By now, you should be no stranger to Airbnb. The popular vacation rental platform allows owners to rent out their properties to guests, while guests get to enjoy accommodation that’s full of personality (at a reduced price tag too!).
For owners, Airbnb isn’t just an outlet to rent out their extra rooms or unused units, it also serves as a form of side income.
During these uncertain times in particular, many Malaysian hosts have even become reliant on their Airbnb income to pay their bills.
Based on an Airbnb survey of over 2,000 Malaysian guests and hosts, half indicated that Airbnb helped them in settling their loan payments, while 40% said the platform provided them with supplementary income.
Malaysia has also been Airbnb’s fastest growing country in Southeast Asia for two consecutive years straight.
Sounds inspiring? You’d be even more inspired to know that Airbnb started off with just three college roommates, who couldn’t afford their San Francisco rent.
The idea started out with them transforming their own loft into a bed and breakfast, complete with air mattresses (hence the “Air” in Airbnb).
While this may inspire you to turn your own home into an Airbnb, you might want to take a couple of things into consideration first.
What You Need To Know About Airbnbs In Malaysia
In Malaysia, Airbnbs are considered short-term rentals (STR). Short-term rentals differ from long-term rentals by their rental duration and purpose of renting.
STRs are typically rented out for a few nights or weeks, and are usually for vacation, business, or event purposes. Our handy guide here explains all you need to know about short-term rentals in Malaysia.
Airbnb Income vs Rental Income
From an investment perspective, Airbnb and other short-term rentals can actually be more profitable, compared to long-term rentals.
While hosting an Airbnb is no easy feat, the daily rate you receive for a short-term rental like Airbnb is substantially higher than the average daily rate you would get for a long-term rental.
Of course, this also depends on many other factors such as your Airbnb’s location (amenities and connectivity!), property type, and how well you furbish it.
Is Airbnb Legal In Malaysia?
Yes, Airbnb is legal in Malaysia. Despite their popularity however, they continue to remain largely unregulated.
With no federal laws to provide blanket guidelines or restrictions, local state governments have taken it upon themselves to regulate Airbnbs within their respective territories.
In Sabah for example, the Kota Kinabalu Municipal Council (DBKK) considers AirBnb a “lodging house”, and are therefore subject to the Hotels and Lodging Houses By-Laws 1966.
This means that among others, Airbnb hosts must:
- Apply and seek approval for for a lodging house license to operate.
- Be situated on lands zoned for commercial or commercial mixed-use only.
- Comply with fire safety requirements.
So, while Airbnbs aren’t technically outright illegal, Sabahan hosts must comply with the requirements stated in the Hotels and Lodging Houses By-Laws 1966.
Given that most Airbnb hosts are operating out of residential properties, this restriction does rule out many Sabahans from transforming their homes into a dream Airbnb for tourists.
Here are some other examples of state-specific laws:
Sabah (DBKK)
Illegal to operate Airbnb without a license
Comply with all requirements stated in the Hotels and Lodging Houses By-Laws 1966
Penang (MBPP)
Unclear regulations
Airbnb operators may be prosecuted under the 1991 MPPP bylaw for Trade, Business and Industries for operating a business without licence
Kuala Lumpur (DBKL)
Legal to operate Airbnb if permitted by building management
Refer to building management and by-laws
Your Condo Management Has A Say Too!
Guess what? It’s not just your state council who has a say in what you do with your property.
Say you’ve got a fantastic condominium unit in Kuala Lumpur. It’s walking distance to an LRT station, no further than 10 minutes from the best tourist destinations, and you’ve spent a fortune in fixing it up.
You’ve checked, and operating Airbnb is legal in your state. You can dive in headfirst now, yes? Not so fast. Remember to check with your condo management too!
Under the Strata Management Act 2013, your building’s Joint Management Body (JMB) possesses the authority to make additional by-laws as they see fit.
Md Azmi Mohd Shari, a legal officer from DBKL’s valuation and property management department, has stated that in the case of strata properties, whether or not you’re allowed to host an Airbnb is up to your building’s management.
What’s The Penalty Fee Like?
Let’s run through that one more time. Owners of strata properties looking to operate an Airbnb unit have to make sure that it’s permitted by their condo management.
Remember that strata titles are typically issued to units of houses, or high-rises, within a development that share common properties.
It’s these common properties (such as parking bays, lifts, and swimming pools) that typically make things a little more complicated.
Under the Strata Management Act 2013, the condo management has the right to impose a fine of up to RM200 to anyone who is in breach of any of the building’s by-laws.
To Airbnb Or Not To Airbnb? Check With Your Management!
If you decide to explore the promising income opportunities that Airbnb can provide, just make sure to check with both your local council as well as your management first. You could be saving yourself a lot of trouble (and money) in the long run!
Interested for more tips on how to successfully operate an Airbnb? Click here for our Ultimate Guide to Effectively Managing Your Short-Term Rental Property.
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