Suspect Studio Apartment Rental

[quincy]

In New Hampshire; they said this is perfectly legal, and the NDA is so when people in town ask questions, we just say "yeah we're part owners" & nothing more. Even said down the line, if they sell the house, we'd get a small percentage as part owners if we're still there, but that we don't have to actually do anything but be tenants. They will do this with each new tenant.

Different municipalities in New Hampshire have different ordinances that can regulate and restrict short term rentals. One major concern with short term rentals is they turn residential properties into commercial properties. Other concerns with properties that are not owner occupied are that renters are not apt to care for the condition of the properties or care about the neighbors peaceful enjoyment of their own properties.

I recommend you check the local ordinances to see what the penalties are for operating a rental business in violation of the law. Those are the penalties you can face as a partner in this scheme.

Here are two links, one to the New Hampshire Bar on the legalities being debated in the state on short term rentals, and the other link to BNBCalc, a quasi-commercial link that offers a good guide on short term rentals in New Hampshire, with contact numbers for learning about the ordinances that restrict rentals in the areas where you are seeking to rent. The inclusion of this link is for informational purposes only.

https://www.nhbar.org/short-term-rentals-a-long-term-legal-debate/#:~:text=Some concerns raised with these,opponents see them as commercial.

https://www.bnbcalc.com/blog/short-term-rental-regulation/new-hampshire-guide#

In my opinion your best course of action is to avoid involving yourself in any way with the owner(s) of this property. The owner(s) will no doubt make you the fall guy should problems with the property arise.

 

[LdiJ]

Allegedly it's for name/official purposes only. I wouldn't have to deal with other tenants or do anything. They're responsible for fixes & everything a landlord would need to fix; their name goes on airbnb, & when I leave they'll "transfer" the LLC to the next tenant. I haven't seen any contracts/agreements yet. But even if this was legal, I'm really questioning the ethical side of things. I mean people like this must be part of the housing issue- those STR would be like $1,000/day in a tourist attracting area & the property owners don't even live/ aren't from NH

Members of an LLC are all equally liable for their actions as members of the LLC and legally liable for the actions of the LLC if the corporate veil is breached. As a member, you would have all of the responsibilities and liabilities of an LLC member (including income taxes on your percentage share of the profits whether they give you cash or not) without, apparently, any of the benefits. That is what makes it a very bad deal for you, and potentially makes it fraudulent.

Someone would have to offer me a huge discount on rent before I would ever consider something like that and even then, I doubt I would consider it.

 

[stealth2]

When something seems too good to be true/legal? It usually is.