Over a year ago, I wrote a blog post about the potential problems that AirBnB and similar short-term leasing websites, such as VRBO and Homeaway, pose for community associations. As explained in that post, Airbnb and its competitors are websites that connect property owners in various cities throughout the world who want to rent all or part of their homes on a short-term basis to travelers looking for temporary lodging in those cities. Since my original post, the number of condominium units and homes available for lease through these websites has only increased. For example, a quick search of AirBnB reveals more than 1,000 available listings in the Atlanta area.
Given the increase in popularity of AirBnB and similar sites, it’s clear that they are here to stay. And it may just be a matter of time before someone in your community decides to list their property through such a site (if they have not already). Thus, if your community association wants to prevent the use of AirBnB and the like, it is important that the association be proactive in doing so.
Your association’s legal right to prohibit and/or limit AirBnB and similar services depends upon the association’s recorded Declaration of Condominium or Declaration of Covenants. So, the single most important thing that a community association can do to be proactive about preventing or limiting AirBnB is to consult with its community association attorney to ensure that its Declaration contains language giving the Board of Directors authority over the type of short-term leasing offered by AirBnB.
Some community association Declarations may already contain leasing restrictions sufficient to prohibit AirBnB. For example, some Declarations specifically prohibit short-term leasing, including any lease agreements for a term of less than one year. Also, many Declarations limit the number of units/homes within the community that can be leased at any given time to a certain number or percentage (a “Leasing Cap”). If the Association is at its Leasing Cap, then any owner that leases property through AirBnb would be in violation. Further, Declarations often specifically prohibit owners from leasing less than all of their property, such that an owner who uses AirBnb or a similar service to lease out only one room in their home would also be in violation of the Declaration.
However, AirBnB and similar short-term leasing websites are a recent phenomenon, and as a consequence, many communities will find that their Declarations do not already contain provisions sufficient to prohibit them. In such cases, your community will need to amend its Declaration to add restrictions to prohibit AirBnB-type leasing. Your community association attorney can assist in creating an amendment to your Declaration that will provide the Board of Directors the right to prohibit or limit such short-term leasing. Communities considering amendments to prohibit AirBnB-style short-term leasing should keep in mind, however, that any amendment to the Declaration will generally require the approval of at least two-thirds of all of the owners in the community association, so any such amendment to regulate AirBnB style leasing will need the support of the majority of owners in your community.
To sum up, AirBnB and similar services continue to increase in popularity, so if your community association would like to limit or prohibit the type of short-term tenancy offered by these sites, it should review its governing documents with its community association attorney to determine its options for doing so.
*Disclaimer: This article was written by a member of NowackHoward Community Association Attorneys.