Airbnb x Strata restrictions

Discussion in 'Airbnb & Short Term Letting' started by Didiego, 12th Oct, 2021.

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  1. Didiego

    Didiego New Member

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    Hey guys,

    Is there any Owners Corporation/Strata regulations or restrictions in regards to renting my principal place of residence? Recently bought a unit but I'd like to check if I could have any problems if I decide to Airbnb/short term rent the place.

    Thanks for the help ,
     
  2. Todd

    Todd Well-Known Member

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    What city is it in? Every state has different regulations and sometimes cities within States are different.
     
  3. Didiego

    Didiego New Member

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    Hey @Todd ,

    Sorry, forgot to mention. It's in New South Wales
     
  4. Scott No Mates

    Scott No Mates Well-Known Member

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    I did notice an email recently from NSW Govt that there was a requirement for registration.

    Then there will be council requirements (you may need to check if the zoning or the Development Approvals allows short term letting and limits on the number of nights/month or year). Strata by-laws may have been passed to allow/preclude Air BNB.
     
  5. Todd

    Todd Well-Known Member

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    If you do a search "airbnb" on this site, there are quite a few threads on it and plenty regarding NSW and the rules and regulations. I rent out 1 of my apartments on airbnb in Canberra and a few things you need to consider before taking the plunge:
    - do research just by looking at what the competition is in your area. Get the airbnb app it is really good and easy to use. Look at the standard of the properties and what price they are asking. This will give you a good idea of what your place would rent for per night- take into account weekdays you will probably need to charge less (outside of holiday times). This is the best way to do it, forget any predictions on the airbnb website - doing your own research is far more accurate. I am happy my place is in a thriving busy city with lots of visitors all year, as opposed to a seasonal coastal town as income is far more consistent.
    - remember you will have to furnish and equip the place nicely in order to get decent reviews and fill up your calendar
    - if you self manage but don't clean the property, then cleaning is around $40/hr most places and if it's a 2bed/2bath property it usually costs around $100-120 to clean. That generally doesn't include the cleaning of linen
    - having started with an empty apartment, it costs around 10-12k to fully furnish and equip a 2 bed apartment (this does not include any painting or flooring you need to replace or repairs or any items). Will be less if you use your own furniture and bedding etc but be prepared for wear and tear if you do this. Ikea is a great place to buy everything you need in one place at a decent price and quality. You can get cheaper bedding (but good quality) from sleep maker commercial as opposed to retail outlets
    - with airbnb remember EVERYTHING has to be working including all appliances, everything in bathrooms, doors, windows etc - you can't leave something half working like maybe you would if you lived there. If an appliance breaks or there is a plumbing or electrical issue, these need to be fixed up promptly.
    - you will need fast internet and a quality TV, nice linen, good beds, comfy couches, a decent amount of everything in the kitchen re cutlery, bowls, pans etc, a working dryer and washing machine then you need to provide the basics to each guest including soaps, tea, coffee, tea towels, towels, sugar, salt etc.
    - if you pay a professional company to manage it, you are looking at 15-20% of gross income in fees (does not include the cleaning fees).
    - if you manage it yourself, you need to reply promptly to inquiries which come at all hours so if you have a really busy day job i would say forget self managing
    My other experiences are:
    - it takes time and attention to detail to run an airbnb well
    - if you don't clean and/or manage the property yourself, the fees and cleaning costs plus the uncertainty of income barely make it worth it, unless you have a high end property with high nightly rates (most people don't have this) that is running at over 80% occupancy rate (80% means only 6 nights or less per month empty).
    - you need to put in the time or your reviews and rating will drop off and occupancy will drop
    - it can be worth it financially if you are willing to set it up really well and stay on top of the day to day managing of it
     
    digizom, Piston_Broke and wylie like this.
  6. kacheek

    kacheek Well-Known Member

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    Check strata by laws. My building has one that prohibits short term letting and also they forbid installation of digital locks and lockboxes as any modifications to the door changes its fire rating.
     
  7. Momentum

    Momentum Well-Known Member

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    There will be CGT issues in the future if you rent your PPOR for income
     
  8. wylie

    wylie Moderator Staff Member

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    That's a really comprehensive answer, honest and realistic.

    I'm exhausted just reading about the ins and outs of AirBNB and know it isn't for me. :eek::p
     
  9. Piston_Broke

    Piston_Broke Well-Known Member

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    My understanding is that they cannot stop you from renting out your place of residenceif you go away, though it may have to be >90days.
     
  10. Paul@PAS

    Paul@PAS Tax, Accounting + SMSF + All things Property Tax Business Plus Member

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    In November 2021 the new laws will commence

    Laws for short-term rental accommodation
    - Short stay loction must be registered (and they can be made illegal)
    - Platforms can be penalised by state govt if they allow unregistered premises
    - Data from platform is shared with Govt
    - State laws change so that terms of under 3months are not governed by tenancy act. (Uninsured property !!)
    - Some enforcement will be delayed until May 2022