Renting out your residence

On account of VRBO, Airbnb and the like, this has come up a lot nationwide in recent years. The case law is nearly unanimous that renting out a home for residential purposes is not a commercial use no way no how. Consider skimming this 2017 Florida appeals court case: https://law.justia.com/cases/florida/first-district-court-of-appeal/2017/16-4782.html . The Florida decision observes that the issue has been considered in "a number of other states" and "those courts have almost uniformly held that short-term vacation rentals do not violate restrictive covenants nearly identical to those [restricting commercial use]" in the present case. The opinion cites the relevant appeals court opinions from Kentucky, Colorado, Washington, New Mexico, North Carolina, Alabama, Indiana, Virginia, Maryland, Missouri, Idaho, Oregon, Ohio, Tennessee and Texas.

(Thanks again to GenoS for citing this Florida appeals court decision here back in December, 2019.)

If your HOA wants to require owners who rent their homes to do so for, say, a minimum of 30 days, then whether the HOA could do this depends on what the covenants say about renting. If what you kindly quoted is all the covenants say about renting, then right now, the board likely can do nothing. What the board might want to consider is seeking a membership vote to amend the covenants.

Around June of 2019, the Montana legislature passed Bill SB300. See https://www.hartres.com/blog/recently-passed-senate-bill-to-help-protect-montana-property-owners/. From the latter: "Plainly put SB 300 protects property owners from a homeowners’ association (HOA) imposing new covenants, conditions, and restrictions (CCRs) on certain uses of the property."

Here is a link to a March 2019 letter from a Montana attorney to a state legislator on this subject: https://www.caionline.org/Advocacy/Documents/K%20Kelker%20SB%20300%20comments.pdf . The attorney's law firm represents a HOA. A few years ago the HOA brought suit against a couple that has been renting their home as a VRBO. I am not sure if the suit is ongoing or not. The letter notes that the HOA passed an amendment (well before SB300 became law) to their covenants prohibiting short term rentals. It might be worthwhile to contact the attorney or, even better, contact the Carbon County Montana court clerk and see if you can get a copy of the briefs and motions filed. Bear in mind that SB300 may change the relevance of this lawsuit to the OP's situation.

Thank you for your reply on SB 300. This is not a new CC&R this section has been in effect since 1993 and all members are required to sign and agree to the CC&R"s at the time they purchased . When the person bought the property these covenants had been in effect for about 15 years. I will look at this closer.

Does Montana's SB 300 provide for any grandfathering-in of already existing restrictions? Many Florida communities (mainly in areas that attract tourists) have restrictions on short-term rentals. In the last few years the legislature has been making noise about putting a stop to those local restrictions because they "hurt the economy" by denying propery owners the right to do whatever they want with their property. Opponents of state pre-emption are angry because the legislature for years has championed "home rule" in Florida for local governments seeking to get out from under certain state regulations.

The bill was on its way to becoming law this year before it died on the vine in March when everything went sideways with the coronavirus. It will definitely be back again in 2021 since for every group in opposition to state pre-emption there's another group (with a bigger bag of money) in favor of it.

The bill did provide that local laws passed before June of 2011 were grandfathered in and allowed to continue in force.

The last section of the bill exempts condos, co-ops and HOAs from the new act.

On SB 300 you are right, its going to be very difficult to even think about changing this particular covenant. I plan to talk with the state to see if we might be able to change some wording to maybe limit the rental to less than 30 day a year, or at least be able to clarify what this means. Section states "usage From time to time" maybe that can be clarified and be more specific. You have been most helpful in you responses. Thank you

Does it matter what type of HOA your are? ie: nonprofit mutual benefit corporation, Public benefit corporation or religious corporation? Just wondered if this might make a difference. I don't think so
but thought i would ask. I do agree that we would have to have 100% of the vote approved in order to make a change.

As I understand this, it protects current owners from changes, but the CCRs can be amended to restrict rentals for all future home buyers.

JeffT2, I think you are right, and I think this is important and relevant to the OP's situation. Good catch.

Please do, BettyT4. Not too many regular posters here from Montana. I think it's good to have people from a wide variety of states on here sharing their situations, problems, and solutions. Good luck to you.