Renting out your condo on Airbnb might seem like a great way to make some extra money. But before you jump on the opportunity, it’s wise to check your condo association bylaws.
In most cases, you’ll find that the bylaws include restrictions on “leasing.” For example, the rules might state that no unit can be rented for less than 6 or 12 months at a time, or they might state that a unit can’t be used as a hotel.
These provisions exist because the Federal Housing Administration, which is the biggest mortgage lender nationwide, places restrictions on the number of renters a condo complex can have. Generally, the rule is that no more than 50 percent of tenants in any complex can be renters, except in particular cases where it’s 35 percent.
Another problem is that the security of the building could be compromised if you’re giving keys to lots of Airbnb customers and allowing them free rein to go in and out.
Due to these concerns, some condo boards are cracking down to deter owners from renting out their units. Some penalize owners by fining them, and others have created rules that require an owner to pay the association the entire sum received from the Airbnb rental.
Before a fine is assessed, the owner typically has an opportunity to present his or her case at an informal hearing and request that the fine be removed or reduced. But if a fine isn’t paid within a reasonable time, the owner can be sued or the unit could be foreclosed on due to the lack of payment.