Controversy over Short Term Rentals at Residencial BVG

I thought some readers of this board might be interested in this site:
http://bvgcancunowner.wordpress.com/

Apparently many owners at Residencial BVG bought their units with the understanding that they would be allowed to do short term rentals. Now the board at BVG is trying to prevent short term rentals there.

On Friday (Feb 13) the board announced a meeting set for Monday (Feb 16) at which they will decide this issue. Obviously lots of owners can't make it to a meeting announced with only 3 days notice. So the board is trying to force their will without a democratic process.

The reason I care is that I have a client and friend who owns at BVG, so I hear about this problem blow by blow. But also I've seen this same thing happen at other condo complexes here in Mexico. The tactics being taken by this Board are all to common.

Anyway I thought I would share for those of you might be interested.

 

RG,

Does QR or Cancun have laws for a democratic management system, like one vote for one unit and the board is elected by the membership on that basis?

My experience in the states is that the developer has super powers until about 60 of the units are sold and then turns over control to the owners, which of course the developer still is but they can be outvoted.

Any changes to the Bylaws, where I would presume things like short term rentals are addressed, has a higher percentage of votes necessary to amend the bylaws, that number running normally in the 2/3 range, but the law varies from state to state. Do you know if such a law/rule is in place here.

Finally, in Florida, there are statutory regulations regarding meetings, and notice of meetings except in the case of an emergency situation, like a fire for example, but this would not meet the typical emergency criteria.
Are any such laws in place in Mexico, or in Cancun specifically?

What you describe would not occur in Florida (which I know we are not) without about 2/3 or more of the owners voting for a change.

 

TJ - I don't know what the Mexican laws are. I expect that the condo assn laws in Mexico have been fashioned after those in the states, but how well fashioned who knows? And I don't know the specifics.

I know that in the case of Residencial BVG the moment when the HOA takes over from the developer is apparently now or imminent. So timing may be play a part in what can be done legally right now.

It seems at BVG that there are many issues. And there are lots of absentee owners who don't speak much or any Spanish and don't understand the Mexican law. It also seems, though I don't know for sure, that the new HOA may be taking advantage of the fact that so many owners aren't here and don't understand Mexican law or Spanish.

Every condo complex around here that I know anything about has some subset of the problems apparent at BVG. Unfortunately for BVG owners BVG seems to have ALL the problems at once, it's the poster child for how not to run a condo complex in Mexico.

It will be interesting to see how it plays out. And I hope for my friend's sake that peace is made among owners at BVG. It would be horrible if all the owners at BVG who bought expecting to rent simply stop paying maintenance, for example. Every property owner there would suffer if that happened.

They need to find a compromise that allows for short-term rentals but also makes the owners who live at BVG comfortable that they won't be over run by obnoxious renters who puke in the pool, or whatever obnoxious renters do...

 

Not directly related here but something that has always been a legal and political problem--starting in places like Akumal, Playa del Carmen and Isla Mujeres and now expanding into a more visible Cancun with its growing number of full time condos--is the fact that short-term rental is in direct competition with the hotel industry and produces problems like licensing, control and payment of the 2% State lodging tax. Not sure how much this has to do with the internal working of the HOA. Also sure that HOA rules in the States are not comparable to rules in Mexico. Would have to read the regs and see the quality of the "deeds" issued.

 

Thanks Jim - I did hear that there have been threats at BVG between non-renting owners and renting-owners, the threat being to turn the renting-owner in to Hacienda for not paying income taxes on the rental income.

Not sure how viable or simple it is to turn someone in for tax evasion here, especially when most of the foreign renting-owners probably do not hold FM3's. It's a pissing match over there.

 

And on looking at the website for the owners, it seems they told potential buyers who wanted to rent that they could rent and potential buyers who wanted to live there full time that the others could rent short-term-- exactly what each wanted to hear. How strange for salespeople to do that. :roll:

 

Apparently the EXACT same thing has happened at other condo complexes that were built by Sacal. This seems to be the developer's M.O.

BVG Ixtapa has had huge problems because buyers were told different things about whether rentals were allowed. Buyers who wanted to rent their units were told they could freely do so without restriction. Buyers who bought wanting no rental units there were shown a 90-day minimum rental clause, so they were assured of no short term rentals.

It's too bad for owners because they are brought in with differing understandings and then find themselves having to work together to solve a problem none of them created.

 

In the real world the written contract and the Declaration of Condominium govern everything between Buyer and Seller. In Kissimmee, Florida there are entire housing developments full of short term rentals geared mostly toward Brits. But sales taxes must be paid on short term rentals which levels the playing field with the hotels. There are similar docs governing houses as opposed to condos. Sometimes I wonder how people who have enough money to buy these places can be so stupid to buy expensive things in a foreign country without getting legal advice. Caveat emptor.

 

Ah well, don't you think that if you ask 3 Mexican attorneys before you buy a condo here that you would get 3 different takes on what matters?

I agree though, getting legal advise before you buy is critical. Though my friend did that and still ended up owning at BVG with all these troubles...

 

3 lawyers?? At the very least 4 opinions.