News/Articles

Letting your Home or Holiday House for Short Term Rental

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With easy to use websites such as Airbnb or BookaBach it is becoming increasingly popular for many New Zealanders to let their holiday houses, or their main home, to short-term visitors. Any why not?! It is a fantastic way to make an additional income for your household. There are a few things however that you should consider before letting out your property for this purpose which include the following;

Council requirements

Check your District Plan for permitted activities in your zone. The local council will usually regulates short-term visitor accommodation activities and these obligations do differ from council to council.

Making your home available to family and/or friends at no charge, and letting your property long-term, are not activities regulated by your local council but if you are letting your house on a frequent basis, it is possible that a resource consent will be required. For smaller-scale or infrequent activities, you may only need to notify your local council of your activities.

Contractual matters

If you engage a provider such as Airbnb to connect you with visitors, you should check carefully the terms of your contract. You need to be clear on your rights and obligations, as well as those of your provider.

Health and Safety

If you engage other people to look after the maintenance of your holiday house, it’s likely that your holiday house will need to comply with the Health and Safety at Work Act 2015. As someone who is responsible for a ‘workplace’ you must take all reasonably practicable steps to ensure that no workplace hazard causes harm to ‘workers’ such as gardeners, cleaners and tradespeople.

It’s also important for you to identify those parts of your property that may pose a possible hazard/risk to your visitors (such as swimming pools, fireplaces and balconies).

By taking practical steps to address any potential hazards, you can ensure that your visitors have a safe and enjoyable stay.

Bank approval

Your bank may have a security interest in your property. If so, the terms of your mortgage documentation will specify certain activities for which the consent of the bank will be required. One of these potential activities may include the letting of your property for short-term visitor accommodation.

We strongly recommend that you check with your bank as to whether it’s happy with the letting of your property in such a manner. It’s unlikely that your bank will take issue with such a proposal, but it’s prudent to keep it informed.

Insurance

It’s always good practice to notify your insurer of your visitor accommodation activities. This will ensure that your insurance policy can be adjusted whilst your property is being let.

Tax

There are likely to be tax implications if you’re letting out your house. We recommend that you contact your accountant/financial adviser to discuss your tax situation.

The short-term letting of private homes as visitor accommodation can benefit both homeowners and visitors alike. It is, however, important that as homeowners you are aware of, and take steps in respect of, the types of obligations we have highlighted above.

(Article first published in the Hamilton Press, March 2018)

Hayley Willers

About the Author:

Hayley is an experienced property lawyer who deals with a broad range of private and commercial property matters including residential and rural conveyancing, subdivisions, refinancing, retirement villages, relationship property, trusts, wills and enduring powers of attorney. Hayley acts for small/medium businesses, local government, public sector and private clients. She is actively involved in the Raglan community and is the current Co-Chair of the Raglan Chamber of Commerce Board.