Understanding the changes to short-term rental accommodation in NSW

As of 10 April 2020, changes to the Fair Trading Act 1987 and the Strata Schemes Management Act 2015 mean that strata properties in New South Wales can now prohibit short-term letting where it is not an owner’s principal place of residence, through drafting of a new by-law.

This means someone who is living in a strata property as their principal place of residence will still be able to rent their home or a room while they are living there or temporarily go on holidays.

This new regulatory framework has been designed to find balance in allowing communities to continue to gain from the economic benefits of the short-term rental accommodation industry (STRA), this has seen a rapid expansion in recent years through platforms such as Stayz and Airbnb, while minimising any negative impacts on neighbours caused by problematic behaviour.

The changes will also see the introduction of a mandatory code of conduct and a complaints/enforcement system, which applies to anyone involved in providing or using short-term letting. This framework is due to come into effect in November 2021. It is anticipated that if hosts or guests commit two breaches of the code of conduct within two years, they will be banned for five years. This will help regulate any anti-social behaviour which interferes with the peaceful enjoyment of a neighbour’s home.