Courts across the country have been hearing cases about short-term rentals of homes and condominium units, and there is not much consistency in the decisions made. Sometimes, it is the homeowners’ association that is trying to enforce its covenants in a manner that prohibits short-term rentals, and sometimes it is a municipality trying to enforce its zoning ordinances.  In the two cases discussed below, we have one of each—and in both cases, the language of the covenant and the ordinance made all the difference.
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A Court in Louisiana recently tackled the issue of short-term rentals (New Jax Condominium Association, Inc. v. Vanderbilt New Orleans, LLC, 219 So.3d 471). A Condominium Association adopted an amendment to its bylaws during its annual meeting prohibiting short term rentals. When a Unit Owner continued to engage in short-term rentals, the Association sued and received a permanent injunction, preventing the Unit Owner from continuing to engage in short-term rentals. The Unit Owner appealed, alleging that the amendment to the bylaws was invalid because certain board members had conflicts of interest, and because one board member changed his vote during the voting.
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Those of us involved in condominium management, whether as board members, officers, property managers or attorneys, know that VRBO and AirBnB have changed the way units are rented. Short term rentals are viewed by many associations as a problem that should be solved.  Specifically, these associations and managers would prefer that short rentals (most often defined as less than six months or one year, but I have seen it defined as less than 30 days) be prohibited.  The problem is getting enough people to agree on the various issues:
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If you are seeing a lot of unfamiliar faces coming and going from a unit in your Association, it is possible that the owner is renting his unit on a short term basis. The Short Term Rental (“STR”) market is thriving worldwide, through such well-known websites as AirBnB and Vacation Rental By Owner (VRBO) to name a couple. But what does this mean for your Association and how do you deal with it?

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