Airbnb Rental Agreement: Pros and Cons

An Airbnb rental agreement is a legal contract between you and your guests, which sits outside of the Airbnb platform, giving you additional legal protection in any guest malpractice event.

But what should you put in the rental agreement? How do you send it to your guests? And what are the downsides?

Let's find out, shall we?

What to Put in Your Rental Agreement?

The information you put in your rental agreement is going to vary from host to host, but there are some basic points that you'll more than likely want to cover:

• Names: For any contract to be legally binding and effective, you must make sure that both parties' full names engaging in the contract are present.
• Location: Address must be included.
• Booking details: The contract should outline the booking details: booking duration, dates, number of guests, check-in & check-out times, etc.
• Fees: Outline the booking cost and any associated fees, e.g., cleaning and maintenance.
• Parking: Add parking rules and instructions.
• House rules: This is where you want to get specific about the conduct you expect from your guests during their stay, e.g., no parties, no pets, no loud noise after 10 pm, etc.
• Host responsibilities: Outline the responsibilities and conduct you as a host will adhere to and uphold, e.g., what amenities you'll provide, your commitment to responding to any problems, etc.

This list is by no means exhaustive, but it's a good place to start when creating this important document. But to make your rental agreement legally binding, it's essential to seek the advice of an attorney. Get your agreement checked off by an expert to ensure it stands up to scrutiny in your jurisdiction.

How to Send a Rental Agreement to Your Guests

Airbnb stipulates that you must make your guests aware of your rental agreement BEFORE they make their booking. Failure to do this will render them null and void.

This means that you'll have to provide access to the rental agreement within your listing description.

Once you've covered that and your guests are aware of the agreement they are entering into, you'll need to send this to them once they've booked. Airbnb requires you to include the full terms of your rental agreement in your message thread with the guest.

Then comes the hard part. Getting your guests to sign the contract and send it back to you!

Once that's done, the process is complete.

As you can see, although Airbnb allows you to ask your guests to sign a contract before staying at your rental, their website has no specific place to attach this document for guest review, let alone sign and return it.

However, using a property management system with the official Airbnb integration like Hospitable dramatically simplifies getting guests to sign a rental agreement. It can save you a lot of time with automation.

Hospitable has the Rental Agreements functionality, enabling hosts to create rental agreement templates and automatically send them to guests for signature. Moreover, this functionality also works for extra services like equipment rentals that you can offer your guests to enhance their stay and increase your Airbnb revenue.

With Hospitable, you can create a new rental agreement template or customize the existing one, including essential details to suit the needs of your vacation rental property. Then, our system will automatically generate a rental agreement for each new reservation, populating the template with guest and booking data.

Your guests will see their agreements in their guest portals as the registration task they must complete to finalize their booking. They can sign their contracts digitally, either by selecting a signature font or manually drawing a signature using their mouse, touchpad, or touchscreen.

If the guest does not sign the rental agreement, we'll automatically send them a reminder two days after the booking. You'll also be able to download all signed agreements in PDF format for your records.

The Downsides of Airbnb Contracts

An Airbnb rental agreement can help you clearly outline your policies and guidelines on guest behavior as well as your responsibilities and ensure a smooth rental experience for you and your guests.

Yet, adding a rental agreement to your booking flow on Airbnb doesn't come without its pitfalls and downsides, which are well worth considering before you choose to proceed further.

Friction

Adding a rental agreement that your guests must sign and return to you adds some friction to the booking process. And, any additional friction may ultimately reduce your booking rate—which is worth thinking about.

How much friction will it add, and how many potential bookings will you lose because of it?

Who knows, but this is certainly worth weighing up.

Airbnb doesn't have your back

This rental contract is between you and your guests and has nothing to do with the Airbnb company whatsoever. Airbnb clearly states they can't help enforce special policies in your contract.

Therefore, you won't be getting any help from them as an intermediary in the case of any disputes.

Instead, any disputes must go through the regular legal process, often involving lawyers and courts, which can get expensive.

Workload

If you're a busy host (which I hope you are), then building a new contract for every new booking can be a bit of a headache if you do everything manually.

On top of that, there'll be many chasing guests for signed contracts along the way. But it's no problem if you opt for Hospitable, which allows you to automatically templatize agreements and send them to your guests for signature.

Hospitable will also help you save time by automating 90% of daily hosting tasks and putting your Airbnb business on autopilot.

Put off your guests

Nobody likes being told what to do, right? And guests are not obliged to sign anything.

So make sure your rental agreement doesn't read like a textbook of rule after rule of what your guests can't do because then you'll lose bookings to your competitors.

Airbnb Rental Agreement: What Are the Benefits?

Ok, so we've looked at the downsides of Airbnb contracts; now, what about the benefits?

Long-term tenants

Did you know that after a certain period, your guest rights change from short-stay tenant to long-term tenant—with all the rights that come with it?

Well, it's true. Depending on your jurisdiction, this switch can happen in as little as 30 days!

That's where an Airbnb long-term rental agreement can come in handy. Otherwise, you could find yourself with tenants in your property that you can't get rid of. Learn more about Airbnb squatters in our dedicated article.

Peace of mind

That's right; you get to sleep at night knowing you're protected from any foul play from guests when renting your home to strangers. The rental agreement also sets guidelines for guest behavior, leading to fewer misunderstandings and reducing the risk of disputes.

Damage control

When damages happen—which doesn't mean that they inevitably will—you'll have legal recourse to recoup the costs of these damages.

Sure, you get covered (to an extent) by the Host Damage Protection as a part of Airbnb's AirCover for Hosts, but having your rental agreement in place is far more solid and robust.

Tenant screening

A rental agreement will likely act as a screening process, helping you avoid troublesome guests before they even book. If potential guests are not going to obey your rules about noise or plan to invite extra guests, they're unlikely to sign the contract.

What About Other Platforms?

Like Airbnb, it's possible to add additional rental agreements on Vrbo. In fact, with Vrbo, they even let you upload the rental agreement to their system, which is pretty neat.

All the same rules and recommendations apply, so what works for your Airbnb rental contract will work for Vrbo, as well—you might just need to adjust a few bits here or there to make it fit for each platform.

Remember that Hospitable's Rental Agreement functionality is available for all our users and works on different booking channels, including Airbnb, Vrbo, Booking.com, Agoda, and your direct booking website.

Conclusion

Adding an Airbnb lease agreement to your booking flow adds a little extra friction to the process, which is something to bear in mind.

And it's also worth remembering that the rental agreement is between you and your guest. NOT with Airbnb as an intermediary. Any problems/claims must be reconciled between the two of you amicably or in a courtroom.

But as with many things in life, the threat of legal action alone is often enough of a deterrent to make people compliant, which is what you really want, right?

A well-defined Airbnb rental agreement can help ensure that you and your guests are on the same page, preventing miscommunication and conflicts and protecting both parties.

Providing a formal agreement also creates a sense of professionalism and helps build trust.

So, should you add a short-term rental agreement to your Airbnb?

That's for you to decide.