BY JOHN KIRITSIS, ESQ., CPA, MBA, MS, JD, LL.M
Airbnb and short-term rentals can raise specific legal issues when it comes to cooperatives (co-ops) in New York City (NYC). Co-ops have their own set of governing documents, bylaws, and rules that dictate how unit owners can use their properties. Here’s an overview of Airbnb-related legal issues for NYC cooperatives:
- Review Governing Documents:
Examine the co-op’s governing documents, including the proprietary lease and bylaws, to determine whether short-term rentals like those on Airbnb are allowed. Many co-ops have restrictions on rentals, particularly short-term rentals.
- Lease Terms and Restrictions:
Co-op proprietary leases often include language that prohibits subleasing or renting units for short periods, such as those typically associated with Airbnb rentals. Violating lease terms can lead to legal consequences.
- Enforce Rules Consistently:
If short-term rentals are prohibited by the co-op’s governing documents, the co-op board should consistently enforce these rules to prevent violations and maintain the integrity of the co-op community.
- Communicate with Shareholders:
Keep shareholders informed about the co-op’s rules and regulations regarding short-term rentals. Clear communication can help prevent misunderstandings and violations.
- Violations and Penalties:
If a shareholder is found to be renting their unit on Airbnb in violation of the co-op’s rules, the co-op board may impose penalties or fines as outlined in the governing documents.
- Legal Action:
In cases of repeated violations or blatant disregard for the rules, the co-op board may consider legal action against the shareholder, which could lead to eviction or other remedies.
- Enforce Lease Approval Process:
Many co-ops have a rigorous application and approval process for new shareholders or lessees. Ensure that all potential renters or lessees are vetted and approved according to the co-op’s standards.
- Amend Governing Documents:
If the co-op’s governing documents do not already address short-term rentals, consider proposing amendments that explicitly prohibit or regulate them.
- Consult Legal Professionals:
Consult with attorneys who specialize in NYC co-op law to ensure that the co-op’s actions are legally sound and comply with local regulations.
- Monitor Short-Term Rental Platforms:
Keep an eye on short-term rental platforms like Airbnb to identify any unit owners who might be violating the co-op’s rules. Promptly address any new violations that arise.
Navigating Airbnb-related legal issues in NYC cooperatives requires a careful understanding of the co-op’s governing documents, local regulations, and legal options. It’s crucial to consult with legal professionals who specialize in NYC co-op law to ensure that any actions taken are legally compliant and appropriate for the co-op’s unique circumstances.
Citations, References and Potentially Useful Resources for Further Information:
New York State Constitution
Federal Securities Regulation
New York State Martin Act
New York Condominium Act
New York State Security Regulations
New York Business Corporation Law
New York Limited Liability Company Law
New York Uniform Partnership Act
Federal Internal Revenue Code
New York State Tax Laws, Rules & Regulations
New York City Tax Laws, Rules & Regulations
Winston Churchill Owners, Inc. v. Regents Real Estate Associates
Board of Managers of the Park Regis Condominium v. Park Regis Owners Corp.
Park Sutton Condominium v. 447 E. 57th St. LLC
28 E. 10th Street Corp. v. Veras
Riverside Syndicate, Inc. v. Munroe
Essex House Condominium v. Marks
The Parc Vendome Condominium v. Atkinson
54-56 Meserole Street Owners Corp. v. Rossi
The Beekman Regent Condominium v. Bottiglieri
Chelsea 19th LLC v. West 19th Street Realty LLC
New York Department of Finance
New York City Department of Buildings
New York City Bar Association
New York State Bar Association
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