Buyer beware. That’s advice a New York City couple could have used in 2017, when they bought a house in Eldred Township with the intent to use it as a short-term rental.

Things didn’t go their way when they appealed a cease-and-desist order from the township to stop using their property at 591 Frable Drive, Kunkletown, as a short-term rental. The Eldred Township Zoning Hearing Board ruled in favor of the township on Thursday night. It was the first challenge to the township’s short-term rental ordinance passed in 2020.

Joseph Hanyon, an attorney with MHK Attorneys representing Sebastian and Amanda Alappat, argued that the township knew the property’s previous owners used it as a residence with a business and then a short-term rental before it was sold to his clients.

Sebastian Alappat said he found the house when he rented it with friends as a short-term rental. When he and his wife decided to buy it, they said they were told by the previous owners, Robert Syracuse and his former wife, Lori, as well as the real estate agent that the house could be rented as a short-term rental. They said they didn’t know the use was not allowed, but they didn’t contact the township either.

At that time, Eldred Township had not passed the ordinance. It did, however, have an ordinance in 2004 under Health and Safety and an amendment in 2014 that addressed structures and uses permitted in a residential area and other zoning districts. The short-term rental ordinance in 2020 was another amendment.

“If they appropriately were renting their property in a residential zone in a short-term basis prior to the enactment of the 2020 laws, they would have a preexisting nonconforming use,” Hanyon said.

Eldred Township zoning officer Shawn McGlynn disagreed, saying it wasn’t a preexisting condition, because the use wasn’t lawful before the Alappats purchased it.

Although short-term rentals were not mentioned, hotels and bed-and-breakfast establishments were.

Township solicitor Michael Gaul said hotels are not allowed in residential or industrial areas. A B&B is allowed with a permit, but the owner of the house has to live on the property. Owners of short-term rentals do not live on their properties, and as in this case, they don’t live in the same state.

The 2020 ordinance requires that short-term rentals in Eldred Township have a manager who lives nearby.

“Just because you own a home doesn’t mean you can rent it,” Gaul said.

The 2020 ordinance also requires that anyone who wants to operate a short-term rental in the township request a certificate of special exception and come before the board of supervisors for a conditional use hearing. If the supervisors grant the request, then the owner pays for a permit.

Hanyon argued that in addition to preexisting condition, the zoning board should also consider variance by estoppel. This type of variance places the wrong on the township. In this case, it would be saying the township should have contacted all the owners of short-term rentals and informed them of the ordinance and how to resolve the situation.

Gaul disagreed and said the township would object to a variance by estoppel.

“Critical to that is that the township is somehow being involved in the problem, and there’s no testimony here today that the township did anything wrong,” he said. “There’s lots of stuff that happens in townships that the township just doesn’t know about.”

Gaul argued that it is time consuming to figure out which properties are being used as short-term rentals, and it would be expensive to hire someone to do the research.

The township has one full-time office employee - a secretary. The treasurer is part-time, and the zoning officer is not a township employee. Gaul works for a firm that has a contract with the township.

“They try to do what’s reasonable, and there’s no testimony that somehow the township aggravated the problem,” Gaul said. “Sending a notice, after getting a complaint from a neighbor that you’re not supposed to be doing this, that’s not overbearing either.”

McGlynn, the zoning officer, said, “My staff is not directed to search for listings before a complaint is given. … My belief is it is a waste of time to search for them without a complaint.”

The Alappats said they bought the house for $435,000 and have spent about $80,000 in renovations. They anticipate that they will lose about $100,000 per year in gross income if the house cannot be used as a short-term rental.