Showing posts with label short term. Show all posts
Showing posts with label short term. Show all posts

Wednesday, April 26, 2017

Body Corporates in Queensland can't prevent AirBNB in their buildings

This recent decision confirms previous decisions that a bylaw in a Queensland strata titled scheme that prevents short term rentals, such as AirBNB, is invalid.  Not a great result for apartment residents.
See  Macleay Tower & Villas [2017] QBCCMCmr 12 (17 January 2017)
 http://www.austlii.edu.au/cgi-bin/sinodisp/au/cases/qld/QBCCMCmr/2017/12.html

Monday, December 26, 2016

Short term letting and Airbnb

It appears that in Queensland, it is difficult, if not impossible, to prevent lot owners in a strata titled building from renting their apartments via short term rental services such as Airbnb.

A recent decision of Lynkim Lodge [2016] QBCCMCmr 419 (14 September 2016) supports this.  See decision here.

However, most residential buildings prohibit the use of lots for commercial or business purposes.  When does renting an apartment on Airbnb stop being a residential purpose and become a commercial purpose?

In NSW, there is an action group trying to protect residents of apartment buildings from the dangers of short term rentals.  See NeighboursNotStrangers.  See also here.  They report that apartments in buildings with high short term rentals will drop in value and that there are higher body corporate costs.

Saturday, January 25, 2014

Queensland Coastal Apartments - Capital Losses

RP Data recently issued is "Coastal Housing Markets - December 2013" report.

"Across the Sunshine Coast, median house values are typically most expensive in the Noosa region and most affordable between Caloundra and Maroochydore. Sunshine Beach has the most expensive median house value ($894,733) and Currimundi the most affordable at $400,631.

Median house values across the Gold Coast and Tweed Coast tend to be most expensive at the northern end of the Gold Coast. Across the region, the most expensive houses are found in Surfers Paradise ($962,563) and the most affordable are in Labrador ($392,681)."

Medium value as at September 2013 for apartments:
Noosa Heads - $528,000
Maroochydore - $323,857
Mooloolaba - $358,380
Kings Beach - $367,888
Surfers Paradise - $337,767
Broadbeach - $401,824
Palm Cove - $336,795
Port Douglas - $251,312

Number of apartment sales:
Noosa Heads - 238
Maroochydore - 404
Mooloolaba - 234
Kings Beach - 124
Surfers Paradise - 1068
Broadbeach - 418
Palm Cove - 54
Port Douglas - 270

Change in value over past 5 years
Noosa Heads -  negative 23.3%
Maroochydore - negative 17%
Mooloolaba -  negative 5.2%
Kings Beach - negative 13.7%
Surfers Paradise - negative 15.4%
Broadbeach - negative 10.5%
Palm Cove - negative 21.5%
Port Douglas - negative 13.1%

Wednesday, December 21, 2011

The Oracle - Developer Wins Lawsuits

The developer of The Oracle at Broadbeach was sued by a number of people who purchased apartments off-the-plan and then, after the market dropped, did not want to settle.  The developer won the lawsuits, and the buyers have to pay significant damages to Niecon.

Interestingly, the judge's decision (which is long and complex) discussed issues about when a residential apartment building is and can be operated as a hotel or short stay letting operation.

"The contract provided that any authorisation of a person as a letting agent would be in the terms of the Caretaking and Letting Agreement annexed to the Disclosure Statement. That agreement provided for the entity appointed by the body corporate to operate a letting business, and to use certain common property for specified purposes. The letting business was not limited to long-term tenancies. Nothing in the Caretaking and Letting Agreement provided that the letting agent could not conduct its letting business so as to attract short-term tenants and holiday-makers. The letting business involved associated services commonly rendered in connection with letting lots in similar developments and “any other lawful activity.” This authorised the provision of services to guests occupying apartments, including guests staying for a short time who might require room service, a mini-bar and other “hotel-like services”."

"The fact that [the onsite manager] provides guests with certain “hotel-style services” does not mean that the tower has ceased to be a “residential tower” in the sense earlier described. The fact that some of the occupants are there for a short term does not mean that the tower is not a residential tower. The contractual promise of a lot in a residential tower relates to a tower used for residential purposes. The relevant provision distinguished the residential component from the retail component of the development. In its contractual context, a residential tower does not mean simply a tower for owners who are residents or long-term tenants."

Sunday, December 4, 2011

Short Term Only

Some apartment buildings are built for residents, but are used for short term stays (hotel style accommodation) that causes problems for residents.  Some apartment buildings are only built for short term stays, and are trying to keep out long term tenants and owner occupiers.

"Quest on Story resident Cameron Green said that unless he and the owners of another eight apartments in the inner-city Kangaroo Point building could find the money to fight a legal battle, they would be out on the streets.

The residents bought their homes unaware that under the town plan they could only be used for short-term stays.

In many cases the apartments were advertised as suitable for first home buyers, the new owners received first home buyer's grants and in all cases solicitors carried out all the relevant searches."

Sunday, July 17, 2011

Apartments that are not zoned for residential living

There are a small number of apartment buildings in Brisbane (and on the Sunshine Coast) that are zoned for short term rentals only and where bylaws or the zoning prevent owners from using or renting the apartment for a permanent residences. One is the Quest Story Bridge apartment complex at Kangaroo Point, discussed in this story.
"Unit owner Cameron Green said lawyers carried out standard property searches for him in 2009 but this did not reveal that only short-term occupants were allowed. He said he and other buyers were not made aware when they bought their homes that they could not live in them permanently, due to a development condition imposed on the 14-year-old building. It is understood a building approval search would have revealed the problem but this type of check is generally considered to be “optional” during conveyancing."

Friday, April 22, 2011

NY Short Term Rentals Law

Oaks Group should be happy that they don't do business in NY. A recently enacted law prevents short term rentals of apartments. That seems like a good idea to me. Apart from fire and safety issues, if you buy to live in an apartment building, it is not much fun having people stay next door thinking it is a hotel.

Sunday, October 31, 2010

Risks With Short Term Rental Buildings

When I am looking to buy an apartment in Brisbane, I look at Trip Advisor to see if there are reviews about the apartment building and the onsite manager. As a general rule, if the apartment building is listed with TripAdvisor, I will only buy if I am seeking a non-residental investment. There is limited resale opportunities for short term non-residential buildings.

Example Reviews:

Many reviews highlight the problems -- these buildings were designed for residential apartment living, not as hotels. People ask for adjoining rooms, and don't get them (of course). Items from rooms are stolen. Linen trolleys and food trays are left in hallways, as there are no service cupboards or service rooms for hotel staff. Furniture breaks, as the apartments were furnished for residents, not using hotel quality furniture. No minibars. Parking problems. I wonder what the owners of these apartments think about their real estate agents who are managing their investment -- a real estate agent pretending to be a hotel company.

I love this recent review for Evolution: "What a disaster. We never new accomadation could be so foul .. so many light bulbs broken, Filthy carpets, No drinking glasses (even when you ring & ask a certain staff member who couldn't have been any more passive agressive they still don't come) We changed rooms which was even worse, kitchen tap fell off in our hand, no shower door as it had broken off, huge rip in the lounge, even filthier carpets, rug all ripped, more light bulbs out, TV not tuned so most of the channels hissed at you a lot like most of the staff.. broken light shades, blind pullies broken. When we checked in they held on our credit card $200 for breakages.. there was nothing left TO BREAK!! This place is not rateable unless there is a minus."

Why would anyone want to buy in this building?

Saturday, May 29, 2010

Offsite Letting Agents

In a prior post, I warned against dealing with unlicensed or unusual offsite letting agents for holiday rentals. Recently, Accommodation One on the Gold Coast closed down -- leaving landlords and guests out of pocket. So guests of both Tailly (A1) and Accommodation 1 have recently lost their holiday bookings as well as their prepayments. Booking sites such as RoamFree and eBay should take some responsibility for dealing with these operators and helping them market their accommodation. ebay has set up a compensation fund for guests, but landlords miss out (and now have to find new tenants in competition with all of Accommodation One's other landlords, in a slow winter market.)

Monday, May 3, 2010

Beware of unlicensed offsite operators

The results of the recent Circle on Cavill lawsuit is a warning both to renters and apartment owners who use unlicensed offsite operators.

Tailly leased about 40 apartments in Circle on Cavill from owners, on a long term basis, for example, on one year leases. He then advertised the apartments for rent on the Internet on a short term basis. The Federal Court found that his websites were illegal, and shut them down. Tailly then went into bankruptcy. The apartment owners were not paid rent. The renters and holidaymakers lost their money and had no booking -- Tailly collected the money upfront at the time of booking, and then spent the money. Tailly was not a licensed real estate agent or travel agent -- just a tenant illegally subletting his apartments.

So if you are an apartment owner, make sure that you are using a licensed real estate agent and that you prohibit your tenant from subletting. (In this case, many of the apartment owners used real estate agents that expressly allowed Tailly to sublet!) If you are a renter or holidaymaker, it is best to deal directly with the property or use a reputable website such as Wotif.

If you are getting a too-good-a-deal from eBay, Stayz or a website that is not operated by a real estate agent or travel agent, then watch out! Not all websites are legitimate.

Another example is Paul Whitehead and his company, WorldTourism. Take care when booking with WorldTourism, to make sure you understand who you are booking with. See story on A Current Affair, and these newspaper stories.