I own my house outright and have a nice guest bedroom that sits empty most of the time. A friend suggested I could make some extra money by listing it on short-term rental platforms, but I have no idea what taxes or regulations I'd need to deal with. Do I need to inform my insurance company? Are there zoning restrictions I should know about?
This isn't really a "spare time" decision - it's got some serious legal teeth depending on where you live. You absolutely need to notify your insurance company first because most standard homeowner policies either prohibit short-term rentals or require you to add a rider, and operating without that coverage could leave you exposed if something happens. Your local zoning laws might restrict it too (many residential areas don't allow it or cap the number of days per year), your city may require permits or licenses, and you'll owe taxes on the rental income - some jurisdictions also have occupancy taxes that you'd be responsible for collecting and remitting.
Before you list anywhere, I'd check your local municipal code online or call your city planning department to see what's actually allowed in your area, then talk to your insurance agent and probably a tax professional about what you're getting into. The setup varies wildly by location, so there's no one-size-fits-all answer here.
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