[00:00:00] Speaker A: Just like touching back on the rental agreements for a second. I do think there will be exceptions that you, if you really want to keep one, you'll be able to upload it and still do it. Like, for example, I tested it out and I uploaded mine already under one of the exceptions by saying I had an amenity and it accepted it. So, you know. But then the question will be whether Airbnb, if someone didn't sign it, whether they would enforce it and agree with your amenity interpretation or whatever gray area interpretation you have and cancel on the guest if the guest is refusing to sign it for no penalty. So that would be the question.
[00:00:44] Speaker B: Hey, y'. All, welcome back to another episode of the Short Term show. So today, very special episode, because, as you know, Airbnb came out with a rule update last week, and we want to talk about that. We want to keep you updated and talk about what that means for you as a host.
Everybody is enjoying posting about the cleaning stuff, but that's not the stuff that I'm really concerned about. I'm more concerned about the legal and liability implications. So we have a face, familiar face for you guys. She's been on before. Katie Johnson, she is an STR attorney and really excited to have her on today to talk about this. How are you, Katie?
[00:01:21] Speaker A: I'm doing well, Avery. Thanks for having me. So great to be back.
[00:01:25] Speaker B: Yeah. Thanks for coming on.
Okay, so let's start with the basics. Big announcement last week. Everybody on social media is talking about it. What does it actually mean? Let's just kind of go through the changes that are being made. So can you summarize those for us?
[00:01:39] Speaker A: Yeah, absolutely. So I think you touched on the cleaning one. We don't have to hit that because that one, you know, I don't think is as concerning for us hosts. But the ones that I'm real concerned about are the changes to the rules and regulations in terms of, you know, whether you can have a rental agreement. So. So that was one of the changes. One of the changes was that you can no longer use rental agreements unless you fit one of the four categories. They provide.
Huge. We can dive into those four categories and what you might be able to say is an exception, but that, you know, that was one of the big changes. Another big change was the ability to verify guest ID and do background checks. They said you can no longer do that unless you meet a legal exception. And then lastly, the other one I think that a lot of people are concerned about is the WI FI collection, where you use, like, something like Stay Fi or another sort of wi fi service where you're collecting emails from guests when they come. So if you think about all these, they all are going sort of to the same thing, trying to prevent you from getting guest data. So any guest information, guest email addresses, things like that. So it all seems like they're trying to prevent us from building our own business.
That's just like my hot take on it. But bigger issue is the legal implications of not being able to have your rental agreement.
[00:02:56] Speaker B: Yeah. And I just. Before we really dig into it, I want to just take a minute to tell everybody to calm down. Just calm down. Like, this is not the end of short term rentals. The vacation rental industry existed long before Airbnb, before the Internet, and will continue to exist if anything ever happens to Airbnb. So everybody chill out, okay? Just bring it down like six notches. And to be honest with you, I only do one of these things that are now being changed. Like, we do rental agreements, we don't do guest IDs and we don't make them clean, which we're not really talking about today. And we don't do the Stay Fi thing. And I know that's so controversial or among the short term rental influencers because everybody's like, book direct and, you know, build your email list and do that.
The markets that I'm in, they don't really.
The juice isn't worth the squeeze, in my opinion, in a big, big vacation market. Like, people are that come here to my markets every year. They're staying in different places a lot of times, so I'm not bothering with it. And there's so many people coming to the markets that I operate in that I'm not worried about it. So I just want to take a quick minute for everybody to calm down. But first, let's talk about the first. Let's. I want to do rental agreements last. So let's talk about the ID thing, the guest id. I know there are services out there, super hog, which is now truvy. I think that they focus on doing these little mini background checks on your guests, which is good to know. Just because I don't do it doesn't mean you guys shouldn't have been. But it's good to know, you know, who's. Who's coming and who's in your house that you own. So tell me, Katie, what. How are we feeling about this change?
[00:04:37] Speaker A: Yeah, no, Avery, first good points on Calm down. I think that there's going to be, you know, potentially a rollback to Buy Airbnb. And then, you know, also there's a lot of gray area, naturally, that, you know, us lawyers can find in here as well. So. But on the, you know, change for the IDs, I think that there's actually a lot of laws that exist now that if you want to still do this, going to still be able to do this.
So, you know, if you're, you're doing this now and you're in a state like Michigan, for example, there's actually a law that says that we're technically supposed to be collecting this information from guests and holding onto it for three years. It's something that I don't think a lot of hosts are doing or even know about in Michigan. And, you know, it's really geared toward innkeepers, hotels, things like that. But I would argue that it applies here. In fact, an Airbnb rep brought it up.
So I think, you know, in a lot of states, you're going to have something similar to this. You know, Florida has something like that, too.
So, you know, there's these statutes and regulations are, exist. So if some, some sort of crime, for example, happens at your property, then the police know who are there. And so I do think that, like, if you still want to do this, there's going to be a way to do it. There's going to be an exception or, you know, they may end up walking it back a little bit, too.
But, you know, Arizona is another place that has a requirement in a lot of places for you to do background checks to look for sex offenders. Actually, I do think that, you know, you're going to be able to do it, most likely, if you really want to. There's probably some sort of workaround you can find. There are probably going to be some places that don't have it. But, you know, overall, you'll just have to decide for you whether that's worth the risk of continuing to do it. The way it really comes up, too, is in the chargeback situation, which I don't think Airbnb has people as merchant of record. Do you know, Avery?
[00:06:33] Speaker B: I don't know. I don't know that.
[00:06:35] Speaker A: Yeah, I've never had a charge back on Airbnb. I've been hosting there for 11 years, but maybe they do, and I just haven't experienced it because the way the ID can come up is like in the chargeback situation. So that if you had a chargeback, you know, you show them, hey, here's my rental agreement, here's the ID of that person they stayed Here, you know, that would be like how you would defeat a chargeback potentially. I just haven't had to do it. So, you know, overall I, I don't think that, you know, we'll just have to see how it plays out. But I think also if you have a gap, you can always try to get your local community to require it.
So, you know, there's a lot of workarounds for sure.
[00:07:15] Speaker B: Yeah. So let's dive into that really quick. So the house rules. You, you're not really. The house rules are now kind of like a suggestion and the only way they're enforceable is if it's also a community rule for short term rentals. So an example that I'll use is occupancy.
So in the markets that I'm in, there are occupancy rules. It's like two people per bedroom plus two or something. I can't even remember because we, it's not a thing that we really deal with. So our occupancy in our houses is that we're not trying to slam 200 people into a two bedroom. So. So that rule is. Isn't really changing for us. But is that the way it's working now? The house rules have to be supported by community regulations,
[00:08:03] Speaker A: essentially. You know, there's seven house rules that they're allowing.
I'm trying to remember all of them. It's the overnight guest.
No, you know, no commercial photography events, pets, smoking and a couple others. So like they have these like. Pull
[00:08:22] Speaker B: it up.
[00:08:23] Speaker A: Yeah, pull it up, Avery. And, and then if you try to add any. Like for example, I try to add an indemnification clause which if you don't know what an indemnification clause mean is that's just saying your guest is going to hold you harmless. Mean, you know, they're not going to sue you for any act that happens. You know, if they fall or slip on the stairs. Of course you can't have them hold you harmless for if you did something grossly negligent or willfully wrong. But you know, that's what an indemnification clause. I tried to add that in as an extra like request and I actually got an error message saying this is a contract.
You cannot have a contract in your house rule request. So I thought that was.
[00:09:03] Speaker B: That is. Okay, so the seven are maximum overnight guests, quiet hours, events, so you can prohibit parties, pets, smoking.
Okay, so you. The pet policy is still in place. That's important. You can still, if you want, smoking, commercial photography and filming. Heard some very Fun stories about that.
And locking up at checkout, you can require them to lock up and return the key to. That's reasonable. And so things that there's house rules that are guests are required to follow, which are the seven standardized categories. And then there's the host requests, which guests are encouraged to follow and they are additional reasonable instructions for. But enforcement is less certain. So those are the seven.
[00:09:48] Speaker A: Yes, exactly. Yeah. The one I am concerned about from those seven rules would be the overnight guest one, which you kind of touched on, you know, just because even though they have the no events, it's like, well, what turns into. What is a party? Like, if they have 10 extra people over in the day, is that a party?
I think that's where you can lean on your regulations in your local municipality if. Especially if they have rules on sort of your occupancy and what you're allowed to have at the property.
But, you know, that's why I also like the rental agreement, because a lot of times people see that and if they were planning on doing something like that, they're like, oh, this is not the place for me.
[00:10:22] Speaker B: Yeah, yeah. It scares them off of it.
Okay. Oh, okay. So I have another question too, on both ID and additional fees and costs. So they're saying you can't. Oh, no, I remember what it was. So you. You said that a lot of these rules are targeted at keeping you from collecting data on what are essentially Airbnb's customers, which makes sense in the grand scheme of things. Nobody wants their data sold to somebody who's then gonna spam them with a bunch of stuff about their property that these people never wanted to get anyway. Like, I get it. I don't care. Like, if I'm staying at your house, I don't care. Don't send me an email. I don't want you to have my email. But I get it. You know, I get a lot of people have built their direct booking email, I mean, email lists off of this direct booking business. Off of it. But I kind of get it, you know.
But anyway, that was just the main point that I wanted to make. But when it comes back to my ID and additional fees. So you're not allowed to charge any additional fees. Everybody loves to scream about cleaning fees. Guys, that's so such old news. Like, where have you been? That's. Those clean fees have been gone for like two years. Just stop, grow up. Find something else to complain about. But additional things. We do charge additional fees for heating the pool.
And we also have a situation Like a setup where you can rent a golf cart. We don't own the golf cart. The golf cart rental company owns the golf cart. And if you want to add that, then we hook you up, you know, facilitate the rental. But we have to get your ID and it's an additional fee to be paid. Well, it doesn't. The additional fee does not come to us. It goes directly to the golf cart people. But there's. Now there's some confusion. Okay, well, am I allowed to take this ID and take it to the golf cart person? Because they have to have that.
And can I charge an additional fee now for my pool heating? Because that's just going to make the price go up.
So what, what can we do there legally?
[00:12:16] Speaker A: Oh, that's a great question. I think for the golf cart amenity, they listed that out as an exception to their rules. For. Yeah, for example, for like rental agreement piece two of it they called an amenity. And then I think that potentially could also apply for the license, because it makes sense that you would want a license for someone to have a golf cart.
But otherwise, if it's in Florida, too, I believe the. Your statewide statute requires id, so you could lean on that for that piece.
[00:12:48] Speaker B: Okay.
[00:12:49] Speaker A: Is it in Florida or is it in Tennessee?
[00:12:50] Speaker B: It's in Florida, yeah. Not. Not riding golf carts around the Smoky Mountains?
[00:12:54] Speaker A: I didn't think so, but you never know. Do you have properties in Alabama? Are they all. Is it Florida and Tennessee? Mostly
[00:12:59] Speaker B: Florida and Tennessee.
[00:13:00] Speaker A: Okay. Yeah. So Florida then you should be fine. You can still do it under that theory. Or you can. And then you can also still require them to sign a waiver, if you have a waiver for that golf cart, because that was something that they listed as an exception to their role.
[00:13:12] Speaker B: Hmm. Okay. So there's lots of exceptions. This just seems very. So many gray areas and so many specific situations where it would be allowed. I'm interested to see how they're going to enforce this.
[00:13:24] Speaker A: Right. Enforcement would be the second question. Like, how are they really going to enforce any of this, especially the stuff on your property, like, for example, the. Even the statefi stuff. Like, how are they going to enforce that? Like, how are they going to actually know that you're doing that unless the guest complains, which is possible. I don't know. You know, I don't do it either. I don't collect emails at my properties, so I don't know if guests complain about that often. But that's something to consider if you're going to continue to do it despite the new rule, you know, if. You know, if people have complained before or not, for the chances of getting caught, I suppose. And then also in terms of all the amenities and things like that, I mean, there's just so many great areas that I think you could make an argument that you fall into these exceptions if you wanted to continue to use your rental agreement or amenity waiver.
And then I also think that they may end up expanding the exceptions. Like, that's my prediction of what happens is either they roll back some of the rental agreement stuff or they expand it, like, for example, adding an exception for your insurance in there. Because right now there's only four exceptions, 28 day plus days, you know, if HOA requires it, or building security, legal requirements, or an amenity like we talked about.
[00:14:41] Speaker B: Gotcha.
Okay, so let's move on to the rental agreement. So this is the one that's making everybody pretty mad, and rightfully so, because they're saying you can't have a separate rental agreement that protects your property from guests misbehaving, doing things that were against the rules that might damage your property.
So let's talk about this first before we get into the true rental agreement thing. Like, what. What do you think about this just from a property owner rights standpoint? You know, at the end of the day, this is my damn house. You know what I mean? Like,
[00:15:15] Speaker A: that's right.
[00:15:16] Speaker B: They're,
[00:15:17] Speaker A: like, trying to property manage us.
No, I mean, it's awful. You know, I've had people ask me, can we sue them? Can we, you know, do a class action? Like,
[00:15:25] Speaker B: oh, please.
People that. That ask that question.
Totally. Like, those are the people that do chargebacks at, like, Target. You know, these people are not serious people. They're like, let's do a class action. Please.
[00:15:43] Speaker A: We all just. Just so we can answer that real quick, we all signed. When we sign up for Airbnb, we waive our right to ever do a class action against them.
[00:15:51] Speaker B: Oh,
[00:15:52] Speaker A: it's in the tos.
They got ahead
[00:15:55] Speaker B: of it.
[00:15:55] Speaker A: Yeah. So just keep that in mind. But in terms of property rights, I. I understand what people are saying, but on the other hand, it's a voluntary platform, so we don't have to be on it. So if you have an issue with it, you can leave. I mean, it's not great, but that would be the sort of response for that.
[00:16:13] Speaker B: Yeah. Okay, so we signed up for it. We're not being forced. We can leave if we want to. So the whole property owner rights is kind of out the window. If you want to be here, you got to play by the rules.
[00:16:22] Speaker A: That's right.
[00:16:23] Speaker B: Kind of sucks, but I get it.
Okay, let's talk about, then, insurance and liability. Because the whole reason people have these rental agreements is so people don't do stupid shit in their houses and kill themselves, hurt themselves, or tear the property up. So if we don't have this in our rental agreement saying, hey, here's the terms of being allowed to stay in my house, if you do dumb things and you kill yourself, then I'm not liable for that. Or if you're, you know, doing something like jumping off the balcony into the swimming pool and miss, you're not going to sue me, things like that. So that's the
[00:17:00] Speaker A: kind
[00:17:00] Speaker B: of stuff I worry about more so than, you know, people breaking a tv.
[00:17:04] Speaker A: Oh, no, for sure.
Yeah. I mean, I do think, just like, touching back on the rental agreements for a second, I do think there will be exceptions that you. If you really want to keep one, you'll be able to upload it and still do it. Like, for example, I tested it out and I uploaded mine already under one of the exceptions by saying I had an amenity and it accepted it. So, you know. But then the question will be whether Airbnb, if someone didn't sign it, whether they would enforce it and agree with your amenity interpretation or whatever gray area interpretation you have and cancel on the guest if the guest is refusing to sign it for no penalty. So that would be the question. But I like rental agreements. It sounds like you do, too, Avery, for just, like, preventing bad people from staying at my properties. Like, you know, they see it and they're like, oh, no, that's not the place for me. Like, I planned on having a kegger here. And, you know, I'm not signing that rental agreement. So I like it for, like, that deterrent effect
[00:18:01] Speaker B: more
[00:18:02] Speaker A: than anything. Same with, like, fines, which are now being too, like, you know, saying there's like, $1,000 smoking fine. Love that. For, like, just trying to get people not to do it. Not that. Not that I'm necessarily going to give anyone that fine, but just, like, that deterrent defect.
So, you know, it'll be interesting to see how that plays out in terms of whether people stop using. Have to stop using them, but if they do have to stop using them, the insurance piece, your llc and your safety, you know, you have to go back to those other three pillars. I always talk about four pillars to mitigate your liability.
So to the insurance piece, I think, you know, right now is the time to Go look at your insurance, make sure you're covered for that event that you're describing there. Someone jumping off your roof, missing the pool, becoming seriously injured or dying, you know, so just making sure that you're covered and you're following all your insurance requirements.
[00:18:53] Speaker B: Yeah. I'm going to do an episode on checking your insurance because hurricane, I can't pronounce it, Hurricane Acai that we had down here in Destin a couple weeks ago.
My builders risk insurance on a new build that I'm doing that is several million dollars emailed to cancel me the day like two days before. As soon as it was named in the Gulf. They're like, hey, you're canceled. Nobody would speak to me. I couldn't even find out why nobody would respond. I went on LinkedIn and CC like CEOs and CFOs and everybody. I'm like, what is this? Why, why am I canceled? Nobody. The only response I could get was we'll talk to you after the storm. So luckily.
[00:19:34] Speaker A: Wow.
[00:19:34] Speaker B: Yeah, we didn't have it, but anyway, we'd have any damage, but I was like hot. So I'm going to do one on that anyway. But back to the, the insurance thing.
Do, I mean, do you think that Airbnb is going to roll out their own platform for rental agreements and that's why they're doing this? Because I can't really imagine why they want to just kind of expose everybody's properties to all of this liability.
[00:20:02] Speaker A: Well, I mean, I guess that's a possibility. They're. They're pointing us to air cover, which you know, is not perfect.
And I've even like done research on a bunch of cases and seen the times that Airbnb actually points the fin the host and says, hey, we're just an Internet platform and our air cover does not promise that we indemnify you.
So, you know, keep that in mind.
But I guess that could be a possibility. I don't know that they'd want to do that. I feel like that if they did something like that, then they are getting more into the less of an Internet platform.
I think it all went comes down to Avery, the getting the guest data, getting the emails, because I know some larger p property management companies just use a rental agreement for that purpose. You know, not necessarily for the protection, but for getting people's information, you know, grabbing that email address, grabbing those contact information. So I do think it goes more to that. I mean, we'll see. Maybe they'll roll out with a uniform rental agreement. It'll be just interesting to see.
[00:21:03] Speaker B: Okay, another question for you. This is getting a little deep in the. The lawyer and. But do you think, is there a legal pathway for if. Okay, Airbnb said no rental agreements. So a potential homeowner doesn't have a rental agreement, guest does something stupid, maims themselves, tears, like, burns the house down.
Is there a pathway that Airbnb might be liable for, maybe, you know, insurance claims because they blocked that homeowner from having that third party rental agreement in there?
[00:21:41] Speaker A: You know, potentially. I thought about it more from the signage perspective. Like, for example, you know, with this request thing, people are, like, debating whether you can still have pool signs or hot tub signs or safety signs, like warning of risk.
So, you know, taking the more extreme approach, saying, like, no, you can't have those anymore. You have to remove them, because those are rules that go beyond Airbnb, you know, terms. I think there for sure they would be opening themselves to more risk. Because then it's like, well, I would have had this sign, but Airbnb told me I couldn't have it.
And so that's why I didn't warn you. Because a PI attorney, a plaintiff's attorney would love to come to you and say, hey, you failed to warn me of that risk. You should have warned me that there was a cliff there. You should have warned me I couldn't dive in this water. You should have warned me that I could get hurt on this trampoline or whatever the case might be. They love making that argument. The personal injury attorneys love making the argument that you did fail to warn them of that risk and that's why they got hurt.
So, you know, if Airbnb is taking away your ability to warn of that risk, you know, there could be an argument that, like, hey, Airbnb, you caused this. This. Like, I would have, but you told me I couldn't. So I do think potentially they. They could unintentionally be opening themselves up to some liability there.
So, yeah, definitely a possibility.
[00:23:08] Speaker B: Gotcha. And these are all, you know, worst case scenario things. You know, I don't know what happens if.
I mean, I guess we're allowed to have them. Not smoke party.
Yeah.
So, okay, so what. What have I not asked that you feel like everybody needs to hear about? Because that was kind of. That was my train of thought on every. On all the questions I had for you.
[00:23:30] Speaker A: I think you covered a lot of it, I would say, just making sure, like, as your next step in the next 25 days or. I'm not sure. When this will air. But, you know, we got about 25 days from today, you know, till before November 20th. Just making sure that you're looking at your other areas of legal like the insurance, the LLC and your safety setup. You know, making sure you're offering a place that is safe, like so When I reviewed those 2,000 cases across the United States for lawsuits against Airbnb, what I noticed in terms of a pattern of types of cases was there were a lot of deck cases. So check your ducks, see if your ducks are stable. There were a lot of CO2 cases. So carbon monoxide. So make sure that if you're having things installed in your property, like water heaters. Water heaters was a big one. Have it done by a licensed professional and make sure you have those CO2 detectors.
And then slip and falls, of course, are very common as well.
So just kind of like thinking holistically, how can I reduce my risk? When was last time I looked at my insurance policy? Is my house in an llc? You know, all of that, I would say in the next, you know, before this November 20th hits. Just check on that.
[00:24:39] Speaker B: All right. All great advice. Always love having you on. Such a wealth of information. Thank you so much for coming on. If our listeners want to follow you on social media because they want to know more about short term rental law and things and what they're liable for and all that fun stuff. How do they do that?
[00:24:56] Speaker A: Yeah, for sure. So just go to Instagram and you can follow
[email protected]. katie and I do answer my DMs, so if you want to reach out there, I'd be happy to chat.
[00:25:07] Speaker B: All right, well, Katie, thank you so much for coming on, listeners. We'll see you next week.
Sam.
