Update on Airbnb legislation

Contributed by Col Myers, Partner, SMALL MYERS & HUGHES – 4 April 2019

Update on Airbnb legislation

Like strata legislation, real estate licensing and just about everything else that impacts on our daily lives, the various State Governments in Australia simply cannot agree on a uniform approach about how to deal with the Airbnb phenomenon.

Looking down the east coast of Australia, only Victoria has legislation that is up and running. New South Wales has formulated its proposed legislation and the expectation is that it will be passed (and commence) sometime this year. Meanwhile, Queensland is still in the early review stages and from what I can gather, legislation is not on the horizon during the 2019 year.

Looking at each of the eastern States:

VICTORIA

The Owners Corporation Amendment (Short-Stay Accommodation) Act 2018 commenced on 1 February 2019.

The Act only applies to stays of a maximum seven days and six nights.

Under this legislation, an owner or occupier of a lot, or a Strata Manager, may make a complaint to the Owners Corporation about an alleged breach by a short-stay occupant. The following behaviour can constitute a breach:

· Unreasonably loud noise that disturbs the peaceful enjoyment of residents;

· Causing a substantial hazard to the health, safety and security of any person;

· Unreasonably and substantially obstructing the use of common property;

· Intentionally or negligently damaging or altering a lot or common property.

Any claim of a breach has to be made in writing within 60 days of the alleged behaviour. Even if the short-stay provider has already rectified the breach, the Owners Corporation can still apply for a short-stay dispute resolution with VCAT.

VCAT can make an order in relation to a dispute:

· Prohibiting short-term letting arrangements in the property if the short-stay provider has been served with three separate breach notices within a two year window;

· Order a short-stay provider to compensate up to $2,000.00 per affected occupier (resident or guest of a resident) for behaviour done by the short-stay guest;

· Order a short-stay occupier to pay up to $1,100.00 as a single penalty for bad behaviour as listed above.

NEW SOUTH WALES

New South Wales is proposing to adopt a three-way solution:

1) Amending the Fair Trading Act 1987

These amendments will include reference to a mandatory Code of Conduct. This Code will establish a “two strikes and you’re out” policy where hosts or guests who commit two serious breaches of the Code within two years will be banned for five years.

Platforms and letting agents will not be permitted to offer services to anyone or any dwelling that is listed on the exclusion register. Platforms and property agents will have to check the register before taking on new customers and if they fail to do so, significant penalties of up to $1.1 million for a corporation and $220,000.00 for individuals can apply;

2) Amendments to the Strata Schemes Management Act 2015

These amendments will allow a by-law to be made by an Owners Corporation special resolution (effectively 75%) that will prohibit a lot being used for the purpose of short-term rental accommodation if the lot is not the principal place of residence of the person who, pursuant to the arrangement, is giving another person the right to occupy the lot.

A by-law however has no force or effect to the extent that it purports to prevent a lot being used for the purpose of short-term rental accommodation if the lot is the principal place of residence of the person who, pursuant to the arrangement, is giving another person the right to occupy the lot;

3) Change to planning laws

If the host is present, they can use their unit for short-term letting all year round as exempt development: ie no need to submit a Development Application to Council. If the host is not present, the residence can only be used for short-term holiday letting for periods:

· up to 180 days per year in the Greater Sydney area, and

· 365 days a year in all other areas of New South Wales, unless a Council decides to reduce the minimum period (but it cannot be reduced to less than 180 days per year).

QUEENSLAND

The Queensland Government has set up an industry reference group and formal recommendations from the Queensland Government are currently overdue.