In NSW there will soon be one law for houses and another law for home units when it comes to short-tern rental arrangements, as a result of a new policy announcement by the NSW Government.
Short-term rentals, booked on Airbnb, Stayz and with holiday rental agents are popular for holidays, business travel, emergency accommodation and special events. They can be overnight stays or stays of up to 90 days (if more than 90 days they are residential tenancies).
The new policy is an 'open door' policy for short-term rental of houses.
They have their own approved planning use and can rent without local council permission all year round so long as the 'host' - the owner, tenant or permanent resident - is living in the house. This is the traditional rent 'a spare room' use.
But if the host is an absentee landlord, restrictions will apply: the number of days is limited to 180 days in a calendar year in many parts of NSW: Greater Sydney Region, Ballina, Lake Macquarie, Clarence Valley, Muswellbrook and 90 days in Byron. The day limit applies to days occupied by guests. If the guests stay for more than 21 days, they are not counted towards the 180 days. There is no day limit elsewhere in NSW.
The restrictions are much tougher for home units / apartments / town houses in a strata scheme.
If the host is living in the strata property, they can rent the spare room without local council or strata owners corporation permission all year round.
But if the host is an absentee landlord, there are four scenarios:
- If the strata property is the principal place of residence, then it can be rented for up to 180 days a year (stays over 21 days not counted).
- If the strata property is not the principal place of residence, then the 180 day stay restrictions apply according to where the property is, as outlined above, subject to 3.
- If the strata property is not the principal place of residence, the strata owners corporation may ban short-term rentals outright, by passing a by-law by special resolution with a 75% majority at a general meeting.
- They can obtain planning permission to use the property as a serviced apartment. This permission is only possible if the property has a mixed use or business zoning. If obtained, it the council consent may override a by-law banning short-term rentals.
In summary, it will still be easy to have short-term rentals in houses, but much harder in home units.
For a detailed explanation, click on my article