Hoa's Power: Can They Limit New Airbnb Laws?

With the rise of Airbnb and other home-sharing services, many homeowners' associations (HOAs) are considering banning short-term rentals. HOAs can restrict the use of Airbnb and other short-term rentals, so long as they follow their stated amendment process. However, the question of whether an HOA can impose such a restriction without violating the rights of the homeowner remains a subject of debate.

Can HOAs ban short-term rentals?

Yes, HOAs can ban short-term rentals. Homeowners' associations can enact a ban on short-term rentals, so long as they follow their stated amendment process. An HOA may already have the power to ban the use of Airbnb, VRBO, and other short-term rentals under their current deed restrictions if prohibitions against “commercial use” of parcels are already in place.

State courts have long held that restrictions enacted by HOAs can and will be binding so long as they have been properly passed subject to amendment processes laid out in their controlling documents. However, it should be noted that a covenant prohibiting other short-term rental arrangements does not impact a homeowner’s ability to sell the property.

In Michigan, HOA members have a common-law right to try to enhance the value of their property through contractual agreements concerning the use and development of their real property. It is important to consult the CC&Rs to assess your community’s rules and restrictions regarding Airbnb rentals. There can be serious consequences to flouting the HOA rules, including fines, legal action, or other restrictions.

What are the consequences of breaking HOA rules?

Homeowners' Associations (HOAs) can restrict Airbnb and other short-term rentals, as long as they follow their stated amendment process. If prohibitions against 'commercial use' of parcels are already in place, HOAs may already have the power to ban the use of Airbnb.

There can be serious consequences for breaking HOA rules, including fines, legal action or other restrictions. It is not advisable to go against your HOA on this matter. To assess your community's rules and restrictions regarding Airbnb rentals, consult the CC&Rs.

State courts have held that restrictions enacted by HOAs can be binding, so long as they have been properly passed subject to amendment processes laid out in their controlling documents. However, it is important to note that a covenant prohibiting short-term rental arrangements does not impact a homeowner's ability to sell the property, although it may be more difficult to sell than a similar property that is not subject to HOA oversight.

In Michigan, HOA members have a common-law right to try to enhance the property value through contractual agreements concerning the use and development of their real property.

Can HOA members impose restrictions on real property interests?

Yes, HOA members can impose restrictions on real property interests. For example, HOAs can ban short-term rentals such as Airbnb, VRBO, and other home-sharing services. This is permissible so long as the HOA follows its stated amendment process. HOAs may already have the power to ban the use of these services under their current deed restrictions if prohibitions against “commercial use” of parcels are already in place.

However, it should be noted that a covenant prohibiting short-term rental arrangements does not impact a homeowner’s ability to sell the property. Nevertheless, it may be more difficult to sell than a similarly situated property that is not subject to HOA oversight. State courts have held that restrictions enacted by HOAs will be binding so long as they have been properly passed subject to amendment processes laid out in their controlling documents.

In Michigan, HOA members have a common-law right to try to enhance the property value of their real property through contractual agreements concerning its use and development. There can be serious consequences to flouting HOA rules, including fines, legal action, or other restrictions.

Can HOAs ban the use of Airbnb, VRBO and other short-term rentals?

Yes, HOAs can ban the use of Airbnb, VRBO and other short-term rentals. If an HOA has prohibitions against 'commercial use' of parcels in place, it may already have the power to ban the use of these services under current deed restrictions.

In Michigan, HOA members have a common-law right to try to enhance the value of their property through contractual agreements concerning the use and development of their real property. However, state courts have held that restrictions enacted by HOAs can and will be binding so long as they have been properly passed subject to amendment processes laid out in their controlling documents.

There can be serious consequences to flouting HOA rules, including fines, legal action, or other restrictions. It is therefore not a good idea to go against your HOA on this matter. To assess your community’s rules and restrictions regarding Airbnb rentals, consult the CC&Rs.

How do HOAs interpret 'single family residential purposes'?

Homeowners' Associations (HOAs) can restrict the use of Airbnb, VRBO, and other short-term rentals, so long as they follow their stated amendment process. If prohibitions against 'commercial use' of parcels are already in place, an HOA may already have the power to ban these services.

HOAs are typically formed within communities or neighbourhoods of single-family homes or multiple-unit buildings such as townhomes or condominiums. They are run by a board of directors and collect fees to pay for common area maintenance and the upkeep of facilities. They can impose fines on non-compliant homeowners.

In the case of single-family residential purposes, an HOA that only allows for parcels to be used for 'single-family residential purposes' could be interpreted as banning 'commercial use'. Case law has determined that any short-term rentals would violate the deed restrictions.

In Michigan, HOA members have a common-law right to try to enhance the value of their property through contractual agreements concerning the use and development of their real property. However, state courts have held that restrictions enacted by HOAs can and will be binding so long as they have been properly passed subject to amendment processes laid out in their controlling documents.

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