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NSW Department of Planning, Industry and Environment
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The NSW Government is implementing a new regulatory framework for short-term rental accommodation (STRA). This includes a statewide planning framework, a mandatory Code of Conduct and changes to strata legislation. The NSW Government is also developing 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.

 

A balanced approach for homeowners and visitors

The Department of Customer Service and the Department of Planning, Industry and Environment worked together to develop a framework for STRA, which includes a mandatory Code of Conduct, a property register and amended regulations.

 

The updated policy framework will allow homeowners to access the benefits of the sharing economy while providing certainty and safety for communities and visitors.

 

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

 

The new framework will include:

  • A new standard definition of STRA
  • A 180 day cap for non-hosted STRA homes in Greater Sydney, with the ability for other councils to opt in
  • The ability for hosted STRA homeowners to rent their homes out 365 days of the year
  • Minimum fire safety standards
  • A Code of Conduct that applies to hosts, guests, online booking platforms and letting agents.

 

The STRA Code of Conduct and exclusion register applies from 18 December 2020.

 

It is anticipated that the whole-of-government framework will be finalised in the first half of 2021.

 

What's 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 statewide planning framework, changes to strata legislation and a mandatory Code of Conduct.

 

During August and September 2019, the department consulted on a proposed regulatory framework for STRA, including draft instruments and regulations, a draft Code of Conduct, proposed strata legislation amendments, and the scope of a property registration system. Over 2000 submissions were received by the department during this exhibition period.

 

There was general support for a statewide regulatory framework, however views differed as to the extent of regulation, detailed controls and how regulation should work.

 

Shortly after this, the STRA sector has suffered a significant blow as a result of the 2019/2020 summer bushfires and subsequent COVID-19 pandemic.

 

In response to feedback received during stakeholder consultation and the Covid-19 pandemic, the new policy framework achieves a balanced outcome to ensure businesses and homeowners get back on their feet as restrictions continue to ease by providing clarity, consistency and certainty ahead of summer.

 

The new rules applying to a statewide planning framework are yet come into force, but are anticipated to be finalised in the first half of 2021.

 

On 27 October 2020 the Fair Trading Regulation 2019 was amended to declare the new mandatory Code of Conduct for the Short-term Rental Accommodation Industry. The new Code of Conduct is in force from 18 December 2020 and imposes obligations on booking platforms, hosts, letting agents and guests

 

Changes to strata legislation commenced on 10 April 2020.

 

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

 

Code of Conduct for the Short-term Rental Accommodation Industry and supporting regulation

On 18 December 2020, the new mandatory Code of Conduct and the accompanying Fair Trading Amendment (Short-term Rental Accommodation) (No 2) Regulation 2020 commenced.

 

The Code creates new minimum standards of behaviour and requirements for all industry participants, including:

  • Booking platforms
  • Hosts
  • Guests
  • Letting agents
  • Facilitators.

For information about the new code, visit the NSW Fair Trading website.

 

Previous Fair Trading amendments

On 27 October 2020, the Minister for Better Regulation and Innovation announced amendments to the Fair Trading Regulation 2019 declaring the new mandatory Code of Conduct for the Short-term Rental Accommodation Industry. The new Code of Conduct applies from 18 December 2020 and imposes obligations on booking platforms, hosts, letting agents and guests.

 

On 10 April 2020, amendments commence to the Fair-Trading Act 1987, Strata Schemes Management Act 2015 and the Residential Tenancies Act 2010.

 

These changes allow owners corporations to be able to pass by-laws that prohibit short-term rental accommodation within strata schemes, but only in lots that are not a host’s principle place of residence.

 

Short-term rental accommodation arrangements of three (3) months or less will not be regulated under the residential tenancies laws.

 

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. 

 

Short-term rental accommodation in Byron Shire

On 11 February 2019, the former Minister for Planning announced a new Ministerial Direction that invites Byron Shire Council to prepare a Planning Proposal that could introduce a 90-day threshold in the most impacted towns of the Local Government Area.

 

The Direction is in response to the high concentration and unique impacts of STRA on some parts of the Byron Shire. The Planning Proposal process will include impact assessment and consultation with communities.

 

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

 

More information

For more information you can:

 

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Page last updated: 18/12/2020