Government has well and truly ﬂuffed the inquiry into short-stay letting
By: Jimmy Thomson
20 October 2016
Politicians should have to take an oath similar to the one often
attributed to doctors: “First do no harm.” Greens MP Jamie Parker
might want to add “be careful what you wish for” to the post-it notes
next to his computer screen.
For it was Parker who opened the can of worms that the parliamentary
inquiry into short-stay letting turned out to be. The Balmain state MP
was rightly concerned by reports that some of his constituents were
being threatened with $1m fines for letting rooms in their houses,
principally through online letting agency Airbnb.
And the subsequent Legislative Assembly inquiry into the “Adequacy of
the Regulation of Short-term Holiday Letting” would certainly relieve
that burden from home owners who want to make some pin money and
introduce holiday-makers to their Sydney.
If only that was all it recommended, it might be a fine thing.
However, it offered a chink of light to the multimillion-dollar online
letting industry, and its operatives have exploited that to the
As a result, if these proposals are ever made law, apartment blocks all
over the state will be thrown open to anyone and everyone who wants to
run holiday lets.
proposals in a new report are ever made law, apartment blocks will be
thrown open to anyone and everyone who wants to run holiday lets.
Our homes will become hotels, and the shared facilities we pay for will
be rented to complete strangers who neither know nor care about the
culture or standards of our buildings.
The report, tabled in Parliament this week, gets so many things wrong,
factually and attitudinally. It says strata schemes can’t ban
short-stay lets – citing NSW government advice—ignoring the fact that
strata schemes have been successfully excluding short-stay lets for
years in NSW, often by the simple expedient of passing by-laws invoking
their local zoning regulations.
Under these proposals, those protections will be swept away. This will
be a goldmine for the online letting agencies whose representatives’
hands must be black and blue from high-fiving each other.
But it seems our MPs have been duped by the grubby little lie that’s at
the very core of the “sharing economy” sales pitch. This is not about
Aunt Jessica renting out a spare room while she saves up for a hip
operation, or that she has some company too, now that Uncle Fred has
And it’s not about Josh and Patty paying off their student loans or
mortgage by renting the room that will house their children … as soon
as they can afford to have some.
Sixty per cent of Airbnb rentals in Sydney are for whole homes rather
than shared space. Almost 30 per cent of hosts have more than one
property. Agencies like Airtasker
have sprung up, where you can find someone to change the sheets, clean
the unit and hand over the keys so that the “host” never has to meet
This is big business and it’s getting bigger. There are 9800 whole
homes listed in Sydney alone – that’s the equivalent of almost 100
large high-rises that aren’t available to residential tenants.
Meanwhile they are competing with short-stay hosts for any half-decent
homes in popular areas.
How far is that from the image of the international hug-fest that these agencies present as their business model?
On the topic of the effect of short-stay lets on residential rents, the
report admits right up front that there is a lack of reliable data to
show cause and effect and, quite rightly, recommends there should be
studies into this.
But later on it goes on to downplay claims that there is a relationship
between short-stay lets and rental property shortages, again citing of
lack of data from councils that raised this issue.
Then, in the same section, this: “Proponents of [short term rental
accommodation], however, argued that a large number of property owners
are able to use the money they earn through the practice to ensure that
they are able to keep up with mortgage repayments.”
This comment was taken from a submission by Sharing Australia Inc, an
organisation of 10,000 Airbnb hosts committed to, in their own words,
enabling “home sharers to rent their spare room or whole
So local councils’ views can’t be trusted without data but a pro-Airbnb group can?
And let’s look at that statement in relation to the effect on housing
stock. If you are renting a room to help you pay your mortgage,
you are not affecting the residential accommodation market anyway,
because you’re not letting your whole home. D’uh!
This is not a criticism of Sharing Australia – they weren’t to know
that their mission statement would be taken out of context to support
the view that short-stay lets don’t affect housing affordability.
By the way, if you want some data, a recent study in Los Angeles shows
that short-stay rentals only need to be occupied for 83 days of the
year to make the same money as a residential let.
The problem they and other cities are facing is residential leases
running out at the start of the holiday season so that “hosts” can
double dip on rentals.
Another constant theme in the report was that there weren’t many
complaints about short-stay letting in strata blocks. That might
have been valid were it not for the erroneous statement that owners
corporations can’t prevent them.
In fact, we’ve been legitimately locking them out for years. OK,
we can’t have a by-law that says no short-term letting, per se.
But we can and do have by-laws that say the building adheres to its
zoning when it states it must be residential only.
Even buildings not zoned “residential only” are finding ways of dealing
with short-stay letting. And do you think the online rental agencies
wouldn’t have taken a test case to the Supreme Court by if strata
committees were breaking the law.
That’s one reason you haven’t had many complaints – we’ve got it under
control. At a recent seminar on the new strata laws, about 40 per cent
of owners said they had by-laws restricting short-stay lets.
And I will put money on it staying that way, even if the majority of
MPs fall for the pro-short-stay thrust of this report. As apartment
living has become part of the new normality in Australia we’ve been
working out how to manage our homes in a civilised manner.
Part of that is the ongoing education of residents, many of whom are
new to strata, that they can’t do whatever they want, whenever they
They can’t take glassware to the swimming pool because we have to drain
it if something breaks. They can’t come straight out of the pool into
the lifts, they can’t park wherever they feel like it and they can’t
party all night every night.
Eventually most people get it, and understand that it’s to our mutual
benefit. But friends on a footy trip, bridesmaids on a hens’ weekend
and families in holiday mode have less than zero interest in by-laws
and rules about behaviour.
So we’ve passed by-laws banning short-stay lets where we can, and where
we can’t, we’ve found inventive ways of keeping them out of our
buildings. This will not change, even if the law does.
One proposal in the report suggests that strata committees should be
able to take owners of units where there have been disruptive renters
to the tribunal. Stuff that for a game of soldiers.
If you force us to accept short-stay rentals where the vast majority of
owners don’t want them, we will find ways of making them untenable. You
want to “disrupt” the economy? We’ll show you disruption.
And as for the hosts, you’re the ones making all the money, so you can
take us to the tribunal. Waste your time because we ain’t wasting
Guerrilla warfare on the common property aside, the sheer lack of
concern, bordering on contempt for strata residents – owners and
renters – is breathtaking.
It suits the government to allow 75 per cent of owners to force the
other 25 per cent to sell their homes to developers. But the same
proportion of owners can’t decide they don’t want short-term lets in
A new by-law will allow you to limit the number of people living in an apartment, but not how long they are staying?
While just about every other city in the world is trying to roll back
the spread of short-stay letting, at least to reasonable levels, here
in Sydney we are prepared to destroy strata communities so that
individuals can line their pockets.
Ironically, the better job committees have done in maintaining
standards in their buildings the more attractive they will be to
opportunist investors. There are some very powerful people living in
strata who are not going to take kindly to their privacy and security
being compromised in this way.
The new regulation is really deregulation. It’s a
free-for-all. There was a chance here to come up with a plan that
suited most people, whether they were home-sharers or investors, pro
short-stay or against.
But it has been well and truly fluffed. The report is a blueprint for
disaster and should be consigned to the cross-cut shredder of history.
Oh, and spare a thought for Jamie Parker, having let the genie out of
the bottle, he apparently struggled manfully to put some protections in
place for strata schemes. I wonder if he’s ruefully thinking of
that other adage: “don’t fix it if it ain’t broke.”
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