Explainer: Changes to NSW laws for short-term rentals and Stayz’ concerns
As you may have heard in the media, new laws for short-term rental accommodation (STRA) in NSW will come into effect from 18 December 2020. These new laws impose obligations on booking platforms (like Stayz), holiday rental owners/managers (like you), letting agents and guests. We’ve put together this document to help explain the changes and some of our concerns.
What is changing?
A mandatory Code of Conduct for the Short-term Rental Accommodation Industry will apply from 18 December 2020. This will impose certain behaviour standards on STRA guests and their visitors regarding unreasonable noise and disruption to neighbours and damage to property. Holiday rental owners have several new obligations under the Code, including:
- You must hold insurance that covers your liability for third-party injuries and death. Note that we already provide you with third-party claims protection for bookings made through Stayz, for up to US$1,000,000.
- You must enable your neighbours to contact you, or your authorised representatives, about concerns relating to your premises by giving them your contact details and being available between 8am and 5pm each day and at all times to deal with emergencies.
- You must take reasonable steps to ensure your guests meet their behaviour obligations in the Code, including by making them aware that the Code applies to their stay and making a copy of the Code readily available to them.
- You must ensure you do not rent out your premises to a guest who is recorded on the exclusion register.
Property managers have similar obligations and must inform owners and guests about the Code.
Our summary of these obligations is not comprehensive, nor is it legal advice. We advise all owners and property managers to familiarise themselves with the Code, particularly their obligations in sections 2.3 and 2.4, respectively.
The new Code of Conduct was designed to be introduced in tandem with an STRA premises register; however, NSW Planning has failed to deliver this new tool in time. Once this is developed and commences, owners must register themselves and their premises.
Importantly for holiday rental owners/managers like you, breaches of the Code may attract penalties, including warnings or directions to take or cease certain action and fines. Serious breaches of the Code may result in a ""strike"" against an owner and/or their property. Two strikes in a two-year period will result in a listing on the exclusion register, which means the person or property is prohibited from participating in the short-term rental accommodation industry for up to five years.
What are Stayz’ concerns?
While we generally support the new regulatory framework for STRA in New South Wales, there appear to be several flaws in the planned roll out and implementation that we believe need to be addressed. "Without changes to planning laws, most NSW holiday rental properties will be in contravention of the Code. While the Code of Conduct is scheduled to commence from 18 December 2020, there has been no announcement on when necessary changes to planning laws will commence. The problem is that unless and until changes are made applying a consistent regulation of the use of premises for STRA across the whole state, STRA at many dwellings in NSW may well contravene existing planning laws and therefore the new Code.
Hosted accommodation will largely be exempt from these new regulations and will be allowed to continue to operate with little oversight. This will tilt the playing field in favour of hosted stays and mean amenity complaints in these properties will remain unresolved.
The new planning rules that will restrict the availability of unhosted accommodation to 180-days per year. Night caps not only put the economic uplift associated with the tourism sector at risk, but also fail to address the four most consistently raised questions about our industry, namely: housing affordability, housing availability, the impact on government resources and service provision, and finally, impact on neighbourhood amenity.
The failure to build a register of all STRA premises to coincide with the introduction of the Code of Conduct. The lack of a premises register means the Government remains in the dark about the industry and will be unable to pursue complaints about anti-social behaviour by travellers and irresponsible owners.
While clear and effective regulation is welcome, misguided and poorly timed regulation will have a negative impact on the holiday rental industry and put the recovery of NSW’s tourism sector at risk.
How we’re addressing these concerns
We have written to the Minister for Better Regulation and Innovation, the Hon Kevin Anderson MP, to raise our concerns and present simple solutions to ensure good outcomes for the holiday rental owners/managers who list on Stayz and the STRA sector more broadly.
We have also contacted the Minister for Planning and Public Spaces, the Hon Rob Stokes MP, and his department to voice our disappointment and call for the building of the STRA premises register to be expedited in consultation with industry and the community.
Finally, to ensure that the NSW Government understands the impacts of introducing a half-finished regulatory framework, we are calling on our partners to consider writing to their local NSW MPs. To assist in this, we have developed a form letter, included with these materials.
A lot of information is still not available to us, but we're continuing to meet with officials from the Department of Customer Service and the Department of Planning, Industry and Environment to understand and work through the details.
As we gather further information, we’ll be sharing that with you. We’ll also keep pushing to make sure these new changes are fair and reasonable as well as to bring better certainty to you and your guests.