This article is about how to stop Airbnb in your strata building.
Airbnb and other short-term letting sites have taken Australia by storm. Unfortunately, these rentals often negatively affect the neighbourhood around them.
How to stop airbnb in your building
This is particularly true if the listing is in an apartment block. While it’s often the impact on the quality of life that residents complain about – people coming and going all the time are hardly good for creating a community feeling, even if they’re not having loud parties – short-term rentals can also expose residents to problems like:
- Unsecure buildings – Once shared, keys and swipe cards can be easily copied. Lockboxes can be broken into and their apartment identified. The strangers staying in a short-term rental down the hall aren’t going to be as carefully vetted as a long-term tenant, which is why drug parties and pop-up brothels can occur now in any building.
- Uninsured property damage – Damage to common areas or other apartments that results from a short-term rental sometimes isn’t covered by a strata insurance. That’s because apartments are being used commercially, not residentially, which means the insurer wants a higher insurance premium to cover the extra risks. It’s easy for strata to get caught out if they don’t know it’s happening.
- More wear and tear – Typically about twice as much, especially on lifts. The owners who put up the listings get all the benefit, while the building’s other residents must deal with the extra costs and risks.
We’ve found that 5% of units in most buildings in high-demand areas are listed on short-term rentals sites. Often it’s much higher – the most we’ve found is 40%. The most popular areas are those close to tourist attractions and to universities, but increasingly we find unwanted short-term rentals throughout major cities and in the countryside.
Strata buildings in Australia often don’t have a lot of options to push back against unwanted sublets. This sometimes makes it difficult to find out how to stop Airbnb in your building. Unless the state has passed clear legislation (eg WA blocks it without council consent, while SA allows it), most battles with owners will end in the courts or tribunals. In Victoria and NSW, so far these have supported the owners.
Still, strata buildings have a few options to control short-term letting. So, find out how to stop Airbnb in your building:
- Report them
In most states, short-term letting rules are defined and enforced by local councils. Councils don’t like it when a unit zoned residentially is used commercially, and usually, the host doesn’t bother getting the correct permissions.
One word of warning, however – while anyone can report an infraction, it’s up to local councils to enforce these rules, which they do to varying degrees with their often stretched resources.
You can also threaten to report activity to the ATO. It isn’t clear yet how often host income isn’t reported and taxed in Australia, but it’d be very easy not to, and the ATO is taking a special interest in it. There are also capital gains implications for using a property commercially which the ATO will be keen to enforce.
If a tenant is listing the unit online you can report them to the unit’s owner or property manager. They’re very unlikely to have permission and so are probably breaking their lease and will stop quickly rather than face eviction.
- Pass bylaws
The rules, precedents and best approaches vary by state and, unfortunately, often local council as well. It’s best to get legal advice on whether a strata bylaw will work for your situation. But a common strategy used by strata buildings is to pass bylaws saying all residents must follow local council regulations. This allows them to take action when an owner flouts commercial-use restrictions in their building, without having to rely on councils to enforce them.
- Get help
You’re not alone with this problem. Encourage your residents to report any suspicious behaviour they see. Most don’t want holiday rentals next door and will be keen to report any strangers coming and going with luggage, or rules infractions these strangers do.
You can also use a cost-effective monitoring service like BnbGuard. Our advanced technology monitors more than a dozen sites for you, reporting any online ads for units in your building. We also stay on top of new sites that spring up – and there are more every day – to make sure you know what’s going on in your building.
This post appears in Strata News #184.
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Reuben Schwarz
BnbGuard
E: [email protected]
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Most Body Corp By-laws prohibit conducting business in the lots. Letting your lot out to AirBnB should rightly be considered conducting a business.
Also, a definition of “acceptable use” of the lots may be listed as residential. If there is no “resident” it can not be residential. I believe one judge has already made that determination. but I don’t have the reference to hand.
My local government recently approved the use of short term stay in a neighbouring 100 apartment residential block.
I am concerned about insurance, what if the building burns down (and fire damages my property) and the building insurer says they wont pay because the strata company did not amend their building insurance policy to cover short term stay which is an increased risk.
I searched the internet and discovered that AAMI, for example, doesnt provide residential strata insurance for short term stays.
A big legal minefield, in my opinion.
An owner ( investment property) in our complex has been leasing a unit on Air B n B without informing the Owners Corp./Strata Manager or local Council. They have now been reported to the local Council, in the Perth WA region and are seeking planning permission to let via Air B n B. The Owners Council have objected, but our strata managers inform us that under the new WA strata legislation it would take a 1oo per cent vote in favour of banning short stay accom. in the complex, which seems completely unfair. It seems that the State government and local councils have been caught short with the rise of short stay accommodation and there are gaps in the regulations/legislation – a lack of foresight by policy makers. ”
Interesting that the local council have not advised the owner to cease advertising on air b n b, even though it is technically a breach of the town planning regulations. Some councils have prosecuted owners for this – as it is a commercial let not a residential let.