HomeAway, VRBO and Airbnb Short-Term Rentals
Airbnb short terms rentals and it’s fellow services like – HomeAway and VRBO – have turned condominium complexes across the country into mini-hotels and resorts. From the perspective of some homeowners, this is a fantastic development. Not only has Airbnb made it easier for homeowners to rent out their homes to strangers from around the nation and even the world, it has indeed popularized the practice as an alternative to hotels. Many homeowners indeed now essentially make their living as hoteliers, buying condominium properties and renting them out for profit.
For their neighbors and homeowners’ associations, however, Airbnb can be a nightmare scenario which essentially defeats the purpose of living in a planned community with fellow homeowners dedicated to keeping up a standard of living. In the same way that no one ever washes a rental car, short-term renters – who are often on vacation and looking to blow off steam – can crowd out long-term residents from common areas such as pools, bbqs, and gyms, while flouting rules that they may not even be aware of, and annoying and even endangering other homeowners and residents in the process. So what is an HOA board to do?
Determine What Your HOA CC&Rs Say About Short Term Rentals
Most HOAs understand that homeowners want flexibility in being able to rent out properties to others, especially in situations where the homeowner cannot sell the property in a good market. But many HOAs are justifiably concerned about the risks that come with short-term tenants who have no ties to the community – and especially those who are there to live it up for a week, loud pool parties and all.
Thus, your HOA may already have a provision related to short term rentals which preceded the Airbnb craze. See if your rules mention a minimum lease duration requirement. It is not uncommon for CC&Rs to prohibit rental agreements for less than 30 days, or even 1 year. If you do have such a provision, you already have the tools to fight back against annoying short-term rentals.
Consider Implementing a Ban on Short Term Rentals
If you do not have a ban on HomeAway, VRBo or Airbnb short term rentals in place, enacting one might be the best and only way to combat the problems of short-term Airbnb tenants. You will of course need the approval of the homeowners because it will need to be an amendment to the CC&Rs, and you will want to determine whether your members are in fact in support of such a rule. It could be the case that a few long-term residents are disturbed by short-term tenants, but you could well have a majority (or at least a very vocal minority) of homeowners who want to be allowed to earn income from Airbnb, especially if you are in a high-tourist area.
Work with an HOA attorney in doing this to draft language that meets the needs of both the HOA and its members, and which will be enforceable under state law. You will also want to avoid potential legal action from homeowners who may well have purchased the property with the express purpose of earning short-term rental income, and an attorney can help you avoid these consequences.
Avoid Selective Enforcement of Rules for Short Term Rentals
One common way HOAs police Airbnb short term rentals or other fellow services is to fine homeowners a steep amount for every infraction, with successive infractions causing higher fines, e.g. $500 for a first violation, $1500 for a second violation, and $3000 for a third violation. Making the penalties high can be great for deterring violations, but they can also make HOA boards hesitant to actually enforce them. Also keep in mind that fines have to be reasonable. If fines is the route a board wishes to take it is very important that the board first adopt a fee schedule.
Your best bet is to enforce them whenever a violation occurs, as selective enforcement will not only lower the deterrence effect but open the HOA to reputational problems and even more legal issues. Again, work with an HOA attorney to enforce HOA short-term rental rules.
Contact an HOA Lawyer for Further Help
At Goodman Holmgren, our sole focus is on meeting the legal needs of HOAs, including creating and implementing HOA policy and responding to homeowner concerns. Contact us today to discuss any legal challenge your HOA is facing.