Question time: short-term holiday letting

28th July 2020

Mr GREG PIPER (Lake Macquarie) (14:38:55): Somewhat ironically, my question is directed to the Minister for Better Regulation and Innovation, who is seated near me in the gallery. Given that it is almost two years since draft regulations were developed for the short?term holiday letting industry code of conduct, when will the Government implement the code of conduct to protect residential neighbourhoods from undue impact?

Mr KEVIN ANDERSON (TamworthMinister for Better Regulation and Innovation) (14:39:42):I thank the good member for Lake Macquarie for his question and acknowledge his interest in the regulation of the short-term accommodation rental industry, which contributes more than $30 billion to the national economy. The industry in New South Wales contributes more than half that amount. While the sector in New South Wales undoubtedly provides significant economic benefits for local communities, at times it can also have adverse impacts on neighbours and communities. All members have heard their fair share of horror stories of antisocial guest behaviour, increased noise for neighbours at ungodly hours as mentioned by Opposition members and strain on local infrastructure.

On 5 June 2018 the New South Wales Government announced a new regulatory framework for short?term rental accommodation in New South Wales with three main parts: allowing strata schemes to adopt by-laws that prohibit short-term letting where a lot is not the principal place of residence of a host; applying a mandatory code of conduct to booking platforms, letting agents, hosts and guests; and providing a statewide planning framework to achieve consistency in planning controls across the State. On 14 August 2018 the New South Wales Parliament passed the Fair Trading Amendment (Short-term Rental Accommodation) Bill 2018. As well as creating a head of power for strata schemes to prohibit short-term holiday letting it also allows for the introduction of a code of conduct.

The other elements of the reform relating to changes to the statewide planning framework are being led by the Minister for Planning and Public Spaces. Public consultation on all the details of the regulatory framework, including the code, planning instruments and proposed register, occurred from 14 August to 11 September 2019. Over 2,100 submissions were received, with a wide range of stakeholders and community members providing valuable feedback. That feedback has been especially instrumental in helping us to refine the code of conduct. The code has been the subject of extensive consultation. I am pleased to say it is now in a final form. It clearly sets out the rights and obligations of all industry participants including booking platforms, letting agents, hosts, guests and other facilitators.

Fair Trading will be able to take disciplinary action including the issuing of a warning or direction to an industry participant, or recording a strike against a host or a guest. Fines also can be issued for identified breaches of the code. If Fair Trading records two strikes for breaches of the code within two years against a host or guest, the host or guest will be placed on an exclusion register that prohibits them from participating in the industry for five years, subject to review and appeal rights. Industry participants will be required to ensure they are not making or facilitating a short-term rental accommodation arrangement with a guest, a host or a host's premises that is on the exclusion register. For serious breaches, the code provides for maximum potential civil penalties of up to $1.1 million for corporations and $220,000 for individuals.

New South Wales has faced an escalating situation with COVID-19. The developing situation comes on top of the impacts of bushfires and will continue to have a significant impact on the accommodation sector. As a result of those impacts and the impacts to Government resources, a decision has been made to postpone the introduction of the commencement of the code of conduct and the statewide planning regulatory framework. The Government is using this time to work carefully through the detail to ensure we get the balance right and that the industry is ready and able to implement the reforms.

I appreciate the advocacy of the member for Lake Macquarie on this issue. I am pleased to advise him that the strata scheme reforms commenced on 10 April 2020. This important reform allows strata schemes to prohibit short?term rental where the lot is not the principal place of residence of the host. This will help strata schemes to better manage short-term rental in their buildings. We know the short-term rental industry and the broader accommodation industry have been hit particularly hard by the COVID-19 pandemic. Short-term rental agents and owners report that demand dried up almost immediately overnight. It will take the industry some time to recover. We understand that people are doing it tough. That is why the Premier and the Treasurer have outlined a clear and comprehensive COVID-19 Recovery Plan to ensure that New South Wales will emerge on the other side of this pandemic even more resilient and self-sufficient.

Website: Read the Parliamentary Hansard here

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