Legislative Report defends Airbnb!

Andrew Grima

Assisted by Holly Pitt

Chances are, if you haven’t heard of Airbnb by now, you’re well overdue for a holiday. Hundreds of Aussies and countless more travellers are taking advantage of the popular online marketplace to organise short-term rental homestays. 

Accommodation costs, rules and requirements can be set by the property owner who can communicate with prospective renters online, as they search for their perfect accommodation style.

It sounds straightforward on paper but like most things, it’s not as complication free as it would appear, largely because no-one is quite sure where Airbnb sits at the moment in regards to property legislation.

While classed as a short-term rental, in reality many homeowners have their property listed permanently which is wreaking havoc with strata laws, goodwill between neighbours and much more.

There is a distinct lack of uniformity amongst NSW Councils. For example, the City of Sydney Council has affirmed that short-term rental accommodation is tourist accommodation, and as such, is banned in the majority of residential areas across the city.

As it stands currently, homeowners looking to make a bit of extra money, risk hefty fines from their local council if they are found to be renting out accommodation to visitors on platforms like Airbnb.

With so much tension between Airbnb users and local councils, there has been a call to address the lack of uniformity in regulation regarding this type of accommodation. There is particular emphasis on a desire to prevent “party houses,” the houses or short-term accommodation that result in noise complaints disrupting usually quiet communities. However, the push for the right regulations could allow for the successful control of Airbnb accommodation across NSW.

In light of this recent discussion, the Legislative Assembly Committee on Environment and Planning has spent 18 months reviewing the home sharing and short-term stay industry, and has produced a report entitled ‘Adequacy of the regulation of short-term holiday letting in New South Wales’. 

This report concluded that short-term stay rental accommodation should be better defined in New South Wales, but also permitted. The Report concluded that banning short-term rental accommodation was not the best solution to address the problems associated with this style of accommodation, rather it suggested better regulation and more legislation around home-sharing.

The legal implications of a ban on short-term accommodation could include fines in the first instance. Some tenants may also run the risk of eviction by their landlord if they sub-lease their apartment without the consent of the landlord.

Airbnb and other home-sharing services can also run into hot water with the Australian Taxation Office, as this kind of “commercial arrangement” can be used to evade tax including Capital Gains Tax and GST. Income earned from accommodation for short-term holiday rentals must be declared.

View the report and inquiry materials.

The NSW Government is set to respond to the Committee’s Report and recommendations in April of this year.

For more information, please contact our Property Law team in Parramatta and Norwest:

Andrew Grima, Principal
Phone: +61 2 9895 9271
Email: agrima@colemangreig.com.au 

 

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