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The NSW Labor party is likely to introduce compulsory registrations of Airbnb-style short-term holiday lets (STHL), if it wins power at next year’s state election. And that could see STHL numbers drop by half, if not more, if the effect of registrations in other major cities are a guide.
NSW Government Opposition shadow minister for innovation and better regulation Yasmin Catley says registration for the short-term lets industry has “my absolute support” and will be introduced if Labor wins the next election.
“Registration is a scheme that is good for everyone – both the person letting out a property and the consumer, who’ll have confidence that everything is in place,” she says. “I just think it’s best practice to have a registration system for something like this, and you need the kind of data it will give us to make informed decisions.”
Airbnb is finding itself increasingly isolated as pretty much the only short-term holiday lets system still arguing against the need for a register of property-owners and head tenants who are renting out their apartments.
Rival HomeAway, formerly Stayz, is leading the way in supporting compulsory registration, also arguing for the creation of a code of conduct for owners and managers, and a largely industry-funded body to administer the process.
The revelation comes as the Sydney Morning Herald’s Domain reports that Sydney is lagging behind other world cities in its regulation of short-term holiday lets, which a growing chorus of industry experts claim is putting lives at risk.
While other popular tourist destinations like London, Paris, San Francisco, Vancouver, Toronto and Amsterdam have introduced a compulsory registration system for short-term let properties, the NSW Government blocked the measure for its own proposed legislation.
That means, for instance, that there’s no way of checking that short-term lets comply with appropriate fire safety standards, particularly if they’re in medium-rise apartment buildings under 25 metres tall where there’s no legal requirement for fire sprinkler systems.
“I’ve heard some horror stories of near-miss tragedies where people have been smoking where they shouldn’t be and started a small fire that forced evacuations,” says Reuben Schwartz, COO of BnbGuard which monitors short-term lets.
“But without a register of which apartments are being let on short-term platforms, it’s not possible to monitor them. Those units might not have sprinkler systems, and the short-term holidaymakers are unlikely to know where, say, the emergency exits or fire extinguishers are.
“It’s only a matter of time before something serious happens because the industry is exploding, and it’s a bit of a Wild West out there now.”
Local Government NSW (LGNSW), the peak body for local government in NSW, is also lobbying for a registration system to be introduced, on some of the same concerns.
“Councils are responsible for monitoring the fire compliance of premises generally, and with short-term lets there’s always the image of overcrowding,” says president Linda Scott. “That’s a very big problem.
“A registration system would help us keep a closer eye on those properties that are registered so we could better assess the risks.”
Fire experts agree that if there are more people staying in apartments than expected, that can be a danger. Fire Protection Association of Australia deputy CEO Matthew Wright says, “Evacuation is part of a fire protection strategy, and when that’s developed for a building, and numbers change, that can have an impact.”
Already, many other major cities with growing proportions of homes used for Airbnb-style holiday lets – leading to rising rents and reduced availability – have introduced registration systems. Others now introducing them, as parts of new rules packages, like New York and Boston, are being challenged with legal action by Airbnb which says such new laws violate users’ privacy and constitutional rights.
Airbnb lost a similar action in San Francisco against a registration system and subsequently saw its number of listings plummet by nearly half. It’s believed that many of the listings were removed because they were either illegal, or the home-owners had been evading tax.
In Sydney, Airbnb’s head of public policy ANZ Brent Thomas said the organisation was against registration.
“Government should make it easier – not harder – for families to earn extra income and ease the cost-of-living,” he says. “The evidence is people don’t want more red tape, like extremely complicated and costly registration, which would only make home sharing and travel harder and more expensive for local families.
“People should not be forced to navigate onerous red tape to simply share part or all of their own home.”
But the peak body for apartment owners, the Owners Corporation Network (OCN), is also pressing for a registration system. “It’s extraordinary that such a large number of the industry, including main players, want registration, but it’s surprising that in NSW it isn’t happening,” says OCN board member Jane Hearn.
“In areas of Victoria like the Mornington Peninsula, there’s registration and I believe Tasmania is moving that way too. How can you monitor and enforce regulatory standards when we don’t know which properties are being used for short-term lets?”
The Government has so far resisted all calls for registration, rejecting an amendment to its short-term letting legislation in Parliament to include it as a compulsory item, saying just that it might be introduced at a later date. The new laws include a 180-day cap on lets and a Code of Conduct which hasn’t yet been outlined.
“But how can you even start to think about trying to police the 180 days if there’s no registration system to monitor it?” argues LGNSW’s Ms Scott.
Mr Schwarz of BnbGuard says registration would also be a way of distinguishing between mum and dads doing holiday lettings and investors setting up commercial businesses. “And with registration, you could then decide to restrict activity in certain areas, like where 10 per cent of homes are already holiday-let,” he says.
While this is all very interesting, and Airbnb will fight this should either party suggest it, it will be the maintenance and overview of the register that will see the real battle erupt.
Almost everywhere that Airbnb hosts have been required to register their properties, the company has fought tooth and nail to avoid revealing the true identities of its hosts and their properties.
Airbnb cite privacy as their concern. Of course, if they were really concerned about privacy, they might give some thought to apartment owners being encouraged to invite complete strangers to share buildings with residents.
But no, the legal arguments they have run in various cities in the USA have been about people being able to make money without anyone else – in some places including the tax man and local authorities – being told about it.
Why? Cynics might point to the probability that we would, for the first time, see the true extent of Airbnb usage in the popular areas of our cities. And, it might reveal how many properties are being let in contravention of strata by-laws and state laws. And it would reveal the people who’ve been making a motza, tax free, at our expense.
Certainly, that saw a halving of listings in Los Angeles and is expected to affect them even more in New York where rental laws are even stricter.
It’s funny how this global monolith is so anxious to defend privacy laws, but less keen on accepting the planning laws and by-laws that are supposed to protect residents from commercial developments.
You’d have to wonder why that is.
In the meantime, if Labor does get in in NSW next year, get ready for an almighty stoush when the net tightens on the “parasites and predators” of holiday rental fiasco.
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