Short Term Holiday Letting

The swift rise of the shared economy has been subject to much examination and debate across sectors and the property industry is no different.
The increase over time of Short Term Holiday Letting (STHL) practices has generated two competing narratives. On one hand is the suggestion that STHL is being used to bypass established and necessary safety and accessibility regulations of the National Construction Code. On the other is the economic benefits and customer needs that can be provided for by good practises of STHL.
The Property Council views the current regulatory approach as fragmented and incomplete. STHL must be defined at a state-level to avoid the chequered approach currently being led by local governments to fill a perceived regulatory void. This will provide much needed clarity to owners, customers, and other relevant stakeholders such as insurers.
The Property Council believes there needs to be greater regulatory oversight and supports the introduction of registration and a licensing system to allow planning regulators and the government to accurately quantify the supply of short-term leases and make informed policy decisions. It will also allow compliance activities to be carried out against poor operators.
STHL is often used by home owners as a means to supplement income by letting a whole property on a sporadic basis. However, when STHL is run commercially in a dedicated property throughout the year, it could be seen to circumvent established regulations imposed on short term accommodation operators. This is not acceptable. As such, the Property Council recommends that the NSW government limit the use of residential housing for commercial purposes. A non-primary dwelling should only be eligible to be rented out on a short-term basis while the registered host is not present for a maximum of 90 days per year.
The use of STHL in strata-titled properties presents particular issues due to the proximity of residences to each other. Noise disturbances and damage to shared amenities are common complaints put forward by strata residents and owners. The Property Council recommends that the NSW Government amend strata regulations to give owners corporations more powers to manage and respond to adverse behaviour resulting from short-term letting in their buildings.
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