Protecting Your “Ass”et
You purchased a rental property and are excited to rent it out! But now the cold sweat sets in, and you’re thinking about the circumstance that every other homeowner in your shoes has thought of…
“What if my house gets trashed?”
We’ve all heard the stories, and the nightmares that followed. They’re talked about on the news incessantly and, not being local, you’re trying to figure out how you would even begin to handle a situation like that.
So let’s lean-in and talk about this! It’s not a fun conversion, but an important one. There’s a lot we do to not only proactively prevent situations like this form happening, but there’s also quite a bit of protection in place to make sure that, if this worst case does happen, you will be made whole for it.
Renting to the “Right” Guests
Here at Pocono Rental Management, we take a multi-pronged approach to make sure we’re inviting the right guests that have the right intentions going into their stay. A few different ways we handle this…
- Age Restrictions – sure, there’s a lot of mature 21 year olds that are looking for a getaway, but the fact of the matter is they over-index for immaturity and why rent to a 21 year old when you can rent to a 41 year old? Because of this, we put age restrictions in place (typically 25 years old) in order to avoid said circumstances
- Reviews, Photo ID – in order to “instantly” book one of our homes, you have to have a positive review from a previous host as well as having your ID uploaded to the platform. This greatly reduces the chance of someone who is new to the platform (Airbnb, VRBO) and doesn’t know the proper protocol when staying in another person’s home.
- “What brings you to the area?” – this is something we ask all guests, learning more about the details of their stay. This is a little more art than science, but sometimes you can get bad vibes from a potential guests if they are being curt, short, or don’t really have plans. There’s a big difference between “we plan on skiing with the family and hiking around Hawk Falls!” and “friendz get 2 getha”. We give this heavy weight when deciding who to host.
- Automated Guest Vetting – platforms like Airbnb/VRBO will autonomously comb through public records to make sure there aren’t any red flags going into a reservation. Some guests are banned from the platforms and others, before their stay, will have their reservations cancelled by Airbnb/VRBO based on some information that surfaced.
Protection against the unexpected
So while we implement these strategies to mitigate the chance of having a bad event happen, it does not make it a true zero. It’s not a crystal ball, and from time to time, an event mat happen where repairs have to be made, whether that be from an accidental incident or something nefarious. In those cases, this is how we approach it…
- Speak to the Guest – chances are, they are remorseful and want to pay for the damages. We usually approach it by saying “we know accidents happen and we would prefer not to go through Airbnb regarding this and trust we can find an agreeable solution”. We have our team take inventory of the damage, uncover what the replacement cost is, and pass those costs off to the guest. They agree to pay 90% of the time and this is our preferred route to recouping money for a bad stay.
- Airbnb Property Damage Coverage – Airbnb provides up to $1 million in property damage coverage. So if the guest refuses to pay, we have the option of going through Airbnb to create a case and be made whole for damages. Admittedly, Airbnb does require a high degree of proof, but the protection is there when needed and they do pay out on claims. (VRBO does not provide property damage insurance, only liability coverage).
- Homeowner’s Insurance – We highly recommend that all our homeowners are property insured and have authorization to rent out their home on a short-term basis with their insurance provider. It’s insurance. You probably aren’t going to need it, but in the chance that you do need it, it’ll save you a lot of hardship. We recommend Traveler’s Insurance, as they have a Home-Sharing Rider (below) that only runs about $100/year. Tough to beat that!
Please let us know if you have any questions! This is a very important topic and making sure you’re properly protected is a really important part of the equation when choosing to rent out your home.