By Andrea Brescia
In some communities, there can be controversy over short-term rentals, with some members being strongly in favor of rentals while others fight to keep the community limited only to unit owners. But the outcome of a fight like this will be largely dependent on the covenants and governing documents of the association. In a recent case, a court determined that short-term rentals violated the restrictive covenant.
Homeowners in a planned community asked a trial court for a temporary injunction, prohibiting their neighbors from renting out their home to vacationers for a profit. (A temporary injunction orders a party to do or not do something while a court case is pending.) The homeowners asserted that the rental of the home violated the restrictive covenants of the association, in part because they were using the home for nonresidential purposes—that is, operating a hotel.
No matter how large or small the community association you manage is, you’ll need to employ at least a few staff members. While they should receive training that’s specific to their job, there’s one type of training that’s necessary for everyone: how to abide by the Fair Housing Act (FHA). It’s easy to forget that maintenance workers, who fulfill many of their job duties without coming into contact with the community’s members, will sooner or later have interactions with home or condo owners.
Short-term condo rentals can help members in an association bring in extra cash. This is especially true when a condo is located in a vacation hotspot, like beach or winter sport towns. But short-term condo rentals have been argued over by many associations and members, with associations that are displeased with rentals claiming that they are a business that violates the covenants.
Facts: An association notified some of its members who were renting their units to vacationers that this was in breach of the restrictive covenants because they were essentially running a business out of their units. The members refused to stop renting their units. The association sued the renters. A Florida trial court ruled in favor of the members. The association appealed.
Decision: The appeals court upheld the trial court’s decision.
Q: Some of the economically distressed members in the community I manage have decided to lease their homes to tenants to help cover their expenses. At the same time, the landlord-members seem to have made paying assessments a low priority and may have become delinquent. Can an association collect rent directly from a tenant to pay any delinquent assessments? If so, what is the best way to do this?