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How Should Your Condo Association Handle Short-Term Rentals?

Home-sharing has greatly increased in recent years since websites like Airbnb.com have become popular. These services work by connecting people looking for a place to stay for a night at a time with homeowners who are willing to rent out their home, or a bedroom.

This is a convenience for many travelers, and a nice way for owners to earn some extra money; however, there are conflicts when that owner is part of a condominium association and run by a condo association management company because the bylaws may not allow it. As a condo association board, you should be wary of these services.

Watch Out for Short Term Rentals 

The first issue for sites like Airbnb.com for condo is the safety issue. The renter through these services gets access to common areas, facilities, and condo amenities on the property—and these renters aren’t responsible for fees, so there is a chance they’ll take advantages of these privileges or damage property that is only meant for your homeowners.

It’s also concerning whether the short-term renter will be covered under the master insurance policy of the condo. For example, what if the renter gets injured while in the building’s common areas or if they cause damage? The lines are blurry on whether the policy will cover the incident.

What You Can Do

Since it’s clear short-term rental services are not going away any time soon, it’s smart to be proactive by adding protective language to your condominium laws. An example would be stating that condo owners can rent their units out temporarily, but there must be a minimum rental period.

It’s also smart to implement the rule that owners must rent each unit as a whole instead of individual rooms. Lastly, you’ll want to require that all rental leases are in writing, then signed and submitted to a trust before the rental happens.

As a condo association, it’s your duty to make sure rules are properly enforced for all unit owners. The upside is that short-term rentals are good extra cash for your owners, but you have to consider all of the liability risks, such as safety and damage. Since the trend of short-term rentals is here to stay, it’s better to find ways to work with the changes rather than resist them. If you’re having trouble with implementation, work with your property management company to develop the best solution for your community.

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