Apartment associations seek greater control over short-term rentals

Apartment associations should have a greater say in organising rental arrangements, the Estonian Union of Apartment Associations told ERR, proposing that owners’ meetings be allowed to ban the rental of apartments. Economy and Industry Minister Erkki Keldo said residents’ concerns were understandable but warned that restrictions must respect private property.

The union proposed that apartment associations be given the power to prohibit the rental of individual apartments through a decision by the general meeting of owners. The decision would require more than half of the votes and more than half of the co-ownership shares.

“Rental arrangements play a very important role in the everyday life of an apartment association,” said Urmas Mardi, a board member and head of the union’s legal department. He said an increasing number of associations had complained about short-term rentals arranged through various online platforms.

According to Mardi, constantly changing guests sometimes treat shared property carelessly, make noise, ignore waste-management rules, smoke where they should not and park their cars indiscriminately. In one case, a guest arriving at accommodation late at night broke the glass in the building’s exterior door with a brick after failing to find the key.

Other residents, Mardi said, do not want to pay for damage caused by accommodation providers. He added that associations in attractive tourist destinations faced particularly difficult circumstances. In some buildings, only a few apartment owners live on site while the remaining properties are investment apartments, making it nearly impossible for permanent residents to agree on plans to improve their building.

The union said that owners living in a building could also see their property values decline if their home became a constant stream of strangers rather than a residential environment. This could encourage permanent residents to move elsewhere, changing the entire neighbourhood.

The union said rental regulations needed to be analysed carefully because the freedom to conduct business is a fundamental right and any bans or obligations must be proportionate. At the same time, people have a fundamental right to feel safe and rest peacefully in their homes.

The union cited practices in other countries. In Spain, an owners’ association can approve or restrict renting apartments to tourists with at least three-fifths of the votes. In France, tourist accommodation can be prohibited under certain conditions with a two-thirds majority.

Keldo told ERR that he understood the concerns of apartment owners and associations. “If short-term rentals cause noise, a constant turnover of guests or other disturbances in a building, people must be able to protect the peace of their homes,” he said. “No one should have to suffer because the use of a neighbouring apartment clearly begins to disrupt everyday life.”

The union submitted its position to the Ministry of Economic Affairs, which completed plans earlier this summer to draft amendments to the Tourism Act aimed at regulating the short-term rental market. The current act does not specifically address short-term rentals, while guest apartments account for an increasing share of the accommodation market.