JUNE 17, 2025
#137- 6 Airbnb Legal Mistakes That Can Derail Your STR Business
Are you unknowingly risking your Airbnb or short-term rental investment because of overlooked legal details? In this episode recap, we break down the biggest Airbnb legal mistakes that can blindside even the most seasoned hosts. Attorney and STR investor Katie Johnson shares how a side hustle in Michigan turned into a full-scale legal battle—one that could impact short-term rental owners nationwide.
From hidden deed restrictions to complex zoning laws, Katie’s firsthand experience is a cautionary tale and a masterclass in how to protect your hosting rights. Whether you’re just getting started or already managing multiple properties, knowing how to navigate these legal pitfalls is non-negotiable.
From Side Hustle to Legal Showdown: Katie’s Airbnb Origin Story
Katie Johnson began hosting on Airbnb like many others—with optimism and a good investment. But what started as a promising short-term rental venture quickly became a battle against Park Township, Michigan, which tried to ban vacation rentals altogether.
Instead of backing down, Katie rolled up her sleeves, rallied other property owners, and fought the ordinance in court—becoming a legal advocate for over 100 hosts in the process.
Airbnb Legal Mistakes That Could Cost You Big
Katie’s journey exposed the most common Airbnb legal mistakes that catch hosts off guard:
1. Ignoring Deed Restrictions
Many STR owners don’t realize that deed restrictions—rules written into property records—can prohibit short-term rentals altogether. These are often missed during the buying process but can render your property unusable for STR purposes.
2. Relying on Surface-Level Research
Zoning laws are nuanced and vary widely by location. Katie emphasizes that reading city ordinances isn’t enough. Hosts need to:
- Review HOA rules
- Understand residential vs. commercial zoning language
- Watch for ambiguous clauses that may be used to block STRs
3. Not Hiring a STR-Savvy Attorney
This was one of Katie’s biggest takeaways. Self-research can only go so far. A real estate attorney with short-term rental experience is critical—not just for purchase due diligence, but also for legal defense if regulations change later.
Building a Legal Defense: Lessons from Park Township
When Park Township attempted to ban short-term rentals, Katie didn’t just protect her own investment—she built a coalition. Here’s how she and others fought back:
- Organized STR Owners: Strength in numbers was key. Katie united local hosts and property owners to create a unified voice.
- Structured a Legal Fund: They raised funds to hire legal representation and build a strong case.
- Formed a Nonprofit Board: Katie emphasized the importance of creating a well-rounded leadership team with legal, communication, and financial skills.
Advice for Hosts Facing Legal Hurdles
Katie offers actionable guidance for those navigating similar situations:
- Hire Local Legal Help: Choose an attorney familiar with your town’s board, zoning laws, and legal history.
- Stay Proactive: Don’t wait for a crisis—research your legal landscape before buying.
- Build Your Community: Join or create coalitions of STR owners to stay informed and united in advocacy.
Empowering Women in STR
Katie is passionate about supporting women in the short-term rental space. Her advice?
“Find people who are doing the same things. Find people who are thinking big like you. That’s been immensely helpful.”
Women in STRs should invest in legal education, mentorship, and community to stay empowered and protected.
Final Takeaways: Don’t Let Legal Mistakes Derail Your STR Dream
This episode isn’t just a legal deep dive—it’s a wake-up call for every Airbnb host who wants to grow a resilient, profitable STR business. The biggest Airbnb legal mistakes aren’t always obvious, but they’re preventable when you’re informed, connected, and proactive.
HIGHLIGHTS AND KEY POINTS:
[01:19] A short introduction about our guest Katie Johnson and how she got started in the short term rental space
[04:22] What is a Deed Restriction and why should short term rental owners be on the lookout for them
[07:05] Michigan’s interpretation of residential zoning in relation to rental types
[08:04] What should you do if you encounter unclear language in a Deed Restriction or zoning rule
[08:54] Katie explains how deed restrictions are typically created and is there a way to get it removed
[11:05] Katie weighs the risks of self-research versus hiring an attorney for deed restrictions
[14:01] Katie shares her firsthand experience challenging a short-term rental ban in Park Township, Michigan
[16:44] Katie outlines the process of organizing short-term rental owners in response to a local ban
[18:00] How the short-term rental owner coalition quickly scaled, structured funding, and secured major legal support
[22:18] Katie outlines the ideal mix of skills and roles needed to build an effective nonprofit board for STR advocacy
[24:52] Katie’s experience navigating post-lawsuit challenges to preserve STR rights in Park Township
[27:10] Katie’s shares her personal and professional transformation through STR litigation involvement
[29:33] What does Katie advise hosts who are facing similar scenarios involving local restrictions or ordinances
[32:37] Katie’s advice for women in STRs to protect themselves and their businesses
Golden Nuggets:
- “Getting organized and banding together, finding an attorney, a local attorney, ideally, that knows the board or knows the town that you’re dealing with to help you navigate through this process, is the best advice I can give anyone.”
- “Finding people who are doing the same things, finding people who are thinking big like you, that’s been immensely helpful.”
- “If the numbers work, you should buy it like you can buy everything you can. So I wish I had started buying earlier.”
-
Let’s Connect!
Website: katiejohnsonplc.com
Did you enjoy the episode? Don’t forget to Subscribe, Rate, Review, Like, and Share!
FOLLOW ME ON
Hey, you!
If you’re a fan of my show, I want to say THANK YOU. Seriously, from the bottom of my heart – I couldn’t do this without you.
There’s one thing that would make me even more thankful – having your support through ratings and reviews on your preferred podcast player.
This helps me reach more people (just like you) who are eager to achieve their STR goals and dreams.
It’s super easy – just click here, scroll to the bottom, tap to rate with five stars, and select “Write a Review.” Then be sure to let me know what you loved most about the episode!
Also, if you haven’t done so already, please follow the podcast.
I’ll be adding a bunch of bonus episodes to the feed and, if you’re not following, there’s a good chance you’ll miss out!
Thanks again, sister – and cheers to your STR success!
