Quote from @Bill B.:
Get the most insurance you can afford as you won’t be doing any screening of tenants and expect them to stop paying rent and having no recourse if suddenly the rules change. Maybe try to get the owner personally responsible for the rent but likely they’ll be broke and declare bankruptcy if rules change. So that might be worth nothing. Does the unit have any neighbors that might want to break their lease if this becomes a party house?
I guess if you are getting a 50% premium and don’t have any assets so your judgement proof it’s only a bad idea not a horrible idea. I just don’t know your liability limits when a car full of underage drinkers from the party at your unit dies. Just abandon the idea once you have some assets. I don’t know if even an llc would protect you. And make sure you switch your insruance to short term rental so they don’t deny you.
@Bill B. we have tons of assets so that could be an issue but I don’t see how this is any more of a liability than a vacation rental or the hundreds of thousands of properties that are listed with Airbnb, vrbo, Zeus, etc… do you have any other insight into this? We are putting additional provisions into the lease to additionally protect the landlord but that is also why I am here.
It is a townhome and we don’t own the neighboring units so no issues there. On top of additional rent we are requiring additional security deposit and the owner of the company is personally guaranteeing as well.
