The Melbourne Supreme Court recently ruled that owners’ corporations could not pass by-laws banning short-stay lets, such as through Airbnb, in apartment buildings.
While by-laws can be passed controlling what people do with their units, the NSW Civil Administration Tribunal (NCAT) can overturn them if just one owner objects.
A case study in the NCAT website gives an example: An owners corp had passed a by-law banning short-term lets, one owner wanted to run them and an NCAT adjudicator decided the by-law was unreasonable and scrubbed it.
So, can we pass by-laws banning short-stay lets? Some say yes, but only if the zoning is residential only. Others say no, but you can put restrictions in place that make short-stay lets impossible.
However, the fundamental problem, according to leading strata lawyer Stephen Goddard, is one clause in strata law that that says by-laws can’t interfere with “dealing” with lot properties, including buying, selling or renting them.
In sum, all it takes is one investor and an adjudicator who thinks the ‘rights’ of an individual count for more than the needs of a community, and it’s bye-bye by-law.
Source: Jimmy Thomson’s article available at: http://www.flat-chat.com.au/short-stay-bans-overturn-ncat/