September 23, 2019

BY BY ALEX MARTIN AND PAUL SANCHEZ

The proliferation of vacation rental operators in Miami-Dade County’s popular tourist destinations has been making headlines lately. The ongoing battle against illegal short-term rentals that are in clear violation of condominium association regulations is playing out in high-rise communities along Miami Beach and throughout the downtown corridor.

The result is a tremendous problem that impacts both visitors and, even more profoundly, condominium owners. As the situation grows, associations are forced to find ways to police the problem, often with inadequate expertise and resources at their disposal.

It is understandable how Airbnb, VRBO, HomeAway and other vacation rental sites have grown in popularity among visitors to Miami. Whether they’re coming for major events like Ultra Music Festival and Art Basel, or, simply seeking to escape the winter chill for some South Florida sunshine, the ease and affordable rates of vacation sharing makes it an attractive option. Unfortunately, these travelers are often blissfully unaware that many associations governing Miami’s condominium towers specifically prohibit short-term rentals in their charters. Just imagine arriving at your long-awaited beach escape only to be turned away at the gate by security. Now what?

The problem is even more alarming for condominium owners. When residents or tenants participate in any of these vacation sharing services, it puts the entire building at risk. There are critical concerns that come with “strangers” suddenly showing up at the community you call home with the intention of using it as their vacation hot spot. It might be public intoxication by the pool, music blaring late into the night, misuse of building amenities, unsafe behavior, unauthorized parties – and more.

Beyond these lifestyle and safety concerns, owners face serious financial repercussions should their building become known for allowing short-term rentals. It might become more difficult to refinance a unit or obtain lines of credit. Resale values – and the ability to sell units in general – take a major hit. After all, Realtors are inclined to steer prospective buyers away from buildings that have the reputation of a frat house. Make no mistake, short-term rentals can tarnish a community’s reputation and negatively impact property values.

To avoid such instances, condo associations are retaining legal counsel to review or amend their bylaws to ensure the illegality of short-term rentals is explicitly detailed and expressly addressed. They are also counting on reliable association management companies to step in and police violations. Their property managers and building staff, along with association members, become de facto detectives that root out violators and initiate the proper resolutions. Policing measures might include:

• Aggressive monitoring. Management teams monitor short-term rental websites, looking for advertisements with images that show unique tiling, balcony railings or views specific to their building.
• Staff training. Run through scenarios with staffers so they can identify key signs of violations. These might include the aforementioned visitors with suitcases, or groups walking around aimlessly because they are unfamiliar with the building. It is also important to ensure anyone who enters the lobby is asked who they intend to visit.
• Legal action. A strongly worded cease and desist letter can have a chilling effect. For operators who turn to these rental platforms to grind out a profit or cover expenses, the threat of legal action, requiring costly counsel, could be enough to get them to stop or take their short-term renting elsewhere.
• Reputation repair. Publicize successful efforts to eliminate short-term renting to the point that your building becomes known for being particularly unfriendly to Airbnb and its peers.

One condo community we oversee in Greater Downtown Miami had a major problem with short-term rental violations. Numerous units were violating association rules. However, through a combination of monitoring and training, nearly all violations were eliminated in just a few months.

As long as Miami Beach, Brickell and downtown Miami remain internationally known destinations, the sharing economy will be prevalent. But there is some good news. Developers, recognizing the demand for short-term rentals, are specifically tailoring new projects for such uses in neighborhoods where they are allowed. This, combined with the continued efforts of municipalities and associations to get rid of illegal short-term rentals, bodes well for a future where no visitors find themselves stranded with their suitcases and a ruined vacation.