The "7-Day Rule" for Short Term Rentals

How to qualify as a short-term rental. Now, under this, there's two tests as well, and we have to check the box on both of them. The first one is the average stay of your guest. It has to be less than 7 days. Let's do some math here on this average stay. Let's say you rented the property for 10 total weeks last year and you had 5 tenants. Well, we're going to have a problem. 10 weeks divided by 5 means your average stay was 2 weeks. But if you rented it for those same 10 weeks but had 20 tenants during that same time period. That would be an average of about 3.5 days, which is very common with Airbnbs. You might have people stay for 2 nights or 4 nights or somewhere in between. So you take your total rental days divided by the number of patrons, and there gives you your average stay. It's got to be under 7. Now the second rule is that you cannot provide substantial services. You can't treat it like a bed and breakfast or a hotel. You're not there every morning in the kitchen cooking up bacon and eggs. You're not providing turndown service with a little mint on their pillow. You're not cleaning the place every day. You're not providing concierge services or, you know, massages in the garage. You can't do any of that. That's what you would get at a hotel or a bed and breakfast. It's a short-term rental. You're going to clean it when they leave, and that's it.