Could Airbnb guests be more trouble than they are worth?
Letting out your home for a week or two using sites like Airbnb, can seem like a tempting way to boost your income. Especially as Bristol is such a popular city for tourists.
And it would appear the Government totally approves - this March, the chancellor announced that the first £1,000 of income earned in this way will be tax free from April 2017.
But could you be landing yourself in hot water with your mortgage lender?
The popularity of sites like Airbnb, which enable you to offer paying guests temporary accommodation in your home for short periods, has risen sharply in recent years
But if you don't have consent from your mortgage lender to temporarily rent out your home, you are highly likely to find yourself in breach of your home loan contract.
But even when you do seek approval for a short-term let - for example, when you are going on holiday for a week - many lenders, including the Co-op, Clydesdale Bank, Yorkshire Bank, the Bank of Ireland, the Post Office, RBS and Virgin Money, will still turn you down anyway.
What could happen if you go ahead without consent?
Tempting though it is to carry on anyway - after all, is your mortgage lender really likely to check up on you? - it could end in tears.
In some cases, you might be hit with a fee or face a higher mortgage rate. In others, the consequences could be more severe, the potential risk of a demand for the immediate repayment of the whole mortgage or even, in theory at least, being threatened with repossession.
There is also a possibility that your buildings and home contents insurance could be invalidated if insurers are not told in advance about any paying guests.
What if you only want to rent out a room?
Once again, the Government has made this a more attractive proposition.
An increase in the rent-a-room allowance (allowing you to rent a room in your home to a lodger) from £4,250 to £7,500 has just taken effect and means the tax free sum you can earn from renting is set to rise.
And although renting out your entire property on Airbnb might appear more appealing, and lucrative, doing it on smaller scale could be less problematic.
According to a survey by the Guardian newspaper, some mortgage lenders will consider allowing rooms to be rented out on sites like Airbnb, usually for a fee and provided the home insurer has been informed but it is still important to tread carefully.
The way forward…
The courts are now starting to see cases involving Airbnb and breaches of lease and tenancy. And some lawyers believe this will inevitably grow.
So, to be on the safe side:
- Check your home loan contracts and tenancy agreements carefully
- Contact your home insurer for clarification
- An actor who used Airbnb to let the spare room in his central London apartment, usually just for a day or two at a time, was evicted after his landlord, a charity, discovered he had been subletting.
- The lessee of a penthouse in London was found to be in breach of his lease, after subletting rooms on various sites including Airbnb, by allowing the property to be used "otherwise than as a private residence for occupation by a single household".