Legal firm Wright Rose Innes recently dealt with the issue of running an Airbnb from a sectional title unit.
The firm said that a number of sectional title owners are usually investors in the property market and purchased a unit for the sole purpose of renting it out and thus earning an income from the unit, usually in the form of long-term rentals.
It added that platforms such as Airbnb allow owners to advertise your furnished property or even just a room in your property, to any person to stay for a short time, allowing them to generate some handy additional income from that unused spare room.
Although this is a wonderful opportunity, sectional title owners must be careful, the firm warned.
“Remember that each owner of a unit in a sectional title scheme becomes a member of the body corporate the moment they become an owner of a sectional title unit and gain an undivided share in the common property. ”
Your unit is thus part of a mini-community within the larger general community.
“The body corporate stays the owner of the common property in undivided shares and the interest of the members of this smaller community must always be considered when doing something in the sectional title scheme.”
Following the rules
To manage a sectional title scheme successfully, Wright Rose Innes said that community scheme must have rules in place to govern the action of owners, tenants and visitors in the scheme, and the body corporate has at its core functions the duty to ensure compliance with any law relating to the common property and to enforce the management and conduct rules of the scheme.
These rules must be reasonable and apply equally to all owner, it said.
In terms of the regulations to the Sectional Titles Schemes Management Act, the body corporate must make sure that a unit is not used in a manner as to unreasonably interfere with other persons lawfully on the premises.
The body corporate can, however, amend the rules of the scheme as long as it is approved by the Community Scheme Ombud Service, and from date of approval it will be valid and binding on all residents.
“Owners utilising their unit as an Airbnb must consider the risk involved with short term leases to other residents on the premises,” Wright Rose Innes said.
“These risks can include, security risks due to the high volume of unknown persons coming and going, potential immoral use of units, difficulty in enforcing the requirement that the rules of the scheme must be provided to every tenant, extra insurance if a unit is used for commercial purposes, lack of adherence to scheme rules by short term tenants, general nuisance and potential damage to common property to other tenants and more. ”
It added that South Africa’s courts recently had to consider this question and came to the conclusion that unless the management or conduct rules of the scheme provides for a minimum time for which a lease agreement may be concluded, for example not shorter than six months, or any other reasonable condition which owners and tenants must comply with, you as the owner may rent your unit for shorter terms.
“This makes it clear that it is possible for you to use your unit as an Airbnb, but should the body corporate amend the rules by way of resolution of its members and those rules are approved by the Community Scheme Ombud Services, you must adhere to the rules and cannot use your scheme for Airbnb or any short-term lease.
“Even if your scheme does not have such rules and you do use your unit as an Airbnb, ensure that you adhere to the rules of the scheme and require your tenants to also adhere and take proactive steps to consider the other owners living in the scheme and “approach the body corporate first before proceeding blindly to utilise your unit for short term leases,” it said.