Due to the rapid rise in popularity of Airbnb and the “sharing economy”, the current legislative and regulatory framework has not yet been updated to deal with the issues caused by short term online renting services.
Existing legal position
The existing legal position in relation to Airbnb is that a Body Corporate is very limited in what it can do to regulate lots participating in Airbnb. Essentially, the Body Corporate and Community Management Act 1997 (BCCM Act) provides that “if a lot may be lawfully used for residential purposes, the by-laws can not restrict the type of residential use.”
This is the starting point when considering the legal position of a Body Corporate in relation to Airbnb. Given a Body Corporate has no right to create a by-law which restricts owners of residential lots from carrying on certain types of residential use inside their lot, it is not able to create a by-law which prohibits lots being used for Airbnb rentals.
If a Body Corporate cannot control the type of residential use a lot is put to, is there any authority that can?
Yes, there is. The local government can enforce local government planning rules and the development approval for the Scheme. However, most development approvals do not restrict the type of short term use for which a lot can be used. If the Body Corporate or lot owners think that the use of Airbnb by other lot owners in their Scheme might breach the development approval then lot owners can complain to their local government and ask them to enforce the development approval. The Body Corporate cannot enforce the development approval for the Scheme, only the local government can do that. As an aside, in relation to building classification type arguments, it has been demonstrated that there is nothing in the residential building classes which would prevent lots being used for short term, Airbnb type uses.
Aside from “use” based arguments, what else can a Body Corporate do about Airbnb?
Basically, the Body Corporate is required to monitor:
• The administration, management and control of common property and body corporate assets; and
• Conduct that interferes “unreasonably” with others in the Scheme, which is normally enforced via the nuisance by-law (but which has its origins in section 167 of the BCCM Act).
If an occupier, including a user of Airbnb is, by their conduct, interfering unreasonably with the use or enjoyment of other lots or common property in the Scheme then (provided there is sufficient evidence in relation to the breach) the by-law contravention process prescribed by the BCCM Act should be followed.
• The law has not caught up with Airbnb and similar type uses of residential lots in community titles schemes
• Body Corporates cannot restrict the type of residential use to which a residential lot is put by the lot owner
• Body Corporates and lot owners might consider the following alternatives to “use” based arguments:
– Whether the conduct of short term occupiers of a lot is interfering unreasonably with the use and enjoyment of other lot owners in relation to lots or common property and taking action via the by-law enforcement process in the BCCM Act
– Making a complaint to their local government if they think the development approval for the Scheme is being breached by the use of the lot for Airbnb purposes.
This document has been prepared for information purposes only and is current as at 16 August 2017. Devenish Law will not be responsible for any loss arising from use of this document if it is used other than for the general information of the reader. Individual, tailored legal advice should be sought on a case by case basis. Please telephone Shane Devenish on 07 4081 7111 if you require legal advice in relation to management rights and body corporate issues.