City Hub

Councils roll out the red carpet (and some red tape) for AirBNB

AirBNB at San Francisco Pride. Photo: Quinn Dombrowski



Sydney Councils are moving to embrace the sharing economy around short-term accommodation sites such as AirBNB.

Government and the law has been slow to catch up to the lightening pace of innovation of the sharing economy. Australia was the second largest market for AirBnB behind the United States in 2012 when the company opened its Sydney office.

Now the state government is holding a NSW Parliamentary Inquiry into short term accommodation letting.

In the intervening years, accommodation letting has been a grey area, punctuated by confusion.

In September last year a Randwick resident was told she could be liable for more than $1 million dollars for operating an “unauthorised” bed and breakfast.

In a development that only served to further highlight the confusion around such rentals, Randwick Council subsequently concluded the short-term stays were a “lawful ancillary use” of the woman’s home.

The City of Sydney is advocated for adoption of laws to regulate accommodation rentals and the sharing economy.

Lord Mayor Clover Moore said that sharing rooms would stimulate local communities as well as local economies.

The City of Sydney advocated for short term letting in the NSW inquiry,  “so long as neighbouring properties and traditional visitor accommodation services are not adversely affected”.

“Tech companies are providing increasingly efficient means for offering homes and spare rooms for short-term holiday letting but our laws have not kept pace,” Lord Mayor Clover Moore told City Hub.

“With the right rules, short-term holiday letting can support local communities and economies, while protecting amenity and the residential character of our villages.”

The submission admitted that local legislation had not kept pace with the rapidly expanding services like Airbnb, which fall under what is widely called the ‘sharing economy’.

Sydney’s Airbnb listings have doubled to 15,000 in the past year.

Listings fall under the jurisdiction of individual councils, which in many cases have complex of ill-defined guidelines in place.

But that could be about to change. Currently residents in councils including Sydney, Woollahra and Randwick have had to apply to become bed and breakfasts – a potentially expensive exercise.

A  Woollahra council spokesperson told City Hub planning permission had to be granted and a DA submitted if an individual wanted to rent their apartment or house short term.

“When assessing applications we consider the need for balance between supporting the interests of property owners and ensuring there is no negative impact to surrounding residents and businesses,” the spokesperson said.

Yet, this may be about to change if the City of Sydney has its way, with plans for a state-wide approach to regulating such rentals.

Under the councils’ proposal, a property would be exempt if the number of guests and the number of days a year they stay is limited.

If short-term letting does not meet the requirements it would not be permitted.

The submission stressed the need to balance the demand for short term rentals “against the reasonable expectations of neighbourhood amenity and visitor safety”.

Airbnb did not respond in time for this publication, but have previously welcomed the proposal.

They said the rules are “often hard to interpret and out-dated”.

Airbnb’s own terms of service recommend that its users familiarize themselves aware of the regulatory and legal regimes in which they operate.

“Local governments vary greatly in how they enforce these laws,” it reads.

In their submission to the NSW Government in 2014, Airbnb remarked on the lack of regulatory response to their business model.

“The planning treatment of short term stays in residential properties therefore seems to fall within an uncertain grey area,” the submission read.

“We see merit in codifying the treatment of short term rentals on a State-wide basis without facing the uncertainty of potential punitive action.”

Yet, despite recent headlines of horror tenants councils who spoke to City Hub said they received very few complaints about short-term rentals.

“We are only aware of one complaint to Council from neighbors who have been adversely impacted by Airbnb rentals,” said a spokesperson for Woollahra Council.

The City of Sydney isn’t the only council seeking to move to take advantage of the growth of services like Airbnb. Coastal NSW councils, including Gosford, Pittwater, Shoalhaven and Kiama Councils have all recently given short-term rentals the go ahead.

A paper released by the NSW Government in January found the “sharing economy” was worth $504 million to NSW.

Waverley Council was considering making a submission to the inquiry. A council spokesperson said they had not received many complaints.


CAPTION: AirBnB in San Francisco Pride March. Source: Quinn Dombrowski

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