Airbnb and Sectional Title Schemes - Can a Body Corporate Restrict Short-Term Letting?

Introduction 

Short-term letting through platforms such as Airbnb has become an increasingly popular way for South African property owners to generate rental income. However, within sectional title schemes, this practice can give rise to concerns about security, noise, parking, damage to common property and the enjoyment of the scheme by permanent residents. 

These competing interests have prompted some bodies corporates to introduce restrictions on short-term rentals, raising an important question: can a body corporate lawfully prohibit an owner from using their unit for Airbnb accommodation? 

The answer depends on the applicable legislation, the scheme's conduct rules and the circumstances of the particular development. Although owners generally have the right to let their properties, that right is not absolute. 

The Legal Framework 

Sectional title schemes are governed by the Sectional Titles Schemes Management Act 8 of 2011 (“the STSMA”). Section 10 permits a body corporate to make, amend or repeal management and conduct rules regulating the use of sections and common property. In terms of section 10(3), these rules must be reasonable and apply equally to all owners. 

The STSMA does not expressly prohibit short-term letting, nor does it specifically define what constitutes a short-term rental. An owner is therefore not automatically prohibited from using a unit for Airbnb accommodation simply because it forms part of a sectional title scheme. The position will depend on the applicable rules and whether any other legal requirements restrict the intended use. 

Municipal by-laws, zoning restrictions and other applicable requirements may also affect the operation of short-term accommodation. Owners should accordingly establish whether their intended use complies with the requirements applicable to their property. 

Owners' Rights and Responsibilities 

An owner's right to let their unit does not absolve them of responsibility for the conduct of their tenants and guests. Section 13(f) of the STSMA addresses an owner's obligation to notify the body corporate of the particulars of tenants or other occupiers, as contemplated by the legislation. Owners must also ensure that the scheme's applicable conduct rules are communicated to occupants and complied with. 

These responsibilities are particularly important where units are let on a short-term basis, as guests may be unfamiliar with the scheme's security arrangements and rules. Repeated changes in occupancy do not necessarily relieve the owner of responsibility for breaches committed by those occupying their section. 

Owners should familiarise themselves with the scheme's rules before accepting bookings, maintain communication with the body corporate and ensure that guests understand the requirements relating to noise, parking, access control and common property. Clear instructions and appropriate arrangements can prevent avoidable disputes. 

Can a Body Corporate Prohibit Airbnb Rentals? 

A body corporate may, in appropriate circumstances, adopt rules restricting or prohibiting short-term letting. However, trustees cannot simply impose a ban through an informal decision. The restriction must be adopted in accordance with the STSMA and the applicable procedural requirements. 

Section 10(5) provides for proposed rules to be submitted to the Chief Ombud for approval. The relevant requirements governing the adoption and approval of rule amendments must therefore be followed before a new restriction can take effect. 

The proposed rule must also be reasonable and apply equally to owners. Its reasonableness should be assessed in the context of the particular scheme, including its location, intended character, the extent of short-term letting and any demonstrated impact on residents. 

A development primarily occupied by permanent residents may present different considerations from one situated in a tourism destination where short-term accommodation is common. Accordingly, a restriction that is reasonable in one scheme will not necessarily be appropriate in another. 

The Paddock Judgment: Can Short-Term Letting Be Restricted? 

The High Court considered the enforceability of restrictions on short-term letting in Body Corporate of The Paddock Sectional Title Scheme No 249-1984 v Nicholl 2020 (2) SA 472 (GJ). 

The dispute arose from concerns about the use of units for Airbnb accommodation, particularly the associated security risks and disturbances. The body corporate amended its conduct rules to prohibit letting for periods shorter than six months. Despite being notified of the restriction and warned about non-compliance, the owner continued to let her unit on a short-term basis. 

The owner challenged the validity and enforceability of the restrictions, arguing, among other things, that they interfered with her property rights. The High Court upheld the relevant rules and ordered her to cease letting the unit for periods shorter than six months. The order also addressed prohibited commercial use and compliance with the scheme's rules. 

The judgment confirms that an owner's investment objectives do not automatically override validly adopted sectional title rules. Property rights must be exercised within the applicable legal framework, and properly adopted restrictions may be enforceable even where they limit an owner's preferred rental arrangements. 

However, the judgment does not establish that every body corporate may automatically impose a six-month minimum rental period. The validity and enforceability of any restriction will depend on the relevant legal requirements, the rule itself and the circumstances of the scheme. 

Addressing Nuisance and Repeated Rule Breaches 

Not every dispute involving short-term letting requires a prohibition on Airbnb. In many cases, the underlying concern relates to specific conduct, such as excessive noise, unauthorised access, improper parking or damage to common property. 

A body corporate should consider whether its existing rules adequately address these issues before introducing a broader restriction. Clear rules governing security, parking, noise and the use of common property may provide a more targeted solution. 

Where an occupant breaches a valid rule, the body corporate may pursue the remedies available under the applicable rules and legislation. If the rules authorise penalties, these must be imposed in accordance with the required procedures. The body corporate should identify the rule breached, establish the basis for the penalty and afford the owner the required opportunity to respond. 

The fact that different guests are responsible for separate incidents does not necessarily prevent the owner from being held accountable for repeated breaches. Owners remain responsible for taking appropriate steps to ensure that occupants comply with the scheme's rules. 

Where internal measures fail, affected parties may consider approaching the Community Schemes Ombud Service (“CSOS”) for appropriate relief, depending on the nature of the dispute. Complaints should be supported by evidence of the alleged breaches and their impact. 

Finding the Right Balance 

Short-term letting requires a balance between an owner's legitimate investment interests and the collective interests of the sectional title community. A blanket prohibition may not always be necessary where specific concerns can be addressed through reasonable, properly enforced rules. 

Before introducing restrictions, trustees should consider the nature of the scheme, the actual impact of short-term letting and whether the proposed measures are proportionate to the concerns identified. Owners, in turn, should understand the applicable rules and take reasonable steps to ensure that their guests comply with them. 

Legal advice can assist both parties in determining whether a restriction has been validly adopted, whether a penalty is authorised and what remedies may be available where disputes arise. 

Conclusion 

Short-term letting is not automatically prohibited in sectional title schemes, but neither is an owner's right to let their unit unrestricted. The STSMA allows bodies corporate to regulate the use of sections and common property, provided that the applicable requirements of reasonableness, equal application and proper procedure are satisfied. 

Ultimately, bodies corporate should address genuine concerns through lawful and proportionate rules, while owners should ensure that their letting arrangements comply with the scheme's requirements. Clear communication, responsible management and a sound understanding of the legal framework can help protect residents' interests without unnecessarily interfering with owners' property rights. 

Contact an expert at SchoemanLaw Inc in Cape Town or Paarl for assistance with your property related needs. 

https://schoemanlaw.co.za/services/property-and-conveyancing/  

Kerri Stewart | SchoemanLaw Inc 
Attorney