Many condo owners make the costly mistake of assuming they can rent out their unit whenever they so choose. This has become an even greater problem since the rise of short-term rental companies like Airbnb and FlipKey.
Unfortunately, what many condo owners don’t realize is that Alberta Law now allows condominium boards to ban residents from renting out a condo short-term. Contact condo management Calgary for the various condo management problems.
Thus, it is critically important that condo owners do their research and understand whether they are permitted to rent their unit—or if there are any applicable condo rental restrictions— before allowing anyone to stay in their home.
5 Things to Know About Short-Term Condo Rentals Before You List
1. You Need a License
In both Edmonton and Calgary, condo owners are required to have a valid business license to rent out a private residence for profit. This is one of the most crucial rules for renting out a condo since any property owner who rents without a license can face fines of $500.00 or more, per instance of non-compliance.
To obtain a license, you must complete a home-based business license form on either the City of Calgary or the City of Edmonton website.
2. Your Condo Board May Require You to Pay a Damage Deposit
There is always a risk involved when renting out a property to strangers. They could cause damages to the unit (stained carpets, holes in walls, etc) or common areas (lobbies, elevators, etc).
Your condominium association has the right to request a damage deposit to protect themselves against these potential damages— and the deposit is the responsibility of the unit owner.
Be sure to check with your board before listing a condo for rent, as failure to pay a damage deposit could result in additional fines and complications down the line.
3. You May Not Be Permitted to Offer Parking to Your Guests
Before renting out a condo, it’s always advisable to ask your board if there are any restrictions on who can occupy parking stalls. Some condo associations prevent anyone who is not a resident from parking in designated areas. There may be visitor parking available, but these spots often have a time limit that must be adhered to.
Consulting with your condo association ahead of time will save you headaches in the future and limit conflicts between your guests and permanent residents.
4. You May Need a Signed Statement From Your Tenant
Some condo boards require short-term tenants to sign a document acknowledging they have received an updated copy of the condo bylaws, have been provided with emergency escape plans or maps, and are aware of any punitive actions that may apply should they not adhere to condo rules and regulations
Failure to obtain a signed agreement could result in the tenant being denied access to the complex or being asked to vacate the property.
5. You Must Maintain Up-To-Date Tenant Records
If your board does permit short-term condo rentals, you are required under Alberta Law to keep a detailed record of who stays in your unit, along with how long they stay and any pertinent contact information.
This log must be written in English and submitted to Chief License Inspector in an electronic format upon demand.
Failure to maintain these records will result in a fine of $1,000.00.
To avoid costly fines or other disciplinary actions, it is best to contact your municipal government office and your condo board to clarify any requirements or permissions before listing a condo for rent.
Additionally, property owners should be aware of the risks associated with short term rentals, including:
- The possibility of major damage to your unit
- Neighbours complaining about strangers coming and going from their complex
- Lack of insurance (Not all insurance companies cover short-term rentals.)
As an example, one Airbnb host in London, Ontario, was left with more than $80,000.00 in property damage after renting out his unit, including broken windows, kicked-in walls, and a destroyed deck.
There are many similar horror stories on the web from homeowners around the world who were hoping to earn additional income, only to be left with a hefty bill.
The more research you do, the less likely you are to encounter these unwanted circumstances.