Letting out your apartment as short term rental accommodation is a fantastic way to make some extra cash. And with websites like AirBNB dominating the market, it’s easier than ever to find tourists and holiday makers who are looking for a place to stay. But, where does this leave you with strata management? Or as an owner occupier neighbouring short-stay rentals, what are your rights?
What is the new legislation?
Until recently, it has been difficult for a local council to regulate these kinds of rentals as the Environmental Planning and Assessment Act 1979 covers tourist accommodation such as hotels but doesn’t explicitly reference short-term holiday letting services like AirBnB. On the 5th of June 2018 however, the NSW Government revealed new legislation which is set to have a big impact on strata inhabitants and short-stay companies.
Under the new laws, hosts within the Greater Sydney area will only be able to rent out their home for up to 180 days per year. Regional councils outside Greater Sydney are able to impose their own limits as long as they are a minimum of 180 days a year.
In addition to the new strata law, short term stay operators must sign the new Holiday Rental Code of Conduct. This will address issues like disruptive guests, noise levels, and damage to property. Under this agreement, guests or hosts who commit two serious breaches of the code within two years will be banned from short-term holiday platforms for five years. Individuals in breach of the code could face fines up to $220,000 whilst business could have to pay up to $1.1million.
NSW Fair Trading will also have new powers and abilities to enforce these regulations. Under the new laws, they will be able to appoint independent adjudicators to assess complaints against the code, police online platforms & letting agents and maintain a register of ‘strikes’ against offending parties.
Can strata ban short-term holiday letting in your building?
Yes. Under the new NSW strata laws, the owners corporation has the right to ban the use of Airbnb in the building if the owner does not live in the unit and at least 75% of the owners agree to pass the appropriate by-laws.
This means that owner-occupiers who use the unit as their principal place of residence but occasionally want to put their home up for short-term rental while they are away can do so but investors who buy an apartment purely to list it on Airbnb or rental tenants who are illegally subletting are prohibited.
What should you do next?