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Is corporate accomodation the same as short-term letting?
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Mondowavo
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10/10/2018 - 10:21 am
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A new owner in a block of four two-bedroom units is an out-of-state company that is expanding its business to NSW, who are using the unit ostensibly as temporary digs for their interstate execs and employees as an alternative to hotel accommodation. It’s essentially unpaid short-term renting. People come in ones or two or more and stay a few nights, maybe a week. Also relatives and friends of the company’s owners have stayed there for an interstate holiday. As expected, problems similar to those caused by Airb’nbers have resulted – sometimes the visitors are noisy, they don’t know or follow the strata rules regarding garbage bins, recycling etc. Just wondering if this sort of tenancy is legal or permissible under NSW strata laws?

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braveheart
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10/10/2018 - 3:47 pm
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Hi Newbie,

We had a ‘problem’ tenancy just as you describe operating in our block for several years. A corporate organisation arranged to lease a residential apartment and were referred to as ‘the tenant’ but no individual actually resided their full time – just a passing parade of casual groups staying for periods ranging from a couple of nights to several weeks, usually arriving and departing very late at night or early mornings. Noise and rubbish were often a problem. The unit owner was uncooperative and the letting agent insisted that all was above board and legal. The secretary communicated our concern that this arrangement was in breach of the zoning, and also contravened as a special by-law we had in place to prohibit short term letting. The letting agent was rude and dismissive and the strata manager basically passed the buck. The other committee members sadly had no stomach for an NCAT challenge (which seemed the only recourse available) and the situation was left unresolved.

After 3 years the corporate lease was terminated and a regular tenancy is now in place. Since the matter was never properly tested it remains unclear as to what the legal standing is regarding this type of arrangement. Given the current manufactured ‘confusion’ regarding short term letting – where people seem to be putting about fake news that ‘it’s all legal now anyway’ – I suspect this type of irregular letting will proliferate until a clear legal precedent is set. I take some hope from the recent post by Jimmy T regarding higher court judgements but there always seems to be a louder argument from the other side.

I realise my post does not really provide you with a plan to defeat the problem, except to say that the registering of a by-law prohibiting a lease under 3 months (or even 6 months) has certainly helped us in regard to other instances of short term letting in our block. However, it is this corporate work-around tactic that seems to be the grey zone. Who knows how things might pan out now if a number of residents decide to flout the by-law given the current manufactured ‘confusion’?

Regards,
Braveheart

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Tess McGill
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12/10/2018 - 12:37 pm
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Curly one. My response would be to aim low. Target the “tenant” on the breaches of the bylaws committed by the individuals. Amend your bylaws if necessary to impose fines for disturbances, littering etc. After a while they might get tired of constantly being “pinged”.

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JimmyT
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12/10/2018 - 1:03 pm
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Tess McGill said
Curly one. My response would be to aim low. Target the “tenant” on the breaches of the bylaws committed by the individuals. Amend your bylaws if necessary to impose fines for disturbances, littering etc. After a while they might get tired of constantly being “pinged”.  

I think part of the problem is that the tenants are transient and the corporate “landlords” don’t care.  Like so many arrogant non-residents (such as commercial operators taking up visitor parking for their own use) they find a grey area and exploit it, treating residents with contempt. 

So the answer is to make them care.  Every time a new “visitor” takes up residence, the corporation should get a notice saying they are being pursued under section 258 of the Act (below) which says that all new leases or sub-leases must be notified to the Owners Corporation.

If they refuse, cancel their keys. If they complain, say there were strangers in the building but no one knew who they were.  And take them to Fair Trading with a view to having them fined at NCAT (maximum of $550 a pop). And ping them on your no-short-term-letting laws. In other words, harrass the crap out of the company.

And if that doesn’t work, shine a torch with the shadow of a key on to a cloud and Captain GlueGun will come around …

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.

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