Sunday, February 17, 2019

Get smart about short-term letting or risk “disastrous impact”, warns accom chief

Regulation of Sydney’s commercial short-term accommodation sector doesn’t have to be difficult, says Tourism Accommodation Australia CEO Carol Giuseppi. 

It is basically all about common-sense.

You can have genuine home sharing, and you can also have balanced regulation which protects the rights of everyone else.

Luckily, the State Government has before it the examples of international cities where action has been taken to regulate companies like Airbnb, protecting housing availability and affordability in those cities (not to mention hotel investment and jobs), while also protecting the rights of actual home sharers.

The battle has already been fought, the lesson has been learnt, in cities around the world.

Amsterdam, San Francisco, New Orleans, London, New York, Miami, Boston, Vancouver, Montreal, Toronto, Madrid and Dublin are all examples of cities which have recently enacted or proposed limits of 90 days or less and registration on short-term commercial letting.

Sydney just needs to do the same.

Think about it for a minute. The reality is if you are renting out your home for more than three months of the year, it is not your actual home – it is an investment property. And it is often located in a large apartment complex next door to neighbours who actually live on the premises and should have a right to a quiet and peaceful existence – after all, they didn’t sign on to live in a hotel!

Tourism Accommodation Australia has no issue with genuine home sharing, the ‘mums and dads’ renting out a spare room, or their home for a few weeks while they take a trip overseas.

We do have real concerns, however, with the growth of quasi-hotels operating commercially across the city without any of the controls required of our industry – important things like insurance; fire and safety provisions; security; liquor licensing, taxation and employment under Fair Work.

With regulation must come proper controls including registration, nightly limits and we would also support strata controls.

We also have real concerns with the rapid commercialisation of a sector portrayed by the start-ups as just people renting out their own home, when in fact the figures tell you something completely different.

Almost one in every three Airbnb properties (32%) in the Sydney market is already currently full-time commercial accommodation.

These are properties no longer available for the long-term rental market – commercial operations or basically quasi-hotels, sitting empty until the next load of party-goers arrive.

When you have examples like one host with 252 active listings earning $3.8million last year, and another with 182 active listings earning $2.1million, it should be obvious commercial operations are taking place.

Imagine what will happen if the Government now regulates to allow 180 days or more? The hint is in the words “investment property” – it is a commercial investment where people are looking for the best return. That is why they have it. It is not a ‘home’.

A wrong move by the Government would have a disastrous impact on long-term rentals. Many of Sydney’s residential apartment blocks would turn permanently into quasi-hotels with the associated problems with party-going holiday makers.

There are extensive reports linking the prevalence of short-term letting to decreased housing and rental affordability, including a recent University of Sydney report which found the relevant indicators ‘suggest that Airbnb rentals are likely to create upward pressure on Sydney’s rents’. Strata committees around Sydney have been left powerless in the face of the Airbnb juggernaut.

Investment properties originally designed for residential purposes and paying residential rates –  with none of the regulations required by hotels – cannot be permitted to operate as quasi-hotels with limited or no controls.

The Government needs to show the community it’s serious about supporting jobs and investment.

The accommodation sector in NSW employs 56,000 direct and indirect employees and pays $400 million in taxation – maybe the Government needs to ask itself how many people Airbnb genuinely employs and how much they pay in tax?

About Carol Giuseppi

Carol Giuseppi is CEO of Tourism Accommodation Australia

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One comment

  1. And this hits places like Byron Bay even harder where there is already NO SPACE left for residents. Some areas in Byron Bay has zero locals left – 100% illegal STHL – nobody can afford housing – house prices are sky rocketing as people buy with STHL / AirBnb in mind. Where do the workers live? Legal accommodation places suffer and have to close as the playing field is not level – STHL / AirBnB pay no GST, no commercial rates, neighbours can’t complain when DAs are lodged as there is no Development Application …

    This must stop! This is destroying communities, holiday destinations all over the world. Australian politicians: pull your finger out.

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