SA Property - Short-term Sectional Title Letting
By Graham Paddock
Sectional title owners are entitled, as of right, to let their properties for any period, subject to the relevant laws, by-laws, title deed conditions and the scheme’s registered or approved rules. Nothing in the Sectional Titles Schemes Management Act (“the Act”) or its prescribed rules defines or regulates short-term letting. Occupation of a unit by a short-term residential tenant does not imply that the unit is being used as a hotel or guest house, or for any commercial purposes in breach of its General Residential zoning under the relevant town planning scheme.
Many published articles have expressed the view that short-term letting gives rise to a range of serious problems in sectional title schemes. Short-stay tenants are considered primarily responsible for nuisances such as noisy late-night parties, security breaches and tracking sand into the hallways and elevators, amongst many others. But there does not seem to be any solid evidence that the behaviour of short-term tenants is any worse than that of permanent owner residents and longer-term tenants.
Our case study is an upmarket sectional title scheme on Marine Drive in Bloubergstrand, a favourite location for kite-surfing with the most recognisable view of the mountain over Table Bay. It includes three blocks with over 100 residential units, each offering from one to four bedrooms, as well as a large heated swimming pool and outdoor braai facilities. The majority of the units are available for short-term letting, and a number of investor owners own more than one unit in the scheme. The trustees, under pressure from one owner who opposed short-term letting, arranged for the complex manager and managing agent to keep a record of all complaints submitted over the year of their term as trustees.
Almost 90% of the recorded rule contraventions reported were linked to owner residents and long-term tenants. These related to parking issues, noise, placing items on common property (trailers, bicycles, kite-surfing equipment etc.), hanging wetsuits and laundry over balconies, not waiting for the entrance or exit gates to close before driving off, smoking on common property etc. The only issue that arose specifically in regard to short-term letting was that the scheme’s security guards were being asked to collect and hand out keys to units, show tenants where to park, take them to their unit and assist with their luggage. The trustees addressed these issues with both the security guards and owners of the units or their letting agents, and took steps to ensure that all tenants are given copies of the conduct rules.
The primary solution, in this scheme, has been the installation of small lockboxes in the post boxes of the relevant units. Tenants get the key from the lockboxes by keying in the correct combination. The security guards take all tenant’s details, make sure they have the rules and tell them how to get to their parking place and unit. While a scheme can make special conduct rules to address abuses and nuisances that arise from short-term letting, this has not been necessary to deal with short-term letting at this scheme.
Scheme conduct rules cannot, in our opinion, impose a blanket ban on short-term letting, but they can, when this is appropriate, impose reasonable conditions that will curb and/or penalise short-term letting when this creates a nuisance or interference in breach of the terms of the Act. Section 13(1) of the Act, read with prescribed management rule 30, prohibits tenants (or any other occupiers) from causing a nuisance or interfering with others’ use of the common property.
We suggest that in any scheme in which there are regular and serious complaints about the behaviour of short-term tenants the trustees should conduct their own survey of complaints and then motivate the passing of a special resolution to incorporate appropriate requirements and penalties for any breaches of the rules. If the body corporate cannot achieve the required special resolution, the trustees can approach the Community Schemes Ombud Service for an adjudicator’s order that has the effect of a resolution approving the required rule.
Should you have questions in regard to this article, or require our assistance with the rules of your scheme as set out herein, feel free to contact us on 021 686 3950 or [email protected] for a no-obligation quotation.
Contact: 021 686 3950