Once you’ve resolved the long-term rental versus Airbnb dilemma and chosen Airbnb, it’s essential to assess if your condo suitable for Airbnb hosting.
“I thought all condos are suitable for short-term rentals or homestays like Airbnb. Why does my Condo Management say it’s not allowed?”
“I bought it because the agent said it was “suitable for Airbnb” for investment purposes. How come it is not allowed after the AGM?”
In Malaysia, whether a condo suitable for Airbnb depends on:
1) Local State Government Regulations
For example, in Sabah, the Kota Kinabalu City Hall (DBKK) treats Airbnb as a “hotel,” so it must comply with the 1966 Hotel Regulations. In Sabah, regardless of whether it’s a terraced house or a condominium, these regulations (including fire safety requirements, etc.) must be followed. Generally, these requirements are high and difficult for a typical homestay to meet.
Penang Island City Council has effectively regulate all Airbnbs effect 1 March 2024. All properties with residential titles are not allowed to operate Airbnb, except for six types of commercial properties, including serviced apartments, Small Office Home Office (SoHo), Small Office Flexible Office (SoFo), Small Office Virtual Office (SoVo), office suites, and duplex offices.
However, these properties need approval from the Joint Management Body (JMB) and a 75% “favorable” vote from the Annual General Meeting (AGM).
2) JMB
The Joint Management Body (JMB), comprising condo administrators and members elected at the AGM, can impose restrictions. This means, apart from Sabah and Penang, other states might also face JMB restrictions (for example, if most homeowners vote against Airbnb) and cannot operate Airbnb.
So, remember to check with your condo management!
Next Topic: “How to Do Research on Airbnb?“
Does operating an Airbnb always mean higher profits?
Even if your unit complies with all regulations and can be used for Airbnb, learn how to determine whether long-term renting or Airbnb is more profitable for your unit!
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