Airbnb is one of the worlds top sharing economy platforms, providing homeowners with the opportunity to rent out their properties quickly and profitably. With over 6 million listings across the globe, and over 2 million guests booking through this platform every year – the attraction is apparent.
The benefits of Airbnb are clear; offering tourists and holidaymakers a chance to stay in more intimate surroundings while giving homeowners the potential to compete with the hospitality industry and make additional income.
While Sectional Title Rentals are quite commonplace; there is a massive difference between short-term holiday letting (such as Airbnb) and long-term rentals, where tenants are adequately integrated into the rules of a Scheme. And as such, some Sectional Title Schemes are not too fond of this short-term rental revolution.
This apprehension typically stems from the expected disruption caused by short-term tenants and the security issues surrounding increased traffic within a complex or estate.
So How Can Your Scheme Effectively Manage Airbnb Rentals?
Debates regarding the issue of short-term rentals, particularly regarding Airbnb, is an ongoing issue. Some have argued that Airbnb letting is the same as running a commercial business, while others claim that it is no different than traditional letting.
Thankfully, the Ombud for Community Housing Schemes has shed some light on the issue, stating that the trustees of a Scheme are allowed to include conduct rules preventing these types of letting. However, trustees will have to get approval from the owners in the Scheme and are not allowed to make unreasonable rules surrounding short-term letting.
Conduct rules can only be amended or created if the Body Corporate comes to a special resolution by taking votes at a general meeting or through a written agreement. For a special resolution to be proposed, a quorum of Body Corporate members must be present. To pass such resolutions, a minimum of 75% of members must vote in favour of the decision.
According to Karien Hunter, Director and Founder of PropDirect, Body Corporates should keep the following in mind when managing Airbnb letting in their Scheme: “Bear the above in mind before letting out a unit and be careful when marketing a unit for sale on the basis that the unit can generate an income from short term letting such as Air B&B without checking out the Conduct Rules and any proposed changes.”
We suggest that owners in a Sectional Title Scheme, who are planning on renting out their units, double-check with their Body Corporate and the conduct rules of the Scheme. If you are a trustee or a member of a Body Corporate and need advice on how you should manage Airbnb letting within your unit, we can help.
Get in touch with us today for this and other Body Corporate Management queries.