Landlord Fined for Tenant’s Actions

by | May 22, 2017 | Rental Property Management Tips

A landlord in Montreal is speaking out after he was fined over $1,200 because his tenant sublet an apartment on Airbnb contrary to condo board rules.

The landlord says he had no knowledge of the tenant’s actions and that the tenant was already in place when the landlord purchased the condo, according to a news report. The tenant sublet the property in violation of the condo board bylaws around 65 times.

The case is similar to one is New York City where a landlord was fined after his tenant rented out a room nightly on Airbnb in violation of a city ordinance prohibiting short-term rentals. In that case, too, the landlord was unaware. To add insult to injury, some tenants in rent-controlled apartments make more money through Airbnb sublets than the landlord receives in rent.

The problem stems from the fact that Airbnb allows “hosts” to block the address of the property in ads, so unless a landlord happens to see a familiar picture, it is virtually impossible to find out if the tenant is using the property to make money. Once a tenant does get caught — usually because the neighbours complain — it can be difficult and costly to win an eviction.

Other major cities, including Vancouver and Toronto, are studying the impact that short-term vacation sublets have on the rental housing market. It is possible that officials will follow the New York strategy and ban these rentals or require registration in order to host short-term guests. Presumably, tenants will be required to seek their landlord’s permission before using properties in this fashion.

This sort of tenant sublet is a disturbing trend for landlords primarily because the guest tenants are not properly vetted before gaining access to a unit or the entire building. Landlords should practice vigilance to ensure that their properties are not being exposed to the resulting risks without their knowledge.

Prohibiting the practice in the tenancy agreement is a good first step. Keep in mind, though, that changes to the lease during the term of the tenancy may only be enforceable if the tenant agrees to the modification. Otherwise, the change will have to be implemented at lease renewal or with the next tenant.

For existing tenants who are abusing the lease by subletting to strangers, ask your lawyer if other provisions of the tenancy agreement might be sufficient to evict the tenant. For instance, it may be a lease violation if the use is restricted to residential only. Renting out rooms for profit is considered a commercial use. Also, breaking the law or condo rules may be grounds for eviction.

Because any restrictions regarding short-term rentals remain a work in progress, it is also a good idea to stay active in your local landlord association. To the extent that these groups can present a united front, they give voice to all landlords, even those who own just one unit.

This post is provided by Tenant Verification Service, Inc., helping landlords reduce the risks of renting with fraud prevention tools that include Tenant Screening, Tenant Background Checks, (U.S. and Canada), as well as Criminal Background Checks, and Eviction Reports (U.S. only).

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Disclaimer: The information provided in this post in not intended to be construed as legal advice, nor should it be considered a substitute for obtaining individual legal counsel or consulting your local, state, federal or provincial tenancy laws.

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