a verbal agreement and a handshake.  We agree on a price, the payment day each week, and the last week is prorated for days stayed.  We agree that they take the trash out, they don't park in the front yard, they don't put indoor furniture on the front porch, and they don't let any stray animals inside.

Had no problems with about 488 of the rentals.

The other 10, having a lease wouldn't have made a difference.

John Underwood · Answer

I have an agreement for my VRBO that people electronically sign when they rent my place on Homeway.

I use Airbnb also but it isn't as popular in my area for vacation rentals. I don't think they even have the option of adding this.

I never had anyone object to the agreement but since you are getting it after the fact it is brought more to your attention.

All that being said, I would just read the agreement and see if there is anything that you object to, if not just sign it.

If there is something you don't like ask the owner to compromise on the sticky points.

If you can't both agree then consider cancelling and re-booking with someone with less requirements.

Rental lease agreement for AirBNB is that common?

Most Popular Reply