Is Short-Term Letting Causing Your Building Financial or Security Headaches? | Owners Corporation Network

Is Short-Term Letting Causing Your Building Financial or Security Headaches?

The explosion of short term listings across the world’s tourist cities and towns raises many important questions for residential strata owners and residents, who can be severely impacted, as well as the community at large, which suffers the loss of rental accommodation.

 

Life Safety Risks

Buildings approved for short term stays have more rigorous fire standards, including emergency exit maps and exit signs, to assist people unfamiliar with the building escape in an emergency. Overcrowding, which often happens with short term lets, poses a further danger to occupants.  Will these extra people overload fire escapes, potentiallly leading to injury and/or death if people need to evacuate in case of emergency?

Financial Risks

The financial cost of the increased wear and tear is borne by all owners.  One Sydney building commissioned reports on the impacts, and tracked the annual savings after removing all short-term lets (205 of 384 apartments at the peak).  The life of the lifts was reduced 20% - at a current replacement cost of $500,000.  Water and electricity usage and costs dropped dramatically when short-term letting was stopped.  The building saved $1.3m over 3 years, while reducing levies 5% per year in each of those 3 years.

Few strata owners realise that all owners are jointly and severally liable for costs and/or debts incurred.  What if your building insurance does not cover a claim if a short stay guest is injured or worse?

Cost to Building Residents

Then there's the anti-social behaviour, the noise, the lack of respect for the building and residents, and the illegal activities that often follow.  How will you react when someone knocks on your door, looking for a "massage" late at night?

Cost to the Community

The significant loss of residential accommodation to short term stays has been proven overseas to result in evictions and higher rents for properties still available.  Cities around the world are identifying growing affordability problems for local residents.  Read more at http://insideairbnb.com/about.html

 

The people who provide the answers to these questions through bitter experience

may not be so blasé about the appeal of short term rentals

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