Supreme Court: Homeowners Association Cannot Restrict Airbnb
About a month ago, the Czech Supreme Court ruled that an SVJ (homeowners' association) cannot ban or restrict Airbnb operations within its bylaws.
SVJ cannot restrict Airbnb
The Czech Supreme Court ruled that homeowners' associations cannot use their bylaws to restrict unit owners from short-term renting their apartments.
The Court stated that bylaws must stay within the scope of the association's competencies, which cover the management, operation, maintenance, and repair of the building, its common areas, and land. Bylaws are the foundational document governing the association's internal affairs — members' right to attend meetings, vote, stand for election, and bear liability for debts.
Bylaws cannot be used to restrict the property rights of apartment unit owners regarding how they use their flat, even when it is used to accommodate tourists.
"If the homeowners' association general meeting restricts property rights through its bylaws, that constitutes a decision that falls outside this body's authority."
How it started
The ruling stems from a dispute within a homeowners' association in a building in Praha 1. Co-owners tried to ban a neighbour from short-term rentals by amending the bylaws to require unanimous consent from all SVJ members.
The owner filed suit with the Municipal Court in Prague but lost at first instance. The court sided with the homeowners' association, holding that restricting an owner who exercises their rights in a way that negatively affects others is not contrary to law.
The owner appealed and prevailed at the High Court. The Czech Supreme Court then dismissed the SVJ's appeal. Both the High Court and the Supreme Court noted alternative remedies for addressing disturbances to quiet and order.
What this means
The ruling is good news for short-term rental operators — homeowners' associations cannot override the property rights of apartment owners. That said, numerous proposals to restrict or outright ban accommodation services in residential flats remain on the table.
The decision does not resolve the fundamental challenge of ensuring peaceful coexistence between residents and guests. It is up to operators to do everything possible to ensure their guests do not disturb neighbours. Effective tools exist for running a non-disruptive Airbnb and reaching a win-win with the building's residents.
This article was prepared by the Investerra team. We manage 130 apartments in Prague since 2007 – with over 45,000 guest reviews on Airbnb and Booking.com and returns of 5–12% per year for property owners.
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