Barriers are going up across Australia in an effort to curb the out-of-control spread of illegal holiday lets, with both NSW and now WA considering strata scheme by-law bans, mandatory registers and strict fire safety measures.
A combination of any of these measures is likely to halt the rapid spread of residential homes being converted to holiday lets that has turned central Melbourne apartment blocks into a free-for-all for visiting football fans, concert-goers and bucks nights.
Submissions to the NSW government’s consideration of new holiday letting rules closed earlier this month. But this week the WA parliament released its own report into controls to curb illegal holiday lets.
FYI, in many areas these holiday lets are illegal because they contravene council planning laws. The fact that some local councils can’t cope with the numbers of illegal lets – even if they want to – doesn’t make them legal.
The proposals from the WA parliament’s Economics and Industry Standing Committee, titled Levelling The Playing Field – Managing the impact of the rapid increase of Short-Term Rentals in Western Australia are similar to the current moves under consideration in NSW – although some go a little further, and others are less extensive.
For instance, the WA proposals suggest a register along the lines, it seems, of the Japanese model where hosts must acquire a serial number without which their properties can’t be listed.
When a similar measure was instituted in Japan last year, Airbnb listings dropped by 80 per cent. WA is currently estimated to have more than 20,000 properties listed on Airbnb. The great majority of them whole homes.
The ten key recommendations (below) in the WA report seem a long way from the notorious Coure report that led the NSW government up many blind alleys and almost let to a similar free-for-all that is currently destroying strata communities in Melbourne.
This weekend, one of the busiest in the year for Melbourne due the AFL Grand Final, sees a luxury three-bedroom flat being offered to eight occupants for just over $1500, while another offers 10 beds in three bedrooms for $2960.
Interestingly, both of these would fall foul of proposed restrictions in NSW that theoretically limits lets to two adults per bedroom (I say theoretically because who’s going to count the number of bodies in the flat once the keys have been handed over?)
No doubt with the benefit of having watched the various stutters and stumbles in other states, WA legislators have been able to consider what will work and what won’t as they try to balance the rights of strata owners, genuine bed and breakfast operators who are controlled by stringent laws, hotel and resort companies and opportunist property speculators … not to mention the tourist trade as a whole.
And we shouldn’t forget that it was the High Court in WA that first punched a hole in the “not interfering” argument that was tried and ultimately failed to block holiday letting bans in NSW apartment blocks.
Among the proposals are recommendations that prospective buyers be informed that apartments in their block are being marketed as potential Airbnb lets.
That zoning laws be amended to define whether properties can be used for genuine sharing (with hosts in situ) or whole home holiday lets.
The introduction of model by-laws that would either allow or ban holiday lets, the introduction of a mandatory registration scheme and that holiday letting platforms be required to pass on data about the usage of properties under their listings.
Here are the 10 key proposals extracted from the WA report (which makes interesting reading in its entirety).
KEY RECOMMENDATIONS FROM THE WA REPORT
1. A public education campaign to make owners, real estate agents, property managers and purchasers of real estate in Western Australia aware of their obligations in regard to:
- the truthful marketing and presentation of properties as Short-Term Rental prospects;
- the importance of considering Short-Term Rental as part of the pre-purchase due diligence process; and
- other legal obligations surrounding the use of properties as Short-Term Rentals.
2. That by June 2020 the Minister for Planning update the model provisions in the Planning and Development (Local Planning Schemes) Regulations 2015 to amend:
- land use definitions to differentiate between hosted and unhosted Short-Term Rentals;
- land use definitions to include the size and capacity of Short-Term Rentals; and
- the definition of bed and breakfast accommodation.
3. That by June 2020 the Minister for Planning direct the Western Australian Planning Commission to update planning guidance so that it aligns with the amended land use definitions in the Planning and Development (Local Planning Schemes) Regulations 2015 and provides greater guidance to local governments about ways to appropriately regulate ShortTerm Rentals.
4. The Minister for Planning direct the relevant government agency to work with stakeholders to develop model by-laws that assist strata companies (the WA term for owners corporations or bodies corporate) to better manage Short-Term Rentals in their strata scheme. These model by-laws should include:
- by-laws that, if adopted by a strata company (owners corporation), would prevent owners from letting their lots as Short-Term Rentals; and
- by-laws that, if adopted by a strata company, would enable owners to let their lots as Short-Term Rentals.
5. The Minister for Planning direct Landgate to update their strata titles guidance to include discussion of the powers and processes open to strata companies to manage Short-Term Rentals in strata schemes.
6. The Ministers for Commerce, Local Government, Planning and Tourism establish an interdepartmental working group to coordinate whole-of-government policy responses for Short-Stay Accommodation.
7. The interdepartmental working group should:
I Establish the baseline requirements for a state-wide registration scheme, including:
- the minimum information required for both hosted and unhosted premises;
- the cycle of registration;
- registration costs for the State register (separate from any additional local government fees, charges or costs);
- the most appropriate agency to hold the register; and
- the treatment of Traditional Accommodation providers
II. Determine the legal mechanisms through which the State Government can introduce and enforce a registration scheme, including consequences for non-compliance.
III. Determine the most appropriate mechanism to collect and manage the registration data.
IV. Determine the information disclosure requirements for online platforms and appropriate enforcement mechanisms.
V. Determine information sharing mechanisms between State and local government authorities, including information gathered under existing registration and licensing regimes for Traditional Accommodation.
VI. Determine what information, if any, should be made publicly available.
VII. Ensure that local governments maintain the ability to require the provision of additional information and impose additional licensing or operational requirements, depending on their particular circumstances. The interdepartmental working group’s activities should incorporate appropriate consultation mechanisms with local government authorities and relevant stakeholders.
8. The relevant Minister should ensure, through appropriate legislative or regulatory mechanisms, that online platforms are required to display a valid registration number for Short-Term Rentals, issued under the registration scheme. The interdepartmental working group should consider and provide advice to the Minister on the appropriate requirements for Traditional Accommodation.
9. The relevant Minister prepare regulations requiring online platforms to provide data on all Short-Term Rental properties listed in Western Australia to the government agency with primary responsibility for the state-wide registration system, on a disclosure cycle to be recommended by the interdepartmental working group.
10. The relevant Minister introduce a state-wide registration scheme for Short-Term Rentals based on the parameters developed by the interdepartmental working group, coupled with data provision requirements for online platforms. Local government authorities should be responsible for:
- approving additional registration requirements for properties within their boundaries;
- developing additional registration criteria, suited to their particular circumstance;
- enforcing compliance with their local controls;
- managing complaints about Short-Term Rentals; and
- setting and imposing penalties for non-compliance with local requirements. The process for information collection and disclosure should be developed by the interdepartmental working group, in consultation with local government.