The FHA will deny certification to condominium associations if they allow short-term or "transient" housing, i.e., rentals for less than thirty (30) days. For those associations with no rental restrictions, there are two solutions:
1. Amend their governing documents to remove the offending language, or CC&R Amendment
2. Provide a dated and
signed statement on association letterhead that no units in the
development are leased for a term of less than 30 days and tenants are
not provided services commonly associated with hotels. (See FHA announcement.)
. The Davis-Stirling Act provides that rental prohibitions adopted after January 1, 2012 do not apply to existing owners in a development; they only apply to those who acquire property after the prohibition has been adopted. (Civ. Code §4740
Because this requirement is so recent, there is no case yet telling us what is an acceptable restriction versus an unacceptable prohibition.
: In our opinion, an amendment requiring all rentals to be thirty days or longer would apply to all owners, not just those who acquire property after it was adopted.
: Associations needing legal assistance can contact us
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