As we start the New Year and the 2017 legislative session, community associations should be reviewing their current rental provisions and deciding whether to propose any amendments to address minimum rental terms. If your association has a problem with short term rentals in the community and would like to adopt amendments to the governing documents to address those issues, the amendment should be approved and recorded as soon as possible. For example, some governing documents require rentals to be for a minimum of 6 months, or 12 months, so that the residential nature of the community may be maintained. The documents could also be amended to clarify that the listing of a property in the community on a hotel-lodging type site constitutes a violation in addition to the short-term occupancy being the violation.
Why are we recommending this? Because while a bill has not yet been filed, we expect to see a bill that would change the law to limit the ability of homeowners’ associations (HOAs) to adopt amendments that prohibit rentals, alter the duration of the rental term, or limit the number of time unit owners are entitled to rent their units. This is already the law for condominium associations, and there is support to extend it to HOAs. There were a number of bills with this language that were filed during last year’s legislative session, but they did not pass. We expect to see similar bills filed again this year. As you can probably imagine, the special interests behind such bills are companies like AirBnb, VRBO, and investors who want the unrestricted ability to rent homes in residential communities.
In addition, there has been a bill filed, SB 188, that would prohibit local governments from adopting ordinances limiting the duration of vacation rentals. This bill would primarily impact community associations without minimum lease terms, as it will limit the ability of your local government to offer your association much help.
For more information about the 2017 legislative session, please visit the CALL website, www.callbp.com. We have posted a spreadsheet of the bills that have been filed so far for the 2017 legislative session that impact community associations.