Consumer Reports: Listing your home as a hotel

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Before you jump into the sharing-economy, Consumer Reports says there's a few things you'll need to consider before you turn your home into a hotel. (WLS)

Vacationers' search for alternative getaways has contributed to a $100 billion industry, with millions of people worldwide listing their homes on websites like Airbnb and VRBO to generate income. But before you jump into the sharing-economy, Consumer Reports says there's a few things you'll need to consider before you turn your home into a hotel.

Websites like Airbnb, FlipKey, and Homeaway have made it easier than ever for homeowners to rent out their homes. That's what motivated Fred Nelson to post his Catskill, New York vacation abode.

"I bought this as a vacation home, so the thought of renting it out to others who are looking for a vacation getaway made perfect sense. That was kind of a no-brainer, to be able to list it on a site, and let other people enjoy it as well," said homeowner Fred Nelson.

And the market is strong. According to a survey by Consumer Reports 75 percent of people who've never used a homestay say they'd consider trying it.

How to start renting your home? Consumer Reports says the first thing to do is make sure it's legal.

"Vacation rentals aren't legal everywhere, so you've got to look into the local laws before you list your home," said Consumer Reports Money Editor Lauren Lyons Cole.

Your town or city hall can tell you what's legal in your area. And consider a call to your insurance agent and your accountant.

"When you're renting your home, you're essentially running a business, which means you've got to think about things like the type of insurance you need and whether or not you're going to owe taxes on the income you earn," Cole said.

As for Fred Nelson, as long as renters keep coming, he'll keep posting online.

"I listed it maybe two weeks ago, it's booked up for the entire summer. So, it can be a nice little way to supplement the income and help defray the mortgage, quite frankly," Nelson said.

Consumer Reports also says outfitting your home with a keyless lock, reliable coffee machine, and comfortable mattress will make it a more desirable rental.

All Consumer Reports material Copyright 2017 Consumer Reports, Inc. ALL RIGHTS RESERVED. Consumer Reports is a not-for-profit organization which accepts no advertising. It has no commercial relationship with any advertiser or sponsor on this site. For more information visit consumerreports.org

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