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Opinion_

Australian governments are treading lightly around Airbnb

24 April 2017
Experts react to NSW government inquiry into online home sharing

Australia is gripped by a housing affordability crisis. Without proper planning, legalising Airbnb may make housing even more unaffordable in high-demand suburbs, writes Professors Nicole Gurran and Peter Phibbs.

Airbnb sign.

Australia, and particularly Sydney, is gripped by a housing affordability crisis. So the NSW government鈥檚 omission of any concrete commitment to monitor the conversion of permanent rental housing to holiday accommodation, like Airbnb and Stayz, is concerning.

It would seem regulators in NSW and many other states in Australia are out of sync with their international counterparts, who have made a clear distinction between home sharing and the loss of rental supply in their property markets.

Rising complaints about tourists in residential apartments and homes prompted . Since the inquiry concluded in mid 2016, Sydney鈥檚 Airbnb listings alone have to reach a total of .

Over approximately the same time, in Sydney. These figures are not connected but highlight the changing ways that homes are being designed, financed and used in high density urban and suburban settings.

Online holiday rentals in particular have not been planned for, and the legality of a range of 鈥渉ome-sharing鈥 practices now enabled by online platforms such as Airbnb remains unclear.

But rather than launch a , the NSW government has opted to tread lightly for now. The NSW government鈥檚 long awaited response to the inquiry has promised 鈥渂road consultation鈥 involving industry and the community.

This consultation is supported by an 鈥渙ptions paper鈥 to identify 鈥渁ppropriate regulations鈥. It appears the 鈥渙ptions鈥 will involve amendments to planning laws to clarify that residences can be rented for up to a specified number of days without the need for further planning approval.

Short-term letting of rooms where hosts remain present will probably also be permitted. Short-term letting of empty houses (ie. homes which would otherwise be vacant) may be subject to 鈥渋mpact thresholds鈥 - likely around number of guests.

The NSW Government鈥檚 default position appears to rely on existing local government powers to act in relation to noise or other complaints, while potentially empowering apartment owner corporations to set and enforce their own rules.

How the NSW government鈥檚 response compares

The conversion of permanent rental housing supply to short-term accommodation has been endemic in New York, , , , and . In these cities governments have cracked down heavily on Airbnb and other online platforms to prevent affordable and rent controlled units in particular from being used for holiday accommodation.

The cautious approach by the NSW government may reflect the fact that internationally, attempts to regulate online holiday rentals have had limited success. Despite New York鈥檚 ban on short term holiday rentals, which now extends to the advertisement of these properties, Airbnb listings in that city .

However, in some cities, and usually following legal action, Airbnb has agreed to help implement local rules. For example, by , or by blocking bookings .

Such an arrangement has been introduced in London, where which automatically restricts bookings beyond a 90 day calendar year threshold, unless the host has obtained planning permission to operate a holiday rental property.

It鈥檚 too early to know whether this action will curb London鈥檚 growing conversion of permanent rental accommodation to tourist accommodation or simply result in landlords turning to other online platforms. But this intervention represents an important first step, and NSW might do well to follow suit.

The NSW inquiry and government response certainly anticipate greater use of voluntary and industry codes of practice, as well as market based forms of regulation (for instance, where users rate each other). in the US, where owners鈥 corporations are able to take a percentage of income from Airbnb bookings and set specific policies (such as blackout dates).

Market based regulations and voluntary codes may be feasible in a sector which is highly conscious of branding and public image. However, these individualised and market-based approaches may undermine strategic planning strategies designed to cluster tourist accommodation near facilities, services, and attractions.

Airbnb and housing affordability

Nor do such approaches address the potential impacts of short-term rentals on the availability and cost of permanent rental housing. The NSW Government hasn鈥檛 said much about housing affordability.

shows that general pressure on already tight rental vacancy rates in high-demand suburbs of inner Sydney will be exacerbated if online holiday listings of whole homes continue to grow.

Our study found that in central Sydney, frequently available Airbnb homes amount to around one and a half times the rental vacancy rate. This rate is the proportion of rentals available for local households to rent at any one time. It was also nearly four times the number of rental vacancies in the inner suburb of Waverley.

Balancing neighbourhood and housing market concerns

Echoing concerns from and , Sydney鈥檚 tourists generate increased noise, rubbish, traffic and parking congestion and are prone to loud and drunken behaviour.

There is also wider disquiet about the increasing presence of visitors, an intangible transformation of local neighbourhoods. This impalpable change 鈥 as tourist driven gentrification. This arises when permanent homes are converted and residents displaced by holiday accommodation.

So it is critical that the growth of short term rentals is monitored 鈥 especially in already overheated housing markets. Ideally, online platforms will come to the party by releasing clear and transparent listings data and co-operating with regulatory efforts.听

Online accommodation platforms within the wider so called 鈥渃ollaborative economy鈥 open new opportunities for cities but also present new risks.

In 鈥渢reading lightly鈥 around Airbnb and other new short term accommodation providers, let鈥檚 hope the NSW Government is able to broker real solutions which allow hosts and visitors to enjoy 鈥渉ome-sharing鈥 without undermining local neighbourhoods and housing supply.

was first published on 听and written by听 and , housing researchers in the University of Sydney's .

Mandy Campbell

Media & PR Adviser

Professor Gurran talks about online home sharing

Talk presented by Professor Nicole Gurran at the University of Sydney in April 2017 about her research into online home sharing in Australia.

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