Holiday homes could be hit with a new tax to generate more long-term rental accommodation

Holiday homes could be hit with a new tax to generate more long-term rental accommodation

Short-stay rental properties in New South Wales could be hit with a new tax under a raft of measures being floated to ease the state’s housing crisis.

The NSW government released a discussion paper today to examine how short-stay rentals and holiday homes could be converted to long-term rental accommodation.

Housing and Homelessness Minister Rose Jackson said the government would not “shy away” from the tough decisions needed to address housing affordability.

“We know the housing crisis is real and we don’t want any part of the housing market to be unexamined – everything’s under the microscope,” she said.

Up to 35,000 homes across NSW are used as “non-hosted” short-term rental accommodation throughout the year, according to the discussion paper.

The highest concentrations of short-stay rentals are in the Byron Shire and along the state’s south coast in areas like the Shoalhaven, Kiama and the Eurobodalla Shire Council.

Housing and Homelessness Minister Rose Jackson said “absolutely everyone” is feeling the effects of the housing crisis. (ABC North Coast: Bronwyn Herbert)

A further 45,000 properties across the state are used as holiday homes and another 15,000 dwellings are left vacant throughout the year.

Ms Jackson said it was clear these “under-utilised properties” were having an impact on the availability of long-term affordable housing.

“Absolutely everyone is feeling the pinch of the housing crisis,” she said.

“Renters have seen rents skyrocket in NSW, our vacancy rates are very low, they’re close to one per cent of vacant rental stock in some areas.”

“I don’t think that anyone would argue our housing market is functioning well right now.”

A booking tax on revenue from online short-stay rental sites like Airbnb and Stayz is among the measures under consideration in the discussion paper.

The Victorian government announced it would impose a similar 7.5 per cent booking levy from 2025, with income from the levy to be used to fund the construction of social and affordable housing.

Limits on the number of guests allowed in short-stay rentals, daily fees per guest, and lower annual caps on the maximum number of nights a short-stay rental can be listed were among other measures being considered.

The paper also proposed higher registration fees for short-term rentals, more onerous planning and approval requirements and limits to the number of homes in an area that can be used as short-term rental accommodation.

Ms Jackson said “all options were on the table” when it came to balancing the need for more affordable housing with local economies.

“We don’t want to do things that hurt local economies and hurt local tourism opportunities,” Ms Jackson said.

“But we also don’t want to do things that hurt housing affordability and mean that people can’t get places to rent.”

“We’re trying to explore those challenging choices and we want the community to be part of that.”

The discussion paper has been released for public consultation for four weeks.


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