Landlord Tenant Q&A: LURLINE R. JOHNSON (R), ABR, CRB, CRS, GRI, RMP

LURLINE R. JOHNSON (R), ABR, CRB, CRS, GRI, RMP
Property Manager
Property Profiles, Inc.
Past President, Oahu Chapter
National Association of Residential Property Managers

Q. I was contacted by the manager of the building I have a rental property in. He informed me that he was gathering evidence on my tenant and was pretty sure my tenant is advertising as a vacation rental. The neighbors on the same floor as my unit were complaining that they saw different people coming and going. The manager told me that the building has a strict policy against short term tenancy and if I didn’t clear up the situation, that I would be slapped with a $100 per day fine.

I asked my daughter to check on her computer and she found an ad on Airbnb for my unit!

What should I do?

A. This is a very interesting situation – and one that I am finding isn’t all that unique. I have actually heard of this happening recently and it is indeed a problem for you, the building and your tenant.

First of all, if you are using the Hawaii Association of Realtors Rental Agreement, it states: Paragraph B11. No Subletting or Additional Tenants. No additional tenants subleasing or assignment of the Rental Agreement will be allowed without the prior written consent of Landlord. Guests may not stay longer then (14) days without written approval of Landlord. So your tenant is in violation of his lease – since this would be considered subletting of the property.

Secondly, the building obviously has rules against short term tenancies. Buildings have By Laws and House Rules which dictate the length of time a person may lease out a property – normally at least 180 days. Renting a unit for under 180 days will put it into a different category and subject to additional taxes. A landlord is obligated to pay GE taxes on their rental revenue, but for a term under 180 days there is an also the Transient Accommodations tax. So your tenant has collected rent and most probably not paid either GE taxes or the TAT tax on the rental revenue.

Thirdly, Oahu is part of the City and County of Honolulu and is regulated under Land Use Ordinance – chapter 21 of Honolulu’s Code. The location of the building may not be in an area zoned for short term rental – therefore being in violation of the Land Use Ordinance.

Since your daughter found the advertisement on the Airbnb website, you have enough evidence to confront your tenant. I would suggest that you let him know he is in violation of his lease and the house rules of the building and he needs to take down the ad and cease and desist the illegal short term rental.

In the Landlord Tenant code, Section 69 Tenant Negligence, Failure to Maintain, or Unlawful Use, it states the landlord may take the following steps in cases where the tenant does not comply with the tenant’s obligations to maintain the unit (Section 51):18 A. The landlord may notify the tenant in writing of the problem and specify a time (not less than 10 days) in which the tenant must correct the problem. B. If the tenant cannot be otherwise notified in writing, the landlord may give notice of the tenant’s violations by posting the notice in a conspicuous place on the dwelling unit; C. If the tenant does not correct the problem within the time specified the landlord may: 1. Terminate the rental agreement and sue to evict the tenant; or 2. Correct the problem and bill the tenant for it.

So even if you are required by the LTC to give the tenant a 10 day notice to correct this situation, the building house rules and/or by-laws may be more stringent and require action to be taken even sooner. You need to work in conjunction with the building to notify the tenant and stop this practice as soon as possible.

Good luck to you!

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