Is your short-term letting accommodation legal?

Short-term letting has become a popular side hustle or even a full-time income for many people. After it started over 10 years ago in 2008, Airbnb has become the largest short-term letting platform with over 150 million users. Now, there are dedicated short-term letting management companies as well as other short-term letting platforms such as Stayz.

What is short-term letting?

Short-term letting essentially involves renting out your property for a short period. The exact definition varies, however, it’s usually described as a period under six months. With the popularity of Airbnb and Stayz, short-term lets are usually between one night and a few weeks. Short-term lets are typically popular among tourists looking for an alternative to traditional motels and hotels.

Depending on the location of an Airbnb, Airbnb hosts can generate a significant amount of money. This is especially the case when demand is high and supply is low. In many cases, Airbnb hosts make more money from short-term letting than they would if they were to find long-term tenants. However, short-term letting comes with more instability and risk.

Restrictions

Of course, as with anything else, there will be restrictions involved with short-term letting depending on the location of the property. Unfortunately, Australia doesn’t have consistent rules for short-term letting and neither do most states. In general, your best bet is to research the regulations for the local council. New South Wales has a clear set of rules for how to go about short-term letting whereas other states haven’t.

New South Wales

New South Wales Fair Trading has laid out a framework for the entire state. If you’re short-term holiday letting in your own home, you’re allowed to do so all year. However, if you’re residing somewhere else, you’re allowed to short-term holiday let for only up to 180 days in Greater Sydney and between 180 to 365 days in other areas of New South Wales depending on your local council. Owners corporations can also pass by-laws prohibiting an investment property being used for the purposes of short term holiday letting.

Queensland

In Queensland you may need to obtain approval from your local council for short-term letting. For example, the Brisbane City Council and Gold Coast City Council require you to apply for a development approval if you’re not residing in the property and using your entire dwelling for short-term letting. It can be a significant cost to obtain a development approval for this. If you’re living in the property, short term letting may be considered a home based business and may not require a development approval. It’s important to look into the rules for your specific local council and engage a town planner for some advice if you’re unsure. A body corporate is generally not permitted to restrict short-term letting in its by-laws but may refuse to provide consent to a development application. Also, a body corporate has recently has its ban on short term letting upheld due the characteristics of the community.

Victoria

Short-term letting regulations in Victoria are different depending on your local council. For example, in the Mornington Peninsula Shire region, the third highest destination for short-term stays in Australia, property owners are required to register with the council. Property owners are also required to appoint a designated contact person, ensure occupants adhere to the Code of Conduct and to provide enough parking and bins for occupants. There are also new short-stay accommodation regulations across the state that address unruly parties.

Guest author: Ellen Orton is the Head of Business Operations at OpenAgent.com.au, an online agent comparison website helping Australians to sell, buy and own property.

Richie Muir

Legal Director

Richie is an experienced and commercially astute lawyer specialising in property law. He leads lawlab’s team of legal advisors and is the go-to problem solver for complex or unusual matters.  Having spent many years living and studying in Europe he now calls Brisbane home. Outside of work he juggles his time helping bring up his 2 young daughters, playing football and developing property.