Q: Short-term rentals are becoming a big problem in our condominium association, especially during the holidays and summer, where leases may be for a week or less. Short-term tenants rarely follow the rules if they even happen to know about them in the first place, damage to the common elements is on the increase and we have no idea who is doing it, not to mention our property manager who is pulling her hair out and probably ready to quit. What can we do?

A: I am assuming that your governing documents contain no restrictions on short-term leasing. Most other condominium Bylaws will contain a restriction which states that leases have to contain a minimum initial term such as 30 days, 6 months or a year.

Hopefully, the practice of short-term leasing is not so pervasive as to involve co-owners holding more than 1/3 of the voting power, who could be expected to oppose an amendment adding a restriction on short-term rentals. Since this would be an amendment regarding leasing, in addition to 2/3 of the members, you would also have to get 2/3 of the voting power of “mortgagees” (basically, the banks that provide mortgages on the units) to approve, but that tends to be an easy process with the guidance of an experienced condominium law firm.

While some co-owners may wish to go even further and prohibit all leasing, that may not be considered a reasonable restriction by the courts, even if you were to exempt current co-owners. But it would likely be acceptable to place a certain percentage cap on leased units with an exemption for current co-owners, perhaps somewhere between 20 to 30 percent of all units, which is a common restriction in governing documents. This could be an additional proposed amendment.

Finally, note that you will also have to ensure that the new provisions have teeth. If the penalties for default under that provision or pursuant to your enforcement policy are not tough enough, the short-term lessors may decide that the penalties are an acceptable cost of doing business. Additionally, you need to ensure that your association will be able to recover the costs related to enforcement of the provision. An experienced condominium attorney would be sure to review your enforcement provisions and draft any additional proposed amendments to same that may be needed.

Robert M. Meisner is the Principal Attorney of The Meisner Law Group, based in Bingham Farms, Michigan, which provides legal representation for condominiums, homeowner associations, individual co-owners and developers throughout Michigan, including Grand Traverse, Leelanau, and Emmet Counties. His book, Condo Living 2: The Authoritative Guide to Buying, Owning and Selling a Condominium is available at www.momentumbooks.com. He can be reached at 800-470-4433 or bmeisner@meisner-law.com. Visit the firm’s blog at www.meisner-law.com/blog.

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