NSW introduces new short-stay holiday regulations

The NSW Government will introduce a new framework to govern short-stay holiday accommodation in response to the increasing popularity of websites like Airbnb.

It is intended that the new framework will include new planning laws, an industry Code of Conduct; and provisions for Strata Scheme by-laws to be implemented after extensive community, Government, industry and legislative review.

Changes to planning laws will see:

  • When a host is present in a house overnight, a home used for short-stay letting will be an exempt development and will not require the owner to apply for a Development Application. If the host is present, the home can be used for this purpose for 365 days a year.
  • Where a host is not present overnight, short-stay letting in homes will be permitted up to 180 days per year in the Greater Sydney area and 365 days in Councils outside of Greater. Councils not in Greater Sydney will have the power through their local environmental plans to limit the 365-day threshold to no less than 180 days per year.

A mandatory Code of Conduct that establishes a ‘2 strikes and you’re out’ policy will be introduced. The Code will apply to all involved in the provision or use of short-stay accommodation including hosts, guests, websites and agents.

Under the ‘2 strikes’ policy, hosts or guests that are found to have committed 2 serious breaches of the Code within 2 years will be banned from offering or using short-stay accommodation for a period of 5 years.

A ‘strike’ is ‘any behaviour which unreasonably interferes with a neighbour’s quiet and peaceful enjoyment of their home.’ Complaints will be able to be reported through a system that will be established for use by neighbours, strata committees and owner’s corporations. Once a complaint is made it will be assessed by an independent adjudicator after consideration of evidence put forth by all relevant parties.

Once established, strikes will be published online. Websites and agents that fail to check the register before accepting bookings may be fined up to $1.1million for corporations and $220,000 for individuals.

Strata scheme management laws will be amended to allow by-laws that prohibit short-stay letting in lots that are not a host’s principal place of residence. This means that hosts intending to let a room in their residence, or their entire residence while they are on holidays, will still be permitted under by-laws.

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