Another Round on Holiday Letting

February 27th, 2020

View latest update: Sep 2nd, 2022
The never-ending saga of what to do about short-term holiday letting is at the end of another cycle. This topic has been around the block almost as many times as the Byron bypass. Council is recommending a blanket 90-day limit across the Shire. Unfortunately, this may solve some minor issues with holiday letting but will probably create some larger ones.

Past concerns about the rise of Airbnb, Homestay and other sharing platforms have been justified. It is argued that short-term holiday letting reduces the pool of owner-occupied homes and permanent rentals. It is also upsetting if you live in a popular location and your neighbour is an absentee landlord who allows poorly-managed short-term rentals to drunk and noisy holidaymakers. But does this warrant Council’s drastic reaction?

Some New Problems

Many early problems with holiday letting, such as noise and bad behaviour, have largely been resolved by industry self-regulation and the management of the industry HLO (Holiday Letting Organisation). Sensible and considerate property owners knew these would be ongoing issues unless they were better controlled. Ironically, the 90-day limit will take HL management out of the hands of experienced, competent owners and put it back under the supervision of amateurs. We could see the return of noise and mess.

The claim that the Short Term Holiday Letting is taking homes out of the rental pool could be overstated. Byron and Brunswick Heads Public Schools look to be building new classrooms. The two Steiner schools in the area have long waiting lists. And wasn’t there an Expression Of Interest for the South Byron Treatment Land to be used for a whole new school? Holidaymakers don’t put their kids in school. Even if all these houses were put back in circulation they may not even go back to permanent letting or to owner-occupiers. Many of these homeowners will leave them vacant when not using them themselves. Is it realistic that the owner of a multi-million-dollar beachfront home or apartment is now going to put it out for tenancy to the affordable rental market?

As a buyer’s agent, it has been years since a client asked me to find them a Holiday Let property to run as a business. The economics do not stack up anymore. Byron’s median house price is the highest in the country so anyone looking for an investment yield is just not interested. Yes, there has been an increase in HL properties since 2016. But I believe that most of these properties are for future residents, buying now and waiting for the time when they can move or retire. I do get these people as clients. They put their houses on Airbnb while not using them themselves and still intend to move in the future.

Obviously, this policy will put a big hole in tourist numbers. This will have a run-on effect on local businesses and jobs. Byron attracts around 2.2 million visitors each year. 1.2 million are day-trippers and 1 million stay overnight. Mostly, overnight visitors are families who stay a week or so, spend lots of money and are in bed by nine. They like to stay in a house. They don’t want a host, a B&B or a motel room. The irony is this policy will kill the type of tourists we want and leave us with day-trippers or illegal campers who contribute little to the community.

Airbnb Here to Stay

Businesses like Airbnb and Uber are popular. They are here to stay. These are disruptive businesses not because they want to disrupt but because they utilise new technologies which users embrace on both sides of the app. The only part of their business models I do not agree with is how this money is hoovered up and sent offshore. This new policy may give the opportunity for Council to collect a fee or DA licence. But I hear the amount is obviously intended to kill the industry and not work with it.

If we still want a tourism industry but want to destroy Airbnb and STHL, then many of these funky old wooden beach houses which are being renovated and maintained in their original condition will be torn down and rebuilt into units – probably ugly, multiple-story eyesores. It could completely wreck the look and feel of Byron and do exactly the opposite of what the protagonists of this policy want to do – keep Byron as a quaint, charming coastal holiday town.

History of Good Practice

In Brunswick Heads, there are holiday homes that have been rented out continuously since before the First World War. There has never been an issue or problem with Holiday Letting because the good burghers of Brunswick got on to it early and branded their town for ‘Simple Pleasures’ to attract families and deter party animals. I don’t have the stats but I am sure the number of drunken and violent incidents has decreased in Byron. The town has also successfully evolved from the bad old backpacker and low rent days to a more family-friendly destination.

Basically, this regulation is an ill-advised answer to a problem that was an issue at least a decade ago. That is not to say some things don’t need fixing and improving. But killing Airbnb is like the Dutch boy with the finger in the dyke. It may be a temporary fix but these home-sharing sites are here to stay and we need to find ways to make them palatable for everybody. The road of good intentions is full of man-made disasters – this could be one of them.

I encourage any readers who dispute these assertions to make a comment below and discuss it. I would love to be proved wrong and happy to change my opinion if a good case can be put to me.

Full Disclosure: My family and I live very close to the Blues Festival site. We often rent the house for Easter on Airbnb and go away, as we are planning to do this year. We will actually benefit from the 90-day rule but think the whole community will suffer. I do not own any property that is used exclusively for holiday letting.

Related Articles

Update – Short Term Holiday Letting
Is AirBNB really the problem?
The Byron Shire’s Housing Affordability Crisis
Residential Settlement Strategy
Secondary Dwellings on MO’s and CTs

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