In the month or so since the end of the holiday season we have had a number of queries about banning short term letting in sectional title schemes. It seems that, as usual, holiday makers irritated the permanent occupiers in many of the sectional title schemes in holiday destinations around the country. The result is that the resident owners want to make rules prohibiting short term letting.
If one is not an irritated permanent occupier in one of those schemes, I guess one can understand holiday makers not being particularly considerate. They are in a relaxed mood, not too concerned about meal or bedtimes, casual about tracking beach sand into the foyer and how the kids behave, and have no personal or neighbourly relationship with other occupiers. And many are seriously in party mode!
Sectional title schemes being communities, the rights of all owners need to be considered. That means the investor owners as well as the permanent residents. The resident owners have the right to enjoy their property without undue disturbance. Additionally, the resident owners are concerned with such long term aspects as the appearance of the scheme and maintaining adequate security, both things much less likely to concern holidaymakers staying in the scheme for a week or two.
One of the common law rights of a property owner is to take the fruits of their property. In sectional title schemes, that’s pretty much limited to rental income. One could easily argue that limiting the rental opportunities an owner might have is an infringement of that right of ownership. A limitation of rights needs to be contained in a condition entered on the title deed of the property. Furthermore, in sectional title schemes, rules have to be reasonable and apply equally to all owners of sections put to the same use. We don’t think that a rule preventing short term letting is reasonable, under usual circumstances.
Rather than try to limit rights of ownership, our suggestion is to deal with the real problem, the behaviour of the short term tenants. And that can certainly be achieved by making and enforcing appropriate rules.
Both section 35(4) of the Sectional Titles Act, 95 of 1988 (the Act) and rule 10 of the prescribed conduct rules (annexure 9 to the regulations made under the Act) make the scheme rules binding on occupiers, whether they are owners, long term tenants, or weekenders. Prescribed management rule 69 reiterates the provision and further makes it the duty of owners to ensure their tenants comply with the scheme rules. This lays the foundation for our recommendation on how to deal with inconsiderate short term tenants.
The rules regarding short term lets should be directed at both the owner concerned and the tenant. The rules aimed at the tenants should prohibit specific behaviours, and that will depend on the historical problems with short term letting in the specific scheme: beach sand in the foyer, security gates left open, parking infringements, late noisy parties, and so on.
The rules aimed at the landlord should be to ensure that the tenant is properly briefed on the rules and the landlord’s responsibility to enforce them. There should be provisions for fining the tenant, and perhaps a key/remote control/fine deposit taken before occupation and this should be reflected in the short term lease agreement.
Making conduct rules requires the agreement – in theory at least – of three quarters of the owners of a scheme. If rules regulating short term letting can be made it means a very large majority of the owners buy into the idea and will probably cooperate in their enforcement.
Article reference: Paddocks Press: Volume 10, Issue 1, Page 2.
Anton Kelly is an extremely knowledgeable specialist Sectional Title and HOA teacher and consultant. Having been the lead teacher on all the Paddocks courses for the last 5 years, Anton lives and breathes Sectional Title and HOA law, all day every day. There are not many issues he hasn’t come across before.
This article is published under the Creative Commons Attribution license.
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