SHORT TERM LETTING AND AIR Bn’B
How to deal with the plague
This article relates to the situation in the City of Cape Town municipal area and to municipal areas with similar regulations.
Many bodies corporate have conduct rules in place which prohibit the use of sections for the purpose of short term rentals, i.e. for periods shorter than two or three months, without the approval of the trustees. The Ombud Service is currently allowing such rules.
It has been argued that a conduct rule prohibiting short term rentals infringes upon the proprietary rights of owners who have purchased their sections for investment purposes and that any prohibition must preferably be contained in the management rules to be binding. To incorporate such prohibition in the management rules of a body corporate requires the approval of all the members by unanimous resolution – not an easy thing to achieve.
But consider that a conduct rule which provides for compliance with strict requirements to enable an owner to let his section on short term will serve to protect the rights and interests of long term owners and residents. How must these opposing interests be weighed up against each other?
Problems experienced as a result of short term letting and transient residents include:-
Owners who are letting their sections (irrespective of the duration of the lease) are obliged in terms of Section 13(1)(f) of the Management Act, to notify the body corporate of a change in occupancy of their section, and the trustees are obliged in terms of prescribed Management Rule 27(2) to keep record of the personal details and contact details of the tenants of all the sections in a scheme. I doubt whether this happens in practice, particularly in respect of short term tenants.
Owners of sections zoned with a residential zoning and situated within the jurisdiction of the City of Cape Town who are using their sections for the purpose of short term rentals on AirBnB or otherwise, must note that it is likely that they must first submit an application to the City of Cape Town for approval of a temporary land use departure in terms of the Municipal Planning By-law, 2015 to authorise such usage. Owners who are using their sections for short term rentals without the necessary approval of the City of Cape Town may be found guilty of a land use contravention. To ascertain your primary use rights relating to your section, a zoning scheme extract and map may be obtained from the City of Cape Town and one would be able to consult with one of their professional officers.
It is also prudent for trustees to obtain the necessary zoning certificate and information from the City of Cape Town or from the other local municipality concerned.
There can be no doubt that the recent increase of short-term letting is causing major problems for management and it is hoped that when the issue is considered in our courts, as it inevitably will, outcomes will favour the majority of owners and residents.
Download MCS Courier November 2018 to continue reading - Why must bodies corporate rectify defective drafting; and some more criticism of the prescribed Management Rules.