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Short Term RentalThe rising popularity of websites such as, Roomerama, and multiple other sites has made it attractive to some condominium owners to rent all of, or just a bedroom in, their condominium unit to earn a little extra money. In most of these cases, the rental is very short-term, often one, two or three nights.

Obviously, a condominium, a community of resident-owners, is just that, a “community.” And with a community, while change is inevitable, that change is gradual. Seeing individuals in hallways, elevators, parking garages and parking lots, without knowledge of how they got to be in that particular spot, can be jarring if it is unexpected. When a unit is for sale, or if permitted by a condominium’s declaration, for lease, neighbors have an expectation that a new person or family will soon be taking up residence. There is no forewarning, however, in the case of a short-term rental.

Most condominium associations likely would prefer to restrict, if not prohibit, such short-term rentals. Not only is there both the sense, if not the reality, of a safer environment, but by avoiding an unknown transient population, common amenities, such as pools, lawns and landscaping, halls, and elevators likely encounter less wear and tear, if not overt acts of vandalism, thereby saving the association increased expenses.

In the only reported case dealing with short-term rentals of the type described above in a condominium in Missouri, the Missouri Court of Appeals in a 2006 case upheld the trial court’s decision, finding that such short-term rentals were permitted under the declaration governing the Silvercreek Condominium Owner’s Association. In that case, the condominium association’s attorney sent notice to a few owners 10 years after the condominiums were built and a couple of years after plaintiffs purchased two units, informing the owners that they were in violation of the declaration “by renting or allowing rental of [their] units for overnight rental,” an impermissible business use. Furthermore, the condo association’s attorney included a letter from the municipality’s attorney stating that nightly rentals violated the existing zoning ordinances of Rockaway Beach.

The plaintiffs produced evidence at trial that at the same time the condominium was built, a nightly rental program was advertised. Moreover, prior to purchasing the condo units, the plaintiffs were told that nightly rentals were allowed. But perhaps most convincing to the trial court and Court of Appeals was a provision in the declaration which stated, after restricting use of condominium units to exclusively residential use and prohibiting business use of the unit, that “nothing in this [Section] is intended to restrict the right of any condominium unit owner to rent or lease his (their) condominium unit from time to time.”

Missouri courts are to give effect to the intent of the parties as expressed in the plain language of a covenant. Further, restrictive covenants are not favored in the law of Missouri, and when an ambiguity interpreting covenants exists, the law favors the free use of property. Thus, reading the use provisions of the declaration as a whole and finding an ambiguity in attempting to reconcile the two apparently contradictory clauses, the court interpreted the covenant narrowly to allow the free use of the property, and thus the nightly rentals could continue.

A brief survey of how other states have construed condominium declarations (but without permissive language of the type found in the Silvercreek condominium declaration) in light of attempts to engage in short-term rentals have, for the most part, failed regardless of whether the property was a condominium or a single-family home in a subdivision. Most often, the courts found that a restriction in use to only “residential purposes” was too ambiguous to prohibit short-term rentals.

If your condominium does not want short-term rentals to become an issue, a thorough review of your condominium declaration is obviously a necessity. If any language would appear to allow nightly or other short-term rentals, action to amend your declaration, after consulting with your association’s legal counsel, should be undertaken. If the rental of units is already too widespread, getting an amendment may prove nigh impossible.