Garbage left carelessly by the pool area. Guest parking overflowing with unregistered cars. Loud music blaring until 2am. Vomit in the corner of the elevator. These are the very worst outcomes of short-term rentals.
Fortunately, for the most part, short-term guests are more respectful than this. People coming from out of town opt to book a condo unit on Airbnb, or a similar home-sharing platform, because they enjoy a more authentic travel experience and save a bit of money. And now that a global ban has been placed on parties by the company, renters are less like to disturb neighbors or cause damage to a property.
But condo and apartment communities may still be apprehensive about hosting short-term renters due to security and accountability issues. People don’t generally like the idea of strangers coming in and out of the building all of the time, and with a steady stream of renters taking up parking spots, it can be harder for other residents to secure guest parking for their friends and family.
A rental management system can help put these issues to rest though and help landlords or managers gain control of short-term rentals (STRs).
Do I really want to support short-term rentals?
As a landlord or property manager, STRs may present themselves as just another problem. But if there are no strict rules prohibiting these types of rentals, and if you’re not prepared to issue violations and/or fines every time a resident offers their place to a short-term guest, then it might be smarter to work with your community as opposed to against them.
Before you do anything, make sure your building can support short-term rentals
Depending on where you are, short-term rentals of less than 30 days may simply not be allowed. Some cities have banned short-term rentals because units were sitting vacant while residents struggle to find a place to live. A good example is New York. It’s illegal to rent apartments for fewer than 30 days in most buildings, particularly Class A dwellings. Other cities do not allow units to be rented out for “transient commercial occupancy” if the building is located in a specific area.
Your city may also have rules or requirements for STR hosts; they may need to obtain a permit or business license.
If there are no city rules geared towards short-term rentals in your area, it’s still important to review your building’s rules. They may contain strict policies about short-term rentals.
Communicate STR rules
STR rules should not be a mystery to your owners and tenants. Even if they are stringent, aim to educate your residents or tenants about best practices, rules and limitations.
Share the rules through email, create posters or pamphlets, and newsletters so that all residents know about the building’s short-term rental rules, and the consequences of operating illegal short-term rentals.
Use a rental management system that can be replicated and maintained
This part of the process will require a bit more work from management or tenants, but it’s the most efficient and organized way to manage STRs.
Managers/landlords have a couple of options to choose from, but the simpler the system is, the more likely people are to use it.
Once a resident has confirmed that a short-term renter will be staying in their unit, they will need to “register” the guests with the building. The registration system could be:
- A paper form that residents/tenants submit to the landlord or manager
- An online form that is emailed to the landlord or manager
- A spreadsheet that the manager/landlord maintains once they have information about a new guest
- A digital guest registration and rental management platform that allows residents or management to add a new short-term stay
While there isn’t a correct choice, it’s important to adopt a system that is easy to replicate and maintain. This ensures that guests still make it into the system, even if a new manager takes over or someone is covering for the landlord.
By giving tenants the ability to register STR stays on their own, the workload is reduced for management. That’s one big reason why many would prefer having a digital short-term rental management system like Condo Control. With a standardized registration page, secure cloud storage, and easy editing options, this STR tool makes it easy for landlords and managers to stay in control of short-term rentals. Plus, STR hosts can log every stay without having to take up management’s time.
Benefits of using a digital short-term rental system
In addition to having a record of who has and will be in your building, there are other benefits of having a standardized STR system in place:
- Searchable record of short-term guests, past and future
- Option to see how often an owner/resident rents out their unit
- Welcome letter is automatically sent to short-term renters. Any special instructions or information will get to them before they arrive on the property
- Option to create custom terms and conditions that align with your property’s rules
- Security/concierge can easily confirm which vehicles belong to registered short-term guests
- Guests can be contacted directly if there are any issues during their stay
What happens if tenants are bringing in short-term renters without registering them?
Most residents will comply with STR rules and processes, especially if they are reasonable and easy. However, if there are reports of problematic or unauthorized guests that are linked to the same unit, it’s important to take the appropriate actions. If there are no consequences for ignoring rules, then there is little motivation for anyone to follow them.
Educate the resident
Before taking more severe actions, make sure you remind the resident about the rules and processes for hosting short-term guests. Invite them to ask questions in case they aren’t entirely sure of the registration process.
If the resident has received a friendly reminder and continues to ignore the rules, then the next step is usually to issue a violation notice. You may have to issue several notices before you can fine the resident. Depending on the property, fines may not be an option, however, you can obtain a letter from a lawyer instructing the resident to stop hosting guests who are not registered.
Condo buildings will have their own fine schedules, but they can be as much as $500 each night if the short-term rental rule is broken. There may be limits on how much you can ask a resident to pay for the same violation, so check with the governing documents before you begin issuing fines.
If fines still don’t discourage a resident from breaking the rules, mediation might be the next step. Mediation is a process where a neutral facilitator will try to help the association or building, and the resident, find a mutually agreeable solution. Mediation is often preferable to litigation because it’s less costly, but it can still be a challenging process.
If you cannot come to an agreement with the resident through other methods, then arbitration is the last option before taking the issue to court. Arbitration is a process where an arbitrator conducts a hearing and makes a ruling based on the issue based on the facts presented by the parties. The arbitrator makes a binding decision, meaning the parties are legally obligated to follow the decision that they made.
Short-term rentals can create some discomfort amongst condos and apartments, but it doesn’t have to be a contentious issue if management can implement a system that supports consistency and transparency.
Author: James Corbett