Condo Corporation Enters into Agreement with Airbnb to Regulate Short-Term Rentals

A downtown Toronto condominium is the first condominium corporation in Canada to enter into an agreement with Airbnb to regulate short-term rentals.

The agreement contains a number of provisions that benefit the corporation:

• the corporation will be provided with information about which units are being rented through Airbnb, the dates that guests check in and out and the number of guests.;
• all guests will be required to provide government-issued ID to Airbnb;
• Airbnb’s property and liability insurance will be extended to cover the corporation and the common elements;
• the corporation will receive a portion of the revenue from the rentals to compensate for the increased wear and tear on the common elements and increased security costs resulting from short-term rentals;
• Airbnb will refuse to allow hosts to use its booking platform if there are too many complaints (e.g. nuisance, noise) generating from the rentals.

The corporation had tried to amend its declaration to prohibit short-term rentals, but was unable to obtain the necessary 80% owner approval to do so. As the declaration permitted short-term rentals the corporation was unable to stop them. Without this agreement the corporation had no effective way to regulate short-term rentals on the condominium property. It had no control over the strangers coming and going from the property and didn’t know who they were.

This agreement is part of Airbnb’s Friendly Buildings program which was launched in the U.S.  a couple of years ago. Agreements of this nature benefit Airbnb as it helps quell opposition to the use of its platform in condominiums and efforts by condominium corporations to oust Airbnb rentals. It also provides hosts with an incentive to use Airbnb rather than other rental platforms, as there will be less hassles for hosts knowing that the condominium corporation is on-side.

Entering into an agreement of this nature makes sense for condominiums whose declarations permit short-term rentals and where the Board has determined that the owners overwhelmingly favour short-term rentals and do not want to amend the declaration.  However, it is not an option for condominiums whose declarations prohibit short-term rentals as the Board has a statutory duty to enforce the declaration.

Click here to download our Short Term Rental guide for Directors.