AirBnB Case Pits Landlord Against Tenant

By E-Renter Tenant Screening
Posted on June 8, 2012 under Lease and Rental Agreements, Legal | Be the First to Comment

A Brooklyn landlord obtained a restraining order against a tenant who has been renting out his apartment by the night through Airbnb, the site that connects travelers with homeowners or tenants who have rooms, homes or apartments to rent.

By turning his apartment into a full-time hotel room, the tenant made nearly $20,000 in nine months. He regularly grossed $1,000 per month over the cost of his rent by inviting unscreened, unapproved guests from all over the world to stay in his apartment.

Not any more. The landlord was well within his rights to use the court system to stop the tenant from endangering his business through running his own business out of the apartment, which is not only an illegitimate use of the rental property, but could lead to all sorts of problems.

Landlord’s insurance would not likely cover incidents that can occur when hundreds of strangers inhabit a property in a given year—while the chance of accidents, thefts, property damage and fire increase. There is simply much greater risk to the insurance company and the landlord when a property is used as a hotel.

Rentals are typically not allowed to be commercial enterprises, such as clothing boutiques, restaurants, bakeries or doggie day cares, so why would a tenant believe it’s okay to make money and put the landlord at risk by running a hotel?

The funny twist to the story is that the landlord has started renting empty units himself on Airbnb.

Landlords, remember to be specific in your leases about which activities are and are not allowed in your rentals. If you do not allow roommates without your approval, or subletting without your approval, you should add that you do not allow tenants to have paying guests by the night, by the week, or at all without your approval. Check with your attorney for proper language to protect your interests.