Over the course of the past several years, our economy has undergone an interesting shift, moving away from one based on sole ownership towards one centered around the maxim of sharing. From cars to clothes to cats (yes, even cats!), the sharing economy is shaking things up all over – and nowhere is this more apparent than within the condo industry. All it takes is one look around a city like Edmonton to find no shortage of short-term condo rentals, eager to host folks during their stay in the City of Champions for anywhere from a few days to a few months.
As services like Airbnb continue to grow in popularity, it’s important for your condo board to have a plan of attack when it comes to addressing the questions, queries, and concerns around short-term rentals. When it comes down to it, there are really three distinct options to explore regarding how to approach the burgeoning sharing economy and your condo building – which, wouldn’t you know it, is just what this blog happens to be about!
While some people view short-term rentals as a new, exciting opportunity, others see these tenancies as nothing but trouble – and, in some instances, they’re right. We’ve all heard horror stories of Airbnb rentals gone wrong, resulting in thousands of dollars of property damage, sullied building reputations, and sometimes even injury or death, often due in large part to the lack of concern individuals have for the home they’re staying in because, hey, they don’t really live there, so what does it matter?
While these sorts of extreme situations are most certainly the exception rather than the rule, that hasn’t stopped some condo boards from outright banning short-term rentals within their buildings in an effort to nip these sorts of circumstances in the bud. While this might save the building from having to deal with any potential headaches related to short-term rental mishaps, it’s a policy that creates more than a few headaches of its own – namely, by deterring incoming homeowners from moving into a building that restricts what they can do with their property, even coming off as backwards-thinking in the face of an industry’s changing landscape. Sure, these policies help avoid the issues associated with short-term rentals – but that peace of mind definitely comes at a steep cost.
While some buildings ban short-term rentals outright, there are other condo complexes that operate on the far opposite end of the spectrum and simply employ a free-for-all principle, allowing condo owners to do whatever the heck they want when it comes to short-term rentals and stepping back for a completely hands-off approach. While this might seem like a great alternative to other condo boards around Edmonton that might prohibit short-term rentals altogether, we can’t say that we recommend this approach, either.
By ignoring short-term rentals and allowing unit owners to do absolutely whatever they like in this regard, both the building and surrounding property are being put at substantial risk through negligence and lack of proper oversight. The security that tenants expect and appreciate when living in a condo complex is completely undermined as short-term renters come and go, leaving your building feeling less like a home and more like a revolving door. Further, in the event of any incidents, the lack of any rules or bylaws means that your board will be left without a leg to stand on when it comes to addressing any problems or issues that might come up.
So, if banning short-term rentals isn’t the way to go and ignoring them isn’t advised, what’s left?
As with most condo-related quandaries, it’s once again the even-keeled approach that we find ourselves standing behind. Ignoring short-term rentals is a recipe for trouble, while banning them outright is only so effective of a solution, which is why we like to emphasize coming up with an answer that walks the middle road. The best way to go about this is to reach out to Airbnb owners and ask them what they need, incorporating them into the process and building a mutual respect so that rather than having to police individuals looking to rent their units out, these tenants will instead be glad to comply with any rules and regulations that are put into place for the good of building.
For their part, Airbnb is working on coming up with solutions to make short-term rentals in condo complexes more palatable for boards and condo communities alike, beginning by starting to offer condo boards a percentage of rental fees earned to cover wear and tear on buildings and common areas, which is definitely a step in the right direction.
In addition to creating a happier, more functional condo community, this approach also has the potential to pay dividends when it comes to the profitability of the building, too. New condos are launching all over Edmonton that offer reasonable guidelines when it comes to short-term rental opportunities and are experiencing huge amounts of initial unit sales as a result. People are eager to take advantage of the growing sharing economy, and by facilitating these opportunities, your condo board is positioning your building for forward-thinking growth and success, which is surely something everyone can get behind!
Short-term rentals and the sharing economy are changing what it means to be a condo owner, but in our minds, the benefits and success stories far outweigh the potential risks that come along with this new approach to tenancy. If you have questions about how to approach short-term rentals in your building, learn from other condo owners’ experiences at Alberta Condo Owners for Change, or reach out to us today at Catalyst Condo Management, and we’ll be happy to you sort out a solution that will work for your condo community.