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Strata Corps can’t stop Airbnb

Airbnb is one of the biggest sharing economy successful stories but not everyone is happy with its achievements. 

First up, there’s the various State Governments, which are missing out on council rates from residential properties operating – more or less – like businesses but not paying their way. Airbnb

When it comes to apartment blocks, other owners and tenants also aren’t overly keen to have a revolving door of people staying in their complexes.

Their annoyance probably reaches its crescendo about 2am on a Sunday morning when those visitors loudly stumble back to their short-term accommodation after sampling the night-life.

Landlords are also not happy because more and more of their tenants are subletting their properties on the site without their consent or knowledge.

Grey areas

Here’s the thing: Legislation is struggling to keep up with the rapid evolution of Airbnb. 

Metropole Property Management

Apart from standard tenancy legislation which outlines what a tenant can and can’t do with a property, there have been other attempts to govern Airbnb’s ubiquity – with varying degrees of success.

In fact, a recent judgment by New South Wales Fair Trading has highlighted the “greyness” of what’s allowed and what’s not.

According to media reports, strata or owners corporate by-laws seeking to impose short-term letting restrictions in Sydney apartments complexes are invalid.

Why is that?

Well, Fair Trading reportedly says that only local councils have the necessary authority to take such steps.

The government department has updated its “Strata Living” handbook to warn committees that passing by-laws constraining holiday letting is not on.

“Section 139 (2) of the Strata Schemes Management Act 2015 states that no by-law can prohibit or restrict the devolution of a lot or a transfer, lease, mortgage or other dealing relating to a lot,” a Fair Trading spokesperson reportedly said.

But this is about to change

Well…at least in New South Wales were recently the NSW Minister for Innovation & Better Regulation Matt Kean and NSW Minister for Planning, Housing and Special Minister of State Anthony Roberts, announced reforms for Greater Sydney for investors who short-term let out their properties on platforms like Airbnb.

Short-term holiday letting is currently unregulated in NSW.

The soon to be introduced new planning laws will impose a 180-day cap on the number of days empty properties can be rented out by Airbnb in Greater Sydney.

Councils outside greater Sydney will have the power to impose their own caps, no lower than 180 days per year.

In a move that will please many owner occupiers who live in apartments, strata corporations will have the power to ban Airbnb in their buildings if 75 percent of owners agree to pass appropriate by laws.

Interestingly the proposed reforms will not give Strata Committees the power to prevent owner-occupiers from renting rooms within their units.Strata Can Not Stop Airbnb 2

The emphasis of the 180 days/year limit, according to Mr Roberts, is roughly the amount of weekends, school holidays and public holidays in any given year, and claims it is “a fair and balanced approach.”

“Councils outside Greater Sydney can decide if permitting short-term holiday letting for the entire year is acceptable for their local communities. This recognises the importance of tourism in some regional communities,” Mr Roberts said.

The 180-night limit imposed by the government is far bigger than most had expected and is arguably very generous compared to other major cities around the world.

It’s a model Airbnb was quick to champion, saying it could be replicated elsewhere.

The rules were also not as strict as many had call for – to give apartment buildings the power to ban Airbnb altogether.

While it is possible that other States may follow the Harbour City’s lead, at present Airbnb is unregulated around the rest of Australia.

In the meantime..

Investors could do worse than ensuring they have professional property managers who are going to be their eyes and ears.

And who probably can spot Airbnb guests from a mile away by the unusually large numbers of suitcases in the hallway of your residentially leased apartment.

You may also want to read: Airbnb: Landlord rights and responsibilities

 

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About

Leanne is National Director of Property Management at Metropole and a Property Professional in every sense of the word. With 20 years' experience in real estate, Leanne brings a wealth of knowledge and experience to maximise returns and minimise stress for their clients. Visit: www.metropolepropertymanagement.com.au


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