Have you ever signed a Tenancy Agreement whereby you have approved permission from the landlord for the Tenant to "holiday" let the property in exchange for a fixed term tenancy agreement ?
If so, you could be putting yourself and your landlord in very dangerous territory.
It has become increasingly relevant during this time of Covid-19 that we need to be completely vigilant and have a sound understanding of the Legislative restrictions for what seems a relatively simple and innocent agreement (contract).
Innocently enough a number of agents and landlords have been caught off-guard by one of the most important pieces of legislation that in itself provides for an unregulated holiday market to flourish in a normally vibrant and strong economic climate. The relationship works blissfully well, rarely requires conciliation when the borders are open and visitors need a place to lay their head. BUT what happens when the holiday income stops ????
Much to the surprise of many, SACAT may not be able to assist your situation, and you maybe forced to seek alternative legal interventions simply due to the fact that
certain agreements are expressly excluded from the application of the Act.
Section 5 (c)
This Act does not apply to-
"an agreement genuinely entered into for the purpose of conferring on a person a right to occupy premises for a holiday;"
Yes, both parties have signed a written Residential Tenancy Agreement BUT its validity maybe questionable depending on the basis and circumstances in which it was entered.
The mechanisms of the Act and the jurisdiction of the Tribunal relevantly require there to be a “residential tenancy agreement” in place. Section 3 of the Act conclusively describe a residential tenancy agreement as ‘an agreement (other than a rooming house agreement) under which a person grants another person, for valuable consideration, a right (which may or may not be an exclusive right) to occupy premises for the purpose of residence.
So where to from here ?
- Make sure your Tenancy Application and pre-qualification process is robust and comprehensive.
- Don't presume the applicant is or is not planning to operate an accommodation business with the property, you may just need to ask.
- If you catch wind of any suspicious behaviour, deal with it immediately.
- If you suspect the property is being used for residential purposes, approach your tenant and take appropriate measures to uphold the Tenancy Agreement.
- Checkout the Holiday letting platforms for any activity that you might think maybe occuring, and evidence your findings.
- Keep your owner in the loop at all times.
- Steer clear of any sketchy candidates you think maybe looking for opportunities.
- Avoid commercial arrangements with serviced companies who offer to lease.