What Condo Boards Should Consider Regarding Short-Term Rentals

New York condo owners, co-op shareholders, and residents who list their homes on Airbnb need to be aware of the recent heightened restrictions recently imposed by the state legislature.

On October 21, 2016 New York State cracked down even further on those who offer their homes on Airbnb, Home Away, and other similar services. Although New York City already prohibits leases fewer than 30 days in multiple-dwelling buildings, they have substantially increased the fines for those who disregard the law. According to a recent article in Multi-housing News, owners and renters now face fines that range from $1,000 up to $7,500.

Despite the steep fines, short-term rentals will most likely remain popular, because it is a win-win for both travelers and unit owners. Short term vacationers can enjoy unique vacation experiences and save on accommodations, while owners can monetize their living spaces and earn extra cash. Demand is especially high in destinations with expensive hotel rates such as New York City, Chicago, Miami, and Los Angeles. For example, Airbnb hosts in New York brought home more than $1 billion in 2015!

Therefore, managers of multi-family buildings both in New York and across the country should take advantage of the new legislation to educate housing boards about short-term lease restrictions and how to lessen the possibility of overall risks that rentals can pose.

Here is a quick checklist for boards to review and consider:

  • Confirm building’s governing documents and rules related to short-term rentals are understandable. It is critical that a building’s by-laws – as they pertain to apartment leasing – are easy to interpret. This is important so potential hosts cannot claim they did not understand the rules. Airbnb itself is very strict with hosts that do not do their due diligence regarding building-specific rules. Their ranking can be penalized and they can even be removed from the site.
  • Ensure unauthorized guests do not gain entry, and update procedures to document and track short-term occupants. Instruct front desk team and all other staff to forbid strangers or unauthorized guests from entering the building unless the owner is present or has given prior written authorization.
  • Consider enhanced training for staff and communication to ensure short-term renters understand the building’s safety procedures, services, amenities, and shared spaces. When short-term renters are not familiar with the building’s offerings it can impact the ambiance of the property for all residences. In addition, where permissible, boards should ensure that apartments being used for the short term follow all the safety requirements, including fire escape procedures.

 

Although changes in regulations may continue to arise, short-term rentals are likely here to stay. It is incumbent upon the boards to remain vigilant and update their policies accordingly.

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About Author: Condo.com Team