Short-term rental accommodation -

The NSW Government is implementing a new regulatory framework for short-term rental accommodation (STRA). This includes a state-wide planning framework, a mandatory Code of Conduct and changes to strata legislation. The NSW Government is also considering the introduction of a new industry-led STRA property register.

The framework intends to ensure local communities enjoy the economic benefits of STRA, while managing potential adverse impacts.

Current status

The Department of Customer Service and the Department of Planning, Industry and Environment welcomed feedback on the draft framework, including the mandatory Code of Conduct.

The exhibition is now closed. Thank you to all who provided feedback, submissions are now under consideration.

The draft Code, draft amendment regulations and STRA property register were also on exhibition.

All key documents exhibited can be accessed via the planning portal.

The proposed changes include:

The draft planning instrument which will introduce:
- A new definition of STRA.
- New ‘exempt’ and ‘complying’ approval pathways that enable STRA within day limits:
  - Where the host is present, STRA is ‘exempt development’ for 365 days per calendar year.
  - Where the host is not present, and the site is not on bushfire prone land or a flood control lot, STRA is ‘exempt development’ for:
    - 180 days in Greater Sydney
    - 365 days in regional areas; except where a council varies this to no lower than 180 days.
  - Where the host is not present, and the site is on bushfire prone land or a flood control lot, STRA is ‘complying development’ within the above day thresholds.
  - Where the host is not present, and the booking is for 21 or more consecutive days, the booking will not count towards the above day thresholds.

The Fire Safety Standard which will apply to dwellings used for STRA, and an amendment to the Environmental Planning and Assessment Regulation 2000 to introduce this.
The draft Code of Conduct for the Short-term Rental Accommodation Industry (the Code) that will apply to hosts, guests, online booking platforms and letting agents.
The draft Fair Trading Amendment (Code of Conduct for Short-term Rental Accommodation Industry) Regulation 2019 that will support the Code’s implementation.

Feedback was also sought on the potential scope of a new industry-led STRA property register.

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What has happened so far?

Policy development

The Government has investigated policy options in response to the growth of STRA in NSW.

This included a Parliamentary Inquiry into the Adequacy of the Regulation of Short-term Holiday Letting in New South Wales in 2015-16 and inviting feedback on an Options Paper between 21 July and 21 October in 2017. Submissions made in response to the Options Paper can be viewed at Department's Plans and Policies website.

On 5 June 2018, the NSW Government announced a new regulatory framework for STRA in NSW, including a state-wide planning framework, changes to strata legislation and a mandatory Code of Conduct.

None of the new rules have come into force yet.

Fair Trading Amendment (Short-term Rental Accommodation) Act 2018

On 14 August 2018, the NSW Parliament passed the Fair Trading Amendment (Short-term Rental Accommodation) Act 2018 (the Act). The Act allows for:

the introduction of a Code of Conduct
changes to the Strata Schemes Management Act 2015 so strata schemes may adopt by-laws prohibiting STRA where the lot is not the host’s principal place of residence.

Following this, the Department of Customer Service developed a draft Code with input from key government agencies and an advisory committee consisting of:

online booking platforms
professional and industry associations
property owners' associations
strata sector organisations
Local Government NSW
Tenants' Union of NSW.

Proposed amendments to planning rules exhibited in 2018

On 5 October 2018, the Department of Planning, Industry and Environment exhibited an Explanation of Intended Effect which outlined proposed amendments to planning rules to introduce the STRA planning framework.

The proposed amendments to planning rules included:

A single definition of STRA
Exempt and complying development pathways that enable STRA within day thresholds, depending on host presence and bushfire risk
Minimum fire safety and evacuation requirements for premises used for STRA.

The Department has published submissions received at Department's Plans and Policies website.