Those of you who follow the local news may have heard that the NSW State Government’s Independent Planning Commission (IPC) recently released its recommendations on the issue of Short-Term Rental Accommodation (STRA) in the Byron Shire. At the top of the list of recommendations is that Byron Shire Council be able to limit un-hosted STRA across the Shire to 60 days per year without development consent. However the report also included a range of other recommendations, relating specifically to the regulation of STRA as well as the housing crisis more broadly, including:
- Preventing the conversion of new housing stock to non-hosted STRA through conditions of development consent for new housing developments.
- Ensuring that secondary dwellings being used for STRA are returned to the long-term rental market, including exploring regulations and incentives.
- Increase the supply of non-STRA visitor accommodation in the town centre.
- Formalise arrangements for the use of STRA as emergency housing during disasters.
- Introduce a levy on all STRA properties (several options were recommended, including owner-pays and user-pays models).
- Improve data collection on STRA to inform decision making, including requiring STRA platforms to make public a greater set of data at no cost to government.
One of the most important recommendations, though not within the jurisdiction of local government, was that the NSW Government act to address the key drivers of the housing crisis, which is the economic policy and regulatory settings that promote housing as an asset class instead of a human right and the underinvestment in social housing.
The IPC’s report has been widely celebrated by elected representatives, including the Mayor of Byron Shire and the State Member for Ballina, Tamara Smith MP. The recommendations were more ambitious and wide-reaching that most were expecting (after years of jumping through hoops, they were within their rights to be cynical). In the end, the IPC was able to do what elected representatives never could, which was to provide sensible and evidence-based policy advice that cut through fractured political debate.
That said, the recommended reforms have taken far longer than they ever should have. In the meantime, thousands continue to suffer as a result of the housing crisis. Many, including myself believe that the scope of reform recommended by the IPC should have been tackled by the former Coalition government many years ago. The only fair thing left for the new Labor Housing Minister to do is the fully endorse the recommendations and get to work on supporting Byron Council to implement them.
Since the release of the IPC report, a few people asked me what this means for the Ballina Shire. Here are my thoughts:
Should Ballina Council pursue a 60-day cap on un-hosted STRA?
The short answer, in my opinion, is not yet.
While I have been outspoken about the proliferation of STRA, particularly in my hometown of Lennox Head, I do not believe that a 60 cap on un-hosted properties would be effective at returning affordable properties to the long-term market.
At the time of writing, there were 813 properties in the Ballina Shire available on AirBnB. Of these, 92.7% (754) were entire houses/units, but only 185 of these were booked within the last 6 months and for more than 60 days per year in the last 12 months. Of these 185 properties, 89.7% (166) are entire houses/units. Of these 166 entire houses/units, about 20 are exempt from any potential cap, as they are not situated within residential homes (e.g. they are hotel rooms or unit complex advertised on AirBnB). This suggests that at the time of writing, no more than 150 whole homes would likely be subject to a 60-day cap. If a cap was introduced, only proportion of these (that is difficult to estimate) would be returned to the long-term market, while others may remain empty.
Of course, while AirBnB is the most popular online platform for STRA, it does not account for all the properties available for STRA. It is also difficult to note what flow-on impacts will occur as a result of any reforms implemented across the border in the Byron Shire. For example, if STRA investors look to establish their investments in unregulated LGAs, the situation may change fairly rapidly, warranting reconsideration of a cap on STRA.
One important thing to note is that about half of these 166 properties likely to be subject to a cap are in the Lennox Head area, where they still outnumber properties available for long-term rental by a ratio of about 1:5. If even half of these properties were returned to the long-term market it would make a significant difference to the availability of rental accommodation. This demonstrates the importance of postcode-level analysis when considering policy responses to STRA.
What other actions can we take to address the housing crisis?
While I don’t think a 60-day cap on un-hosted STRA is the right policy lever for the Ballina Shire right now, there are a number of other things we can be doing to address the housing affordability and availability crisis, including by not limited to regulating STRA, including:
- Approving more non-STRA visitor accommodation, including tasteful medium-density holiday complexes in appropriate areas. While considerations around parking and amenity are important, these properties will ultimately compete with residential properties within the same STRA market, leaving the latter available for long-term renters.
- Where necessary, including hosted STRA in scope for regulation. This is important as hosted STRA is more likely to occupy secondary dwellings (e.g. granny flats), which are also more likely to be affordable. Don’t panic, I am not recommending widespread regulation of hosted STRA, however in areas where it is undesirable (e.g. newer residential sub-divisions) we may need to consider using incentives (such as reductions in developer contributions) or regulations (e.g. imposing conditions of development consent) to ensure that secondary dwellings are not used for STRA, or even better, offered to long-term renters.
- Developing Council-owned land for affordable workforce housing, including the 30 lots we have ready to build in the Wollongbar Urban Expansion Area and up to 60 lots in Lennox Head. This could be partially funded by some kind of levy on STRA similar to that recommended by the IPC.
- Exploring other, more innovative ideas, such as requiring each residential lot to contain a minimum of two dwellings. Through clever design these could be combined into a single, larger dwelling and then “split” into two at a future point in time. This would enable people to downsize while “ageing in place”.
The main difference in the IPC recommendations as they relate to Ballina and Byron Shires is the issue of increasing housing supply. Unlike the Byron Shire, the Ballina Shire has re-zoned enough residential land to meet projected population growth for the next 20-30 years. Any further greenfield growth in the Ballina Shire is subject to constraints, including geographical (e.g. slope, proximity to services), environmental (e.g. presence of endangered ecological communities), bushfire and flood risk. In short, despite what developers will tell you, there is not a great deal of land left in the Ballina Shire to develop. This leaves Council increasingly reliant on medium-density infill to cater for future population growth, which is arguably more sustainable and climate smart anyway.
Do you like this page?