So the government has just announced this cap in a bid to cool the rental market. Is this fair? Does it affect you?
I own an investment property in the CBD and 75% of the building rents their apartment out on airbnb including myself. We've never had any issues and everyone is super supportive of each other.
180-Night Cap on Airbnb
allocate 180 days for airbnb and the remaining days with their competitors.
https://www.huffingtonpost.com.au/entry/alternative-sites-to…
i think the idea is to limit properties to 180 days on short term letting sites altogether, and not just airbnb. Of course, I don't know how that'll be policed.
What we need is Airbnb to lobby the state to drop this futile attempt to restrict our liberties. They tried the same with uber, but failed miserably.
Airbnb will lobby. They are very good at lobbying.
Easy to get around. Rent out via Airbnb for 180 days. Lease to a friend/relative who then sublets to Airbnb the other 180 days. Done.
Because the government has protected tenants rights to sublet so strongly, owners can't restrict this and so can't be expected to control this either.
That's the plan with my properties lol
Maybe governments can start respecting private property.
maybe investors should stop making it so hard for people to buy properties to live in.
Wait wait - if I have money to buy a property, I should consider that other people who can't afford it as a factor in whether or not I should buy?
Please elaborate on that logic for me.
Surely smuggler means incentivising investors - and policy makers not addressing housing as a need rather than an investment vehicle.
But sure, as it's written, I agree you can't blame investors for behaving in their own interests.
How about an investigation on negative gearing and overseas investment
@ozbjunkie: There's no 'extra' incentive for investors right now. Rent is rent and not government controlled. The big boogieman of "negative gearing" is just being able to deduct expenses from income for tax purposes (which everyone, and every company, already does).
The government (profanity) up by trying to help first home buyers by throwing free money at them. What do you think happens when you throw extra piles of cash onto the "Demand" side of the "Supply-Demand" equation? Prices go up because a tonne of people now have an extra $10k - $15k in their budget - for the deposit, which translates to about about 10x that much to property prices.
What the government should have done is give the money to developers to try and sway the "Supply" side of the equation - maybe tying the money to sales to first home buyers.
Edit: Obvious reason why they didn't though. Give money directly to people, you get votes. Give money to developers which will make the whole market more affordable… and you don't get as many votes. Hell, you probably get criticism for giving money to developers.
@try2bhelpful: I've noticed that you have a tendency to say very generalized things that don't contain any specifics or details. Care to elaborate on what exactly you'd be investigating?
Right, first home buyers grant does nothing but raise prices. Agreed.
Treating homes as businesses is exactly what negative gearing does - and I claim this is failing to address the fact that housing is a need, whereas starting your own business is less so.
If the government could actually oversee a project without going over budget, I'd recommend something like council houses being made available for private purchase as were popular in the UK during 70s/80s (I'm guessing on the dates here). Some form of government home building would be great, as it doesn't seem the market generates enough new homes. But perhaps this is due to a slow release of new land, which is another story. I'd expect a need for more tradespeople - or more affordable ones - of this were to happen.
Not sure I have the answers, but having a situation where investors can sit on houses rather than start businesses and provide jobs seems a poor way to encourage productivity. Also, there's diminishing rates of home ownership among young people, and it's less a lifestyle choice than the fact that price to income ratios are more out of whack than ever.
Of course, people have their own views which are usually biased by their own financial positions. If you already own a house, or several, and have made and continue to make money, you don't want change. If you're in your 30s working an average job, without a property, you see things differently.
Bottom line is, you can't invest in air, or water - that would seem inhumane. But you can invest in housing and this results in many people having several houses when others have none.
Happy for you to point out where I'm wrong. Thanks for the reply.
@ozbjunkie: Nice comment, and pretty good points. The main issues are:
Treating homes as businesses is exactly what negative gearing does
Sure, but unless the government wants to stop taxing rental income the same way, allowing deductions is really the only logical option. Plus - other essentials like food, water, clothing etc are all able to be businesses too.
Not sure I have the answers, but having a situation where investors can sit on houses rather than start businesses and provide jobs seems a poor way to encourage productivity.
Not really. Anyone who buys property - both investors and owner occupiers - add to demand for property and push prices up. That's bad, sure, but that's also what encourages property development and construction* which adds to the overall total housing stock. Rental properties are still properties that someone can live in. You don't need to own a property to be able to live in it, and to me, having a roof over your head is the "essential" part, not owning that roof.
If you already own a house, or several, and have made and continue to make money, you don't want change. If you're in your 30s working an average job, without a property, you see things differently.
While this is true, there has to be an objective logical way to look at things without being biased. I try to aim for that (I have only the one property, I don't negative gear, etc) and I think others should too. It shouldn't always be "me me me".
Bottom line is, you can't invest in air, or water - that would seem inhumane. But you can invest in housing and this results in many people having several houses when others have none.
You can invest in food though. And clothing. There's nothing inhumane about not owning a property. Renting is not inhumane.
Edit:
*That is, other than incentives outside the normal supply-demand, such as direct incentives from the government to developers (like a FHOG).
Thanks. You've given me some things to think about.
I question whether the increase in house prices has really motivated much new construction. It seems if these were the only factors, and all else was constant, then a long period of increasing prices would eventually motivate enough construction to return prices to their long term multiple of median income. Not sure this will happen, but I'm hopeful.
As you seem to have thought this through, I'd ask what you think the increased price reflects? Immigration? Demand? Availability of credit (I think this one mainly)? The illogical Australian belief that house prices only ever go up (and this too)? Certainly hasn't been due to higher wages.
As someone who went into work after much of the boom period, I do feel a sense of bad luck, which borders on injustice (although I'm not really sure who to be mad at), that home ownership is simply less accessible than at any point in the last 50 years.
I question whether the increase in house prices has really motivated much new construction.
Oh it definitely has. There's a bit of a lag - it takes time for developers and investors (in construction, not individual properties) to see the increases, do their due diligence, scout locations, apply for DA, etc, but there's a reason why in the last 5-10 years, NSW has basically seen all new residential suburbs pop up almost overnight.
As you seem to have thought this through, I'd ask what you think the increased price reflects? Immigration? Demand? Availability of credit (I think this one mainly)? The illogical Australian belief that house prices only ever go up (and this too)? Certainly hasn't been due to higher wages.
A lot of reasons, you could call it a lucky (or unlucky) confluence of factors:
As someone who went into work after much of the boom period…
I don't think there's any reason to feel particularly good or bad about it. If you work hard and pay your dues, in Australia you'll always have a good life. If you're worried about missing out on a few years of 30-40% annual returns from property investment, that's just being greedy and you'll never enjoy life with that attitude of always wanting more.
And if you're worried about the lack of affordability of housing at the moment, that's probably you being a little spoilt, no offence intended. I saved up $10k in uni over just a year working part time so saving up is possible. You can probably save up more if you really tried and working full time - at least $15k a year which is $75k in 5 years. With 2 people, that's $150k which is enough for 20% down on $750k property. That's enough to get you a nice 2-bedder in a VERY good location, or a 3-bedder or even a house elsewhere, and if you're young and starting a family, what more do you really need?
I appreciate those points. But of course saving 15k a year when house prices increase far more than that each year seems like going forward so slowly it's almost going backwards.
Clearly once you're on the ladder you get to reap the benefits of those price increases - but only if you intend to sell your property and not buy another one, otherwise your property upgrade has become more expensive too.
I certainly don't believe quality of life in Australia is poor, and feel it's great that if you work here you can build a safe and decent life. Just owning a place is increasingly unreachable. At least for single income families and single people. With rates of first home buyers going down, I'm pretty sure that these latter points are not in question.
@ozbjunkie: Again, it's not as bad as I think you feel it is. You're saving up for the down payment. Granted, banks aren't giving out 90% LVR loans anymore so the down payment is almost always going to be 20%, but that still means saving up an extra $10,000 (for the 20%) means your property budget just increased by $50,000. E.g.:
Going from $100,000 as your 20% down payment (ppty price $500,000) to having $110,000 as you 20% down payment (ppty price $550,000) means you can afford $50,000 higher prices. Property prices are definitely not increasing that fast unless you're looking at multi-million dollar ones.
The gov is clearly too large when it has time and resources to waste on this issue.
How are they going to enforce this?
Bikies. They will throw anyone out after the 180 night cap is reached.
so I can book a room on the 179th night or not?
I can't see why there is a problem with how often people are renting properties. I think there should be stricter surveillance on people trying to use Airbnb as a tax evasion.
Income tax compliance doesn’t come under the authority of the nsw government. What they want is to the gst from Airbnb customers.
You mean not reporting rental income? That problem is not unique to Airbnb. People have been doing it with tenants too.
People renting overpriced short stays on airbnb=less places up for rent for actual residents=prices through the roof and availability is low
I just checked domain. 292 listings here.
https://www.domain.com.au/rent/?suburb=surry-hills-nsw-2010,…
Not sure if that is considered low availability?
Go rent some place cheaper? I know that public transport in Sydney is terrible, but many thousands of people apparently manage to live in the suburbs and get to work everyday.
Great idea.
We have an Airbnb across the road from us and we’ve had no issues, apart from directing people with suitcases to it because the numbering in our street is stuffed. However, if I lived in an apartment where there were a lot of air bnb guests having parties and crowding shared facilities I’d be a tad annoyed. Air bnb places rented out on a regular basis should be considered as short term serviced apartments. I have used air bnb properties and the experience was mostly positive but I do think that better surveillance of people entering and leaving properties would allay some of the neighbours fears. If the government wants to restrict rental via Airbnb then it should just create a tax level for these additional nights.
Occupants of units throwing parties and abusing shared facilities is an issue whether or not it's the owners, long-term tenants, or Airbnb tenants.
Yep, I've had lots of issues with tenants beating each other up, assaulting police, destroying common property etc. Never had any such issues with an Airbnb guest.
That's fine.
As long as halve all relevant real estate / wealth based taxes.
Great news. Maybe you can sell it to someone who wants to live there instead of foreign people
Its not fair. Owners should be free to rent on airbnb if they choose to do so. If owners are blocked or impeded from renting on airbnb, then ppl such as myself who rent temporary accommodation on airbnb will have to go to hotels or camping instead (where generally the rates are much higher, for a lesser standard of accommodation) .
If they are going to force such a sanction on private renters to people in search of temporary accommodation, then the same rules should apply to hotels, caravan parks, holiday units, holiday cabins etc.
Well by that logic anyone letting their place out for should lets should have to comply with all the rules that currently apply to hotels, caravan parks, holiday units, holiday cabins, etc.
So basically this entire document: https://www.legislation.gov.au/Details/C2015Q00331
Well by that logic anyone letting their place out for should lets should have to comply with all the rules
If its appropriate, and reasonably able to be implemented by people renting out their property on airbnb, well, why not ?
If it is not reasonably able to be adhered to by a person renting out a single property, on occasion, using airbnb… Well that is why not.
@ozzpete; I don't think you having to stay in a hotel compares to people not being able to find somewhere to rent. I can recommend some nice national parks for you to stay in though.
I don't think it is a matter of "comparing" . Is there not room for both, in a free market .
I would like everyone to have somewhere nice to live permanently (though I don't think Sydney is a very nice place to live tbh) . However I think also, airbnb is great because it cuts out the middle person.
Holiday rentals have been going on forever, just through real estates, or hotel companies etc, who take a large commission.
I am not saying to "compare" . It is not an either/or situation.
People should be allowed to rent their properties on airbnb direct to public.
People should also be allowed to rent their properties for permanent or long term tennants .
Perhaps some tax would be in order, to go towards public housing and/or housing for low income families.
I don't see why someone who owns a nice property in sydney worth millions, should be forced to only rent it on airbnb a maximum of 180days per year.
There is much more to be considered. Low income housing is one thing, but expensive properties in affluent suburbs is another.
The people really in need cannot afford to rent permanently or long term, in a really nice property in Sydney. Why force the owners not to rent that property on airbnb… and as I mentioned perhaps a tax or something which goes towards low income housinv subsidiaries for families in real need, would be appropriate.
Have 2 apartment Airbnb's in the Sydney CBD. Most guests are here on holiday or business. We've never had the issue of a party because we don't lease it out to people living in Sydney. I think the myth of Airbnb users trashing places and holding parties is stupid. It's not like we go on holidays and decide "Oh cool, I'm going to trash this place because I've booked it". Of course there are always instances of bad users, but that's life. It could be a short term tenant or long term. Imagine if you had a long term tenant next to you blasting the music and holding a party every week..
Yeah. If tenants "trashing properties" is really such a big issue, the government might want to abolish public housing…
It does affect me but I don't own an Airbnb - neighbours have an Airbnb and have had a number of loud parties, people filling up our bins, etc.
In a city with a housing affordability crisis I think it's more than fair. And the entire problem with Airbnb is that owners think it doesn't affect anyone but them.
Airbnb can be great but it shouldn't be untouchable.
Not much different to what tenants might do. Have you tried telling the host, or making a complaint with Airbnb?
Agreed, if the owners know about the problem they can put conditions on the Air BnB tenants to curb the behaviour. E.g charging for noise complaints.
Contact the owner and try to sort it out. They could be understanding and might try to solve the problem.
If they don't do anything about it, then that's just a d1ck move..
As usual a small number spoil it for the well-behaved majority.
Such is life.
I'm a very successful AirBnb host with a 95% occupancy rate within 10kms of Sydney's CBD. I host 2 apartments and make around 10k p/a per property MORE THAN I would via long term rentals. There will be loopholes and I will exploit them. lol
why ?