Your Building and the Sharing Economy

Ask Kari is a monthly, Question & Answer feature from Kari Negri. Kari has two decades of property management experience, is a featured speaker at many industry trade shows, such as AAGLAs annual trade show, and is the CEO of SKY Properties, Inc. in Los Angeles.

Your Building and the Sharing Economy

Hi Kari, one of my tenants listed their unit on Airbnb, and I don't allow subletting. How can I avoid this in the future? ~ Tom

Thanks for a great question, Tom! In todays world, there are many services offered in the sharing economy. Have some extra space in your car and want to give someone a lift? Consider becoming a driver with Uber or Lyft. Have some extra office space or a conference room to offer by the hour? Take a look at Peerspace. Have a room or entire home you own and want to offer to travelers? Take a look at Airbnb or VRBO.

Wikipedia describes Airbnb thusly: Airbnb is a website for people to list, find, and rent lodging. It has over 1,500,000 listings in 34,000 cities and 190 countries.

When traveling, many people enjoy using Airbnb and VRBO to book a place to stay rather than a hotel. They rave about the services and ease of use. European vacation stays can be entirely and easily arranged via sharing services. Since the offerings are generally from private parties, the lodging can be less expensive, and the user ratings apply to the specific room, hosts and the neighborhood, giving a more refined level of accuracy compared to hotel reviews. It is typical among millennials to check both sharing services and hotel websites, when they travel. Some have disregarded checking hotels entirely.

As a traveler, sharing services are highly recommended. As a building owner, there may be concerns with a sharing service. As the tenant does not own the unit, their right to temporarily sublease their unit should be a violation of their lease and could bring unknown elements into the apartment community. Here are some things to consider when it comes to the sharing economy service industry.

Does your lease allow subletting? If so, consider speaking to an attorney and revising this part of your lease. At a minimum, add stringent requirements regarding subletting. If you do not allow subletting, and find out one of your tenants is offering to sublet or temporarily sublet your unit, take swift and immediate action as you would with any major lease violation. If you suspect a tenant of subletting their unit, the first thing to do is ask them about it. If you are unable to reach them (because they are possibly out of town while doing short-term subletting), serve them with a warning letter making it clear that, if subletting, this could be reason to begin a UD (unlawful detainer) and should never be done without consent and approval of the landlord. That is the first approach with a good tenant that might not have understood that sharing services are a form of subletting. If this is a problem tenant, you can get an attorney to send them a letter / serve a 3-day to cure or quit, and possibly begin eviction proceedings. You will want to document all proof of the violation, such as the ad itself, reports of strangers at the property, etc.

Just like with any subletting violation, since the building owner or manager was not involved in the vetting process of the temporary resident, the concerns include: not knowing who is actually in the unit, having no background information on them, potentially inviting a criminal element into the apartment community, putting other tenants at risk, and causing discomfort amongst other tenants with strangers on the property.

If you'd like to see if one of your properties is listed by a tenant on a sharing site, simply perform a search on the sharing service website. Since exact addresses are not listed, only general neighborhoods, search your city area and zoom the map to the markers near your building. Review the pictures, and if you recognize one of your units, take action from there. You must communicate with your tenant about the issue. Sharing services wont let third-parties (you) remove or alter a listing, so you must go through the person who listed the property, or have a court order.

Thanks again for your question, Tom. As always, please remember, I am not an attorney. Seek clarification through your attorney. All articles are simply an opinion.

Authors note: Last month, the article, Avoiding CAT-astrophes in Property Management was a guest post written by Carmen Zelaya, SKY Properties, Inc. Supervisor. Her authorship was not credited, so wanted to thank Carmen for a great article!

As always, stay in touch at www.GetSky.net

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