The costs of having short-term rentals in a condo corporation
It is long felt that short-term rental units makes money for the
individual owner, at the expense of the owner-residents and the owners
who lease their units but it was not know just how much it cost.
One condo corporation in Sydney Australia did find out. The board hired
a third-party to investigate the costs of hosting 205 short-term rental
units and the costs were staggering.
After banning short-term rentals, the owners collectively saved
$450,000 AUD per year in administration and maintenance costs whilst reducing common element fees by five
percent per year in each of those three years.
Why so high?
There are a number of issues with short-term rentals many that are not so obvious. They include:
With up to six or more people in an apartment unit, that means a lot of
people and heavy suitcases going up and down the elevators.
Increase in security costs
Especially on the weekends, the corporation had to hire extra security guards.
The required laundry services meant more elevator trips and heavy water
usage as every time a "guest" moved out, all the sheets and towels had
to be washed.
The study estimated that the additional burden from
short stays had reduced the life span of the elevators from twenty-five
years to twenty years. At Watergate, the board says that 80 tonnes of
washing relating specifically to short-stay is going through the elevators
every year along with 50,000 suitcase trips and 200,000 access
trips. An elevator expert in the building, she says, claims he can walk into
the elevator of any building and know whether or not there are
short-stay apartments there by looking at the doors and see how they have
been forced open on a regular basis.
Wear and tear of the common elements
The hallways and lobby suffer from premature deterioration.
Parties & noise
Many of the guests are on vacation or renting the apartment to hold a
party. Noise issues are common along with in increase in vomit and
urine in the hallways, elevators and staircases.