Airbnb – Are You Breaching the Terms of Your Lease?
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A recent English case highlights that even if a lease does not restrict short term letting, permitting Airbnb style short term lettings might breach other lease terms
Airbnb is a website that enables
people to list short term rental accommodation in residential properties. Use
of this and other similar websites have become increasingly popular in Ireland.
A recent English case highlights
that even if a lease does not restrict short term letting, permitting Airbnb
style short term lettings might breach other lease terms. In that case the
owner of an apartment in a purpose built apartment block was held to be in
breach of her lease by advertising the availability of her apartment for short
term lettings and granting a series of such lettings.
The lease contained a restriction on
sub-letting in the last seven years of the term. With just over 80 years left
to run on the lease this restriction did not apply at the time. However the
owner was held to be in breach of her covenant to use the premises as "a
private residence". It was decided that in order for a property to be used as
the occupier's private residence there must be a degree of permanence going
beyond being there for a weekend or a few nights in the week. The Court stated
that whether other tenants with a similar covenant would be found to be in
breach would depend on the construction of the particular covenant in its own
factual context. This case highlights the importance of looking at all lease
covenants and not just those relating to rights to
sub-let.
The issue is clearly under the
spotlight in Ireland too. Recent media reports indicate that residents of
various apartment complexes are being advised that short term lets such as
those offered on Airbnb are contrary to their leases; and the Planning Laws are
also being employed. Recently An Bord Pleanála agreed with the Temple Bar
Residents' Association that the use of an apartment at Crown Alley, Dublin 2
for Airbnb lettings required planning permission. In that particular instance
the Board reasoned that because of the high turnover of visitors, the attendant
security risk, support activities (such as cleaning staff) to service the
lettings and lack of a resident host distinguished the apartment's use
sufficiently from the residential use of the rest of the block and impacted
sufficiently on the amenity of the other residents as to amount to "material
change of use".
Contributed by Tara Rush & Conor Linehan
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