CONTENDING WITH SHORT-TERM RENTALS

Published on: November 20, 2017

With Airbnb rentals on the rise, many condominium associations are faced with growing concerns about short-term rentals and the implications associated with the same, including safety and security issues, noise complaints and damage to the common areas.
As a preliminary matter, condominium associations may only restrict rentals of units if already provided for through the condominium’s governing documents, or through an amendment to the condominium’s constituent documents. To that end, some condominium governing documents prohibit utilizing units for transient purposes, and short-term rentals through Airbnb, clearly fall within that category. Also, some governing documents limit occupancy of units to residential purposes only, and the use of a unit as an Airbnb rental, could arguably be interpreted as a commercial enterprise.
Where there is already a rental restriction within the condominium’s governing documents, associations may demand that unit owners comply with the same, and pursue injunctive relief against unit owners whom fail to comply with the existing provisions within the condominium’s constituent documents. If the condominium association is ultimately forced to pursue injunctive relief against a unit owner to compel compliance with condominium’s governing documents, then the costs and expenses incurred by the condominium association with respect to the same, may be assessed against the offending unit owner, and such assessment shall constitute a lien upon their unit, until paid in full.
A more difficult situation arises however, when the condominium’s master deed and by-laws are silent as to rentals or they do not clearly prohibit short-term rentals and/or using the units for commercial purposes. It is not enough for the condominium’s governing board to simply enact rules and regulations to restrict rentals within a condominium, and in order for the association to properly amend their documents to prohibit short-term transient rentals, such as Airbnb rentals, the association must seek to amend the condominium’s master deed in accordance with the amendment provisions already set forth in the condominium’s governing documents, by obtaining the requisite unit owner and first mortgagee consent.
If an association is not able to secure the requisite unit owner and mortgagee consent to amend its documents, then there are still mechanisms through which the association may respond to issues involving transient tenants/occupants, including assessing fines against unit owners whom allow their tenants/occupants to create disturbances at the condominium which interfere with the peaceful enjoyment of the condominium by the condominium’s other residents and occupants. Also, an association may assess the unit owner for any costs associated with repairing any and all damage to common areas and facilities which is caused by their tenants/occupants. Additionally, if a unit owner habitually allows transient rentals and such rentals pose an immediate and demonstrable threat to the health, safety and well-being of the condominium’s other unit owners, residents and occupants and/or poses a risk of immediate property damage, then the association may seek to enjoin that unit owner from continuing to allow short-term rentals. Again, if such action is necessary, then the condominium association may assess all costs and expenses incurred by the association with respect to the same against the unit owner, and the assessment shall constitute a lien upon their unit, until paid in full.
Please contact Jennifer Barnett at jbarnett@meeb.com if you would like to discuss the adoption of an amendment barring transient/short-term rentals.