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Airbnb Shakeup Threatens Local Businesses

Mar 19, 2024

The NSW government has short-term rental accommodation in its sights, posing a threat to the local tourism industry and economy. The Minns’ government is considering major changes to rules and regulations governing short-term rental accommodations, including platforms like Airbnb and Stayz.

The proposed changes include regulatory and revenue measures, including higher registration fees, more stringent approval requirements, and limits on the number of nights a property can be let for non-hosted short-term rental accommodations. Additionally, revenue measures include levies on booking revenues and day fees per guest staying in short-term rental accommodation.

Housing MInister Rose Jackson said the current regulatory framework for short-term accommodation in NSW as “purposely light touch” and that every part of the housing market would be “under the microscope”.

“This review will inform our approach to make better use of all forms of housing, including short-term rentals, vacant property and holiday homes.

“This includes looking at ways to move some of this housing to the long-term rental market and to minimise its negative impacts on the housing market as well as what we can do to support homelessness services across NSW,” Jackson said last month.

Local businesswoman Fiona Germaine highlighted the potential financial burdens these changes could impose. “State government proposals, including additional accommodation taxes and caps on short-term rental accommodations, could mean the end of short-term accommodation for Hawkesbury, with businesses facing substantial taxes,” Germaine said

One of the key proposals under discussion, involves capping the number of nights a property can be used for short-term accommodation. For instance, in the Byron Bay local government area, the limit is just 60 nights per year, while in certain parts of greater Sydney, hosts may only rent out their properties for 180 nights annually.

The government wants to generate revenue and sees placing restrictions on short term accommodation as part of the solution to the escalating housing crisis. Hosts argue that many short-term rental properties are not suitable for long-term rentals. They fear that restrictions on hosting durations, or the number of properties available for short-term rentals within an area, could jeopardise tourism and the economic benefits it brings.

The Bells Line Road Business Council (BLRBC), will discuss the planned changes at a meeting tonight. It says these changes could imperil numerous small and micro businesses reliant on the overnight stay tourism economy.

Susan Wheeldon, Airbnb’s country manager for Australia and New Zealand, said platforms such as Airbnb had become essential to many local economies. “Hosting is an economic lifeline for many amidst a cost of living crisis,” Wheeldon said, citing a recent study indicating the financial support Airbnb provides to hosts.

Although Airbnb and Stayz are open to supporting a short-term rental tax similar to one in Victoria, they oppose several other proposed measures. They argue that such measures should also apply to hotels and not just short-term rental accommodations.

A report funded by Airbnb highlighted the sector’s minor impact on Australia’s housing market. 

“Airbnb currently represents between 1 and 2 percent of total dwelling stock in Australia and in more than 90% of local government areas (LGAs), represents 5% or less of total dwellings. And further, less than 3% of local government areas have non-hosted STRA at levels equal to at least 10% of total dwelling stock,” the report said. It added that In 2022, guests on Airbnb spent over $12 billion in Australia and contributed $13.6 billion to GDP, whilst supporting over 90,000 jobs.

Anyone impacted by the changes or interested in the matter can attend the Bells Line Road Business Council forum tonight at 6.30pm at the Archibald Hotel, Kurrajong.

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