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Owners corp's options re Airbnb
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shadow
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30/05/2017 - 8:01 am
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Need some advise. Living in complex of six units, one of which is rented. The Renter is doing air b&b with owners knowledge. Obviously costs such as water and maintenance increases, but all pay equally for these. Totally unfair. Told body corporate can’t assist so we wish to add a clause into body corporate at next AGM to place penalty on units involved in such activities, whereby they have to pay higher quarterly fees. Can this be done any ideas or indeed samples where has been done.

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Sir Humphrey
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30/05/2017 - 12:34 pm
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I can see that water might increase but not much else on maintenance. With only 6 units, could the OC resolve to install individual water metering? Even without considering one unit being rented, some units might be frugal with water and others profligate. 

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JimmyT
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31/05/2017 - 9:06 am
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Sir H is right.  Pass a bylaw that any unit being used for short stay rentals must be fitted with a separate water meter at the owner’s expense.

Meanwhile, as advised by the Fair Trading Commissioner, start hitting them with penalty notices for every time there is a new tenant and that tenant’s name and address are not registered with the owners corp as per section 258 of the Act (see below).

That’s a potential $500 fine for every breach that goes straight into owners corp coffers.

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.

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Sir Humphrey
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31/05/2017 - 10:56 am
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JimmyT said
Sir H is right.  Pass a bylaw that any unit being used for short stay rentals must be fitted with a separate water meter at the owner’s expense…  

I would still suggest a separate water meter for all units. There is a good chance of it passing since usually everyone thinks that everyone else is using more than their fair share of any resource. 

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Lotsofstairs
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21/06/2017 - 3:11 pm
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JimmyT said

Meanwhile, as advised by the Fair Trading Commissioner, start hitting them with penalty notices for every time there is a new tenant and that tenant’s name and address are not registered with the owners corp as per section 258 of the Act (see below).

Hi Jimmy

Do you have a link to the Fair Trading Commissioner advice please?

Plus does this advice apply to situations where a bedroom is let out and there is evidence the premises are advertised on say the AirBnB website?

Thanks

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Lady Penelope
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21/06/2017 - 5:10 pm
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I dislike being the bearer of bad news but it is my understanding that SSMA 2015 [s258] will not assist in ending short term holiday accommodation in NSW strata as it does not apply to this situation.

I have based my opinion on the following commentary from the NSW Office of Fair Trading at

https://www.fairtrading.nsw.gov.au/ftw/Consumers/Buying_services/Travel/Holiday_home_rentals.page

wherein it states:

To avoid coming under the general tenancy laws of NSW the property must ordinarily be used for holiday purposes or if not, rented for periods of no more than 3 months for the purpose of a holiday.

And further commentary from the NSW Office of Fair Trading states that:

Individuals are quite at liberty to rent out their holiday properties.

https://www.fairtrading.nsw.gov.au/ftw//Consumers/Buying_services/Travel/Renting_a_holiday_home.page?

If a person is renting a premises for less than 3 months and for a holiday, then a residential tenancy agreement should not be used.

The Residential Tenancies Act 2010 does not cover agreements giving the right to occupy residential premises for no more than 3 months for a holiday. The term “tenancy notice” in [s258] only applies to leases formed under Residential Tenancies Act 2010.

If there is no tenancy agreement (as defined by the Residential Tenancies Act 2010) then short stay accommodation will not be caught by SSMA 2105 [s258].

https://www.tenants.org.au/factsheet-01-residential-tenancies-act

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JimmyT
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21/06/2017 - 5:26 pm
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Lotsofstairs said
Do you have a link to the Fair Trading Commissioner advice please? 
Plus does this advice apply to situations where a bedroom is let out and there is evidence the premises are advertised on say the AirBnB website?

The following is an extract from (then) Fair Trading Commissioner Rod Stowe’s letter to a Flat Chat reader and prominent strata committee member.

The reforms to the strata laws in the Strata Schemes Management Act 2015 (the Act), which commenced on 30 November 2016, will make it easier for owners corporations to enforce by-laws and increase penalties for non-compliance. New model by-laws can address issues that may arise from short-term letting.

Schedule 3 of the Strata Schemes Management Regulation 2016, which contains the model by-laws, provides examples relating to noise, vehicles, obstruction of common property, damage, and the behaviour of owners and occupiers, among others.

Owners corporations can examine their by-laws with these examples in mind. The Act also provides a number of provisions which may be of assistance to strata schemes facing problems regarding
short-term letting.

For example, model by-law 17 in Schedule 3 requires an occupier of a lot to notify the owners corporation of any change to the use of their lot for short-term or holiday letting. The notice would have to be given in writing at least 21 days before the change occurs or a lease or sub-lease commences. Such a by-law would provide an owners corporation with enough notice of short-term letting so arrangements could be made on matters such as safety and security.

Section 82 of the Act also allows a lot owner to consent to paying a larger individual contribution if the way their lot is put to use would adversely affect the insurance premiums to be paid by a strata scheme. The NSW Civil and Administrative Tribunal may make such an order if it is of the view that the owner’s agreement to such an increase has been unreasonably refused. It may be that short-term holiday letting in a scheme may have an adverse effect on the insurance premiums that would be payable. This is a matter for the owners corporation to determine.

Section 137 of the Act allows an owners corporation to pass a by-law restricting the occupancy of designated bedrooms in a lot to no more than two adults. The section contains safeguards to protect large families and temporary visitors. A by-law of this type may assist owners corporations in controlling overcrowding, which may be a problem with short-term holiday letting.

Section 153 of the Act places an onus on owners and occupiers of lots in a scheme, among others, to not create a nuisance or hazard, either in the lot, or on the common property.

This section also prohibits persons from using the common property in a manner that interferes unreasonably with the use or enjoyment of any other lot by the occupier of the lot (whether that person is an owner or not) or by any other person entitled to the use and enjoyment of the lot. This provision may be of use to owners corporations regarding the conduct of persons who may be short-term letting in their scheme.
 

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