Tag Archives: rent

DEALING WITH RENTERS

You can place restrictions on renting units, but you might want to try some other strategies first.

When community associations start discussing what they should do about renters, it is often because of a horror story. In the last several years, I have helped associations deal with renters whose alleged activities have included loud parties; fights and disturbances; child abuse; strange people coming and going at all hours of the day and night; drug dealing; prostitution (both male and female); car break-ins and apartment burglaries; vandalism and other abuses of property; harassment and assault of managers, board members, owners, and other tenants; and every other conceivable social ill. While these kinds of activities sometimes involve owners, usually the perception is that renters are problems.

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What You Must Know Before Renting Out Homeowner Association Facilities

 

Many associations are considering a range of revenue-generating measures to offset ever-tightening budgets. But before you rent out your clubhouse or sell memberships to your golf course, pool, tennis courts, or other facilities to non-owners, keep a few critical rules in mind.

1) Consider the liability. The biggest issue that keeps associations from renting out their facilities to non-owners is liability. Check with your insurance carrier to find out if injuries to non-owners and injuries caused by non-owners would be covered under your current policy. Chances are they won’t, and it’ll be much more expensive to expand your policy to include that coverage. Once you know the additional insurance costs, you need to weigh them against the potential new revenue to determine whether the financial gain adequately offsets the added cost.

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Leasing & You

Many lawsuits challenging community associations’ efforts to enact or enforce rental restrictions don’t do very well in court. In fact, courts have usually upheld such lease restrictions – including limits on lease terms, occupancy and usage as well as outright bans.

The problems usually arise when governing documents are amended and owners find they can no longer rent their units, or can’t rent them for fewer than 12 months or rent them to five co-eds. To the uninformed owner caught short by a covenant amendment, the prevailing opinion is that, when you bought the home, your governing documents permitted such changes. In other words, owners should know that documents – and the activities they allow – can change.

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