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Hi
Our unit block has a number of units that are short term rentals i.e. AirBnB. We have a 24/7 concierge Is it within the law to charge the owners who are renting out their units, short term, an additional charge or levy to cover the cost of added wear and tear and the use on the building – in particular the lift, foyer and corridors with the constant movement of luggage and people who have no reason to care if they do damage.. and the amount of time the concierge has to spend on Airbnb guest issues – for which all owners are paying?
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From your comment it appears that you have confused administrative charges with another type of charge – a ‘wear and tear’ charge.
Generally you cannot discriminate between occupants of the building.
There is an obligation on owner’s corporations to be reasonable in decision making.
The material used on the flooring should be sufficiently durable to withstand suitcases and other wheeled devices. If it isn’t then perhaps your building should consider installing something that will cope better with both foot traffic and suitcase traffic.
If cabin crew or airline pilots were to live in your building then they too would frequently take suitcases across the common areas. Parents with prams, people in wheelchairs or with mobility aids, all use wheeled devices that could accidentally bump walls etc.
If you believe that occupants are causing willful damage (rather than accidental damage) then you can always suggest the installation of CCTV cameras, in the common areas and if damage is found to be willful then your scheme could make a claim against the owner of the AirBNB apartments. Owners are responsible for the conduct of their guests and their invitees.
@Lady Penelope said:
Generally you cannot discriminate between occupants of the building.This is true … except where such a change of use means increased insurance costs, under section 82 (below). A smart strata scheme wishing to deter Short-term Holiday Lets might invite their insurer to increase premiums to cover the risk created by STHLs and then pass the increased fee on to the hosts.
82 Individual contributions may be larger if greater insurance costs(1) If the use to which a lot in a strata scheme is put causes an insurance premium for the strata scheme to be greater than it would be if it were not put to that use, so much of a contribution payable by the owner of the lot as is attributable to insurance premiums may, with the consent of the owner, be increased to reflect the extra amount of the premium.(2) The Tribunal may, on application, make an order for payment of contributions of a different amount to one or more contributions levied or proposed by an owners corporation on an owner if the Tribunal is of the opinion that the owner’s consent has been unreasonably refused under this section.(3) An application for an order under this section may be made by the lessor of a leasehold strata scheme, an owners corporation, an owner of a lot or a mortgagee in possession.The opinions offered in these Forum posts and replies are not intended to be taken as legal advice. Readers with serious issues should consult experienced strata lawyers.
@JonH said:
Is it within the law to charge the owners who are renting out their units, short term, an additional charge or levy to cover … the amount of time the concierge has to spend on Airbnb guest issues – for which all owners are paying?I think you could perhaps pass a by-law saying that the concierge will only service residents who are registered as lot owners or lessees under section 258 (below).
You would also take them to the tribunal seeking fines for failure to notify the lease or sub-lease as outlined in 258.
I think you could pass another by-law that institutes an “exceptional circumstances call-out fee.” This would cover all residents and apply to very specific cases of noise complaints etc etc after hours.
And, of course, the noise complaints or damage could lead to Notices To Comply to the Airbnb hosts, followed by fines.
258 Tenancy notice to be given to owners corporation of leases or subleases(1) If a lot is leased, the lessor must give notice of the lease, in accordance with this section, to the owners corporation not later than 14 days after the commencement of the lease.
Maximum penalty: 5 penalty units.(2) If a lot is subleased, the sub-lessor must give notice of the sublease, in accordance with this section, to the owners corporation not later than 14 days after the commencement of the sublease.
Maximum penalty: 5 penalty units.(3) If a lease or sublease of a lot is assigned, the assignor must give notice of the assignment, in accordance with this section, to the owners corporation not later than 14 days after the execution of the assignment.
Maximum penalty: 5 penalty units.(4) The notice must be in writing and specify:
(a) the name of the tenant and an address for service of the tenant, and
(b) the date of commencement or assignment of the lease or sublease, as the case requires, and
(c) the name of any agent acting for the owner in respect of the lease or sublease.
Note.An address for service of notices may be an Australian postal address or other electronic address, including an email address (see section 261).
(5) This section does not apply to the lease of a lot by the lessor of a strata leasehold scheme to a lessee who is the owner of a lot.
(6) A notice under this section is to be given to the original owner if it is given during the initial period of the owners corporation for a strata scheme.
The opinions offered in these Forum posts and replies are not intended to be taken as legal advice. Readers with serious issues should consult experienced strata lawyers.
A smart strata scheme wishing to deter Short-term Holiday Lets might invite their insurer to increase premiums to cover the risk created by STHLs and then pass the increased fee on to the hosts.
So if the insurance company requires extra security measures to mitigate their increased risk can these expenses be charged to the owners of units that engage in STHLs?
E.g. installation of CCTV and ongoing costs? Cost of replacement of security cards each time a new tenant rents the property after each rental?
After all these cards can be easily copied and used to gain access at a later date, possibly for nefarious purposes.
Maybe with a little creative thinking there could be ways to assign specific costs to landlords of STHL residences?
and the amount of time the concierge has to spend on Airbnb guest issues
Surely a simple sign referring these guests to their landlord and that it is not a matter that will be handled by the concierge should suffice?
A reminder that they are trespassing if they then fail to leave and that police/security will be called would set the scene that they need to deal with the correct person.
Details of unruly tenants and their landlord or unit number should be maintained and put on the minutes of each OC meeting so that correct records are kept of emerging and ongoing issues.
I helped a friend with an issue in a company title building where they had purported to pass a rule that imposed a charge/levy on owners of lots that were rented out. Now I was not convinced that it was enforceable, but that was the way it was, and as far as i know, still is. Of course that is company title and different considerations apply.
While it may sound like an attractive option for some schemes, I am not sure that the ‘increased insurance for common property’ argument against AirBNB will have any ‘legs’.
However, the OC can take action against a landlord (i.e. the Lot Owner) under limited circumstances to recoup any damage.
See here:
https://www.reinsw.com.au/Web/Members/Real_Estate_Journals/201601/Airbnb.aspx
The relevant extracts (from a representative of CGU) are:
“The fact that the damage was caused by a person residing in the property under a short-term letting arrangement does not have an impact on the building insurance,”
and
“in order for the Owners’ Corporation to take action against the landlord to recoup the costs of any repairs to the common property, they would need to prove that they knowingly breached their duty of care and obligations as a lot owner.”
@Lady Penelope said:
While it may sound like an attractive option for some schemes, I am not sure that the ‘increased insurance for common property’ argument against AirBNB will have any ‘legs’.This was a suggestion made by the recent outgoing Commissioner for Fair Trading. I can’t see why it wouldn’t fly, unless the additional insurance was plainly out of whack. As I said, find an insurer who will add the extra premium and take it from there.
The opinions offered in these Forum posts and replies are not intended to be taken as legal advice. Readers with serious issues should consult experienced strata lawyers.
JonH – Does your concierge keep a Log of: which Lots in the building needed assistance; at what times the assistance was needed; and what type of assistance was required by that particular Lot? Does your concierge keep a Log of ‘incidents’ that occur at your building?
Having substantiated evidence that you can rely on, such as a Log, may help you work through your problems.
Another suggestion: Are you able to take a look at the concierge’s contract to ensure that the concierge is not being asked, by a select number of Lot owners, to undertake functions that are not part of the contract?
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